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14 Tips for Selling Software and Services Online

Software--whether sold as a service (SaaS) or via CD or DVD--is a multibillion-dollar business, with new vendors and solutions popping up all the time. In a recent Market Trends forecast, Gartner predicted SaaS and cloud-based business application services alone would reach $32.2 billion in sales by 2016.

But just because you have developed a great app or solution doesn't guarantee success. So how can you increase your chances of getting your software or digital offering purchased? CIO.com queried dozens of marketing and sales pros who know a thing or two about selling software and digital services online to find out. Following are their top 14 tips for how to sell software via the Web.

1. Use a reliable cloud hosting service instead of managing everything in-house. Why spend the time and money on building and maintaining your infrastructure when you can host in the cloud? "In just a few hours, a hosting provider can provision dedicated servers and cloud servers for you, and your business will be up and running with limited cost and risk," explains Emil Sayegh, the CEO and president of Codero Hosting, a provider of dedicated, managed and cloud hosting services.

[Related Slideshow: 10 Most Powerful SaaS Delivery Companies ]

Other benefits of hosting your software in the cloud: "You can do all your testing and development in their data center and then deploy into production," he says. "Once in production, if the load increases or decreases you can scale your infrastructure on demand without owning a single piece of equipment, or worrying about server maintenance and upkeep."

2. Beta test. "To sell software online it's important to get feedback before investing too many resources into the development of your site or product," says Phil Sharp, senior marketing manager, UserTesting.com. "Mock up the simplest version of what you're offering, get it in front of people and get their brutally honest feedback. This will help you improve your product early and save you thousands of dollars down the road."

3. Offer a free trial. Especially if you are "a small, unknown company, you need to provide something to help potential customers see that your product is not a scam, and it will work for them," says Kelly Wilkerson, cofounder, Decipher Media, which offers desktop solutions for managing iPhone data. "Slightly over half of the 'Buy' button presses on our Web page come through the 'Register' button within our trial software, rather than our regular product page on the site. Testimonials help. Software safety badges help. But nothing helps as much as a free trial."

4. Consider a freemium model. "Another option is to offer freemium versions of your software--free access to basic features with the option to access premium features for an upgrade cost," says Michelle Nerlinger, director of Marketing at SafeNet, a data protection provider. "It's a smart up-sell path that can encourage paid licenses." Adds Ryan Connors, the marketing manager at Apptegic, a customer engagement solution provider, "By breaking down the barriers to adoption, you'll find people more eager and willing to try out your software and service."

[Related: Analyst Report Advocates for Cloud, Saas Buyers' 'Bill of Rights']

5. Include a video of how your product works. "Have a one- to two-minute video explaining your product or service," someplace obvious on your Website, advises Alex Capehart, vice president of Strategic Accounts at hosting service Media Temple. "Animation is great for a simple product breakdown, and a video of employees can give a human side to a technical service folks might not understand. It works great for us and engagement is high!"

6. Show customers you understand their pain. "Whether it's telling stories to highlight how your software makes life easier, or alleviating fearful or cautious emotions that come with a potentially substantial investment by providing valuable information, creating human connections around your product is a powerful way to stand out against the competition," says Seth Lieberman, the CEO of SnapApp, a marketing platform for creating interactive content to drive leads and engagement.

7. Include product feature/benefit comparison tables. Including "product feature and benefit comparison tables, which that show your product in the best light, is essential," says David Howard, a principle at marketing firm Consultiq. "They summarize in an easy to read format the tradeoffs that a buyer has to consider in the purchase cycle. So long as you have a competitive offering, there's no reason to be afraid to do this."

8. Solicit independent third-party reviews. "Anyone can tell you their products are worth buying, so it is best to have an honest third party referral," says Jennifer Borun, senior marketing director, GoingOn Networks, a developer of social collaboration and communication solutions for higher education. "Encouraging your customers to tell their story of why they selected your product and how it meets their challenge is the best way to get your message out and sell your product. You can capture these stories in case studies, an interactive online forum or blog postings."

[Related: How IT Leaders Can Negotiate a SaaS Partner Contract]

In addition, "try to get a well-respected publication to test your solution/offering," suggests Allan Thorvaldsen, CEO, Panorama9, a cloud-based IT management platform. "This will validate your product (if it is any good) and generate traffic towards your Website for no cost."

9. Offer a money-back guarantee. "Studies have shown that a trusted and well-presented money back guarantee can actually increase sales by up to 40 percent," says Stephen Dodd, CEO of OfficeTime.net, a developer of time tracking software. As for how long the guarantee should be for, Dodd suggests 120 days, which is what OfficeTime.net offers customers.

"A short guarantee makes it more likely the customer will take you up on it," Dodd says. "They feel a time pressure to cash in the guarantee before it's too late. With a long guarantee, the customer feels they have more time to make up their mind." Moreover, he says, "the longer the customer spends using your app, the more time they have to get to know you and fall in love with what you've created--and the less likely they will request a refund."

10. Include a phone number, in addition to an email address, on your Website. "By adding our phone number to our Website, we increased sales and not calls," says John Hurley, the cofounder of the business class file sharing service SmartFile. "Sure an email is easier to administer, but showing people you have a phone number gives potential customers a sense of comfort knowing that you are a real business."

11. Offer 24/7 customer support. "We will never talk to 99 percent of our customers, but letting them know they can contact us any time of day or night goes a long away in developing trust with your potential customers," says Hurley. "If you're not large enough to provide 24/7 support, consider hiring an outside firm to do it."

12. Market across channels. "Effective multi-channel marketing programs can accelerate adoption of digital services," states Singu Srinivas, partner, Waterstone Management Group, a strategic advisory firm.

"For example," Srinivas says, "Netflix has used a mix of marketing strategies--advertising (online, affiliate, TV/radio/print), co-op programs with content developers, consumer electronics partnerships and freemium/trial promotions--to grow its customer base. And over the past decade, Netflix has grown from approximately 850,000 subscribers to over 29 million streaming members, while gradually reducing its customer acquisition cost."

13. Search forums to find prospective customers. "There are a lot of popular, industry-specific forums on the Web," explains Ted Galdi, the cofounder of StadiumRoar activity management software. "To find ones in your industry, do a simple Google search for '[your type of industry] forums.' Then sign up for any forums that seem legitimate and widely read." (Membership is usually free, he says.)

Why search forums for prospective customers? "Forums are great because people looking to buy products often go there to ask questions. You can use the search box to locate prospects that have asked questions about your type of product," he says. "Type in phrases about your kind of offering, and see in the results who has asked questions about it. Respond back to people with advice on how to solve their problems, along with a link for them to check out your product. This technique is effective because of the following:

You are locating people who are looking to buy a product like yours, as opposed to dealing with marketing guess work

You are building trust by responding back to them with honest, personalized feedback."

14. Use metrics--and adjust your marketing accordingly. "When you're selling online software you cannot set your [marketing] campaigns and forget them," says Caroline Cummings, vice president of Marketing, Palo Alto Software.

"It's important to always be testing--headlines, images, videos, links, length of page, calls to action, colors, etc. We have weekly analytics meetings where we're constantly looking at what is performing well and what is not," Cummings says.

By regularly checking metrics, you know what's working and what's not and can adjust your campaigns and minimize losses.

Jennifer Lonoff Schiff is a contributor to CIO.com and runs a marketing communications firm focused on helping organizations better interact with their customers, employees, and partners. Follow everything from CIO.com on Twitter @CIOonline, Facebook, Google + and LinkedIn.

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