Software Marketing Resource Articles: Ad-supported Software, the MediaCell Interview

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Monday, April 27, 2009

Ad-supported Software, the MediaCell Interview

We spoke to Josh Fox, marketing professional and founder of MediaCell about an alternative way to make your money from software sales: Ad-supported Software.

1. Tell us about MediaCell and what you do?
Media-Cell matches software publishers and developers with companies looking to distribute their marketing and research applications. This is accomplished via bundling, where the bundled applications are offered during the download/install process. Many factors are taken into account when matching up entities, including but not limited to type of applications offered, geographic distribution and volume of the publisher's download activity. We also act as coaches and consultants, as we have a vested interest in our partners' ongoing success.

2. How does ad-supported software work as a business model?
What's nice is that ad-supported software does not necessarily cannibalize shareware sales. What it does do is virtually guarantee that each download will be worth something. End users who are averse to the idea of ad-supported software may in fact be driven to purchase shareware versions of the software. The publisher can therefore, "Have their cake and eat it too." Another point to note is that software advertised as "FREE" tend to be downloaded several times more often than trial versions, so this should be taken into account as well.

3. What's the bottom line, are people making money with ad-supported software?

4. Lots of companies are experimenting with bundling software, as an Independent Software Vendor how would I go about doing this?
Provide as much accurate information about download activity as possible before getting started (volume and top 5 countries especially), as well as marketing methods currently employed or planned. A company such as Media-Cell will be able to determine the best fit for the publishers with this data, as well as give free advice for marketing and distribution based on a wealth of experience. We can also provide boilerplate scripts so the bundles can be built and approved quickly.

5. There are several companies who offer toolbars that you can bundle with your software, can you tell us about them and how that works?
I'd prefer not to mention any companies by name, but I can certainly share my general observations. Those who are willing to pay a bounty as opposed to a rev-share tend to be the more robust partners, who are confident in their business model. Rev-share = zero risk, and typically the rewards are far less predictable. Another important thing to take into consideration is that, to my knowledge, any and all of these companies are only going to pay for new installs. So if, for example, XYZ toolbar is already present on the end-user's machine, the publisher will not get credit for a new install. One can read into that what they wish, but those considering working with the widely known and distributed toolbars, etc. might wish to consider bundling applications that aren't as popular (so long as they pay well, of course).

6. How do you see the online software sales landscape changing, especially given the economic crisis?
There has been a steady migration toward the ad-supported freeware model. Many folks just aren't willing or able to pay for software any more unless they absolutely must have it, and publishers who used to be dead-set against this model are coming around to the idea.

7. How does software bundling play into international sales, does it work well in emerging markets?
Publishers in emerging markets have shown by far the most enthusiasm for this model, particularly those with applications that are popular in the countries that pay well, typically US, Canada & EU.

8. Ad-supported software clearly works well for online software as a service, do you see it working inherently better for that model?
I would say yes, but some hardware companies have been getting into a similar model for quite some time now. An example would be new, brand-name PCs being distributed with trial or lite versions of software titles.

9. Some people may view using ads as a turn-off to customers, what rules can you tell us for getting it right?
Be up front with your customers and offer the free, bundled versions alongside the shareware. Also, though many bundled applications are allowed to be required installs, the best advice is to make them optional during the install, keeping in mind that most people will accept and click NEXT anyhow. Choose bundled applications that are easily removed via the add/remove programs menu, and those that follow TRUSTe guidelines are a safe bet. There will always be a certain amount of false-flaggings by some AV software, so it's important to make sure that they are actually false and you aren't distributing nasty applications.

10. Do you see ad-supported sales superseding regular software sales any time soon?
From what many publishers have told me personally, this has already happened. However, this may depend greatly on the type of software being offered.

Josh Fox works for He adds: Please feel free to contact us directly via our website, if you'd like to partner with us.


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