Software Marketing Resource Articles: UpClick Brings 0% Fees to Software Sales

You wrote the code, now how do you sell it?

Thursday, July 9, 2009

UpClick Brings 0% Fees to Software Sales

There's been a lot of talk about the latest e-commerce platform to emerge on the scene. We took the time to talk to Michael Dadoun, UpClick's COO. Here's what he had to say.

1. UpClick is the new kid on the block' in a world of many e-commerce services. Why does the web need another payment processor?

You are right. There are a bunch of payment processors in the market already, but we see ourselves as much more than a basic payment processing platform. UpClick offers software vendors a one-stop solution for selling online with an economic model that makes it a no brainer for them. Before UpClick, there were basically two types of payment processors that software vendors could choose from: on one side, they could choose companies that offer a commoditized product where differentiation is low and the only factor is pricing. On the other side, they could choose a value-added ecommerce platform that (on average) cost between 7 and 15% to use. We have a different approach. Our emphasis is to create value for our customers by offering the best technologies and practices, maximizing their Average Revenue per Order with optimized cross-selling and by offering a dynamic affiliate marketplace.

2. On your homepage there's a big "0% fees" advertisement. If you don't charge any fees then how do you make any money - what's the catch?

No catch. We indeed absorb the payment processing costs and the costs of first level customer service. We make our money in 3 ways:

- We enable merchants to cross-sell products from other UpClick Merchants on their check-out pages. When this happens, we take a small commission and the two merchants split the remaining revenue.

- We offer consumers complementary products -- such as CD backup of the software they bought -- at the time of check out and/or after the transaction is approved, and split the proceeds with the merchants.

- We charge a small $1 fee for transactions generated by our affiliate marketplace (compared to up to 30% of the commissions charged by other affiliate networks).

3. We've seen UpClick mentioned in the media a lot recently, are vendors signing up?

Yes! The reaction has been tremendous and our value proposition gets our potential customers’ attention every time. Of course, we understand that changing to a new platform provider is something customers do prudently and often only after testing. However, we’re seeing a lot of traction and are actually exceeding our forecast

4. So give us the rundown, what features does UpClick's system have?

We have a long list of features and the best way to see all of them would be to visit our website. Even with all our features, one thing we’re especially proud of is our extremely simple interface. A software vendor can sign-up, upload his product and license keys, and get our innovative buy buttons to put on his site in about 5 minutes!

5. Besides the big "0%" is there anything that differentiates you from the most established e-commerce solutions such as Digital River and Plimus?

Pricing of our services is of course the obvious one, which helps our Merchants save money. But, we also enable merchants to make more money as well, through our cross-selling capabilities and our affiliate network. Merchant A can dramatically increase his average revenue per order by offering to his customers a product from Merchant B at the time of check-out, creating new revenue for both of them. Another differentiator is our geo-targeting tools that allow merchants to customize pricing per currency (ie. $19.99 in the US or 19.99 Euros in Europe, instead of the typical straight conversion that would give 14.39 euros). There are many more features that differentiate us, and as I said earlier, despite the feature-rich platform, we’ve very easy to use.

6. Is UpClick just for software sales or does your system allow selling of other products?

Our expertise is in software sales, so for now, that’s where we are focused However, we also support some related products such as ebooks, and have plans to eventually expand into membership sites (content, newsletters and even Software as a Service) and maybe some other product categories.

7. E-commerce continues to grow, even in this sluggish economy. How do you see the next twelve months playing out for software developers?

The software industry is a great place to be. It is still a growing industry. The international markets have been an area of strong growth for North American software companies and will continue to be. Consumers are buying their software online now more than ever and that trend will continue in the next 12 months.

That being said, the online selling of software is extremely competitive, but we believe that we offer the tools to allow companies of any size to compete internationally.

8. With new business models such as SaaS (software as a service) and web applications, do you see desktop software, and desktop software sales, as having a limited lifespan?

Very interesting question. Obviously SaaS is a growing segment and one that is getting a lot of attention particularly in certain markets such as Asia. We don’t see this as a threat since we will be supporting both business models in the future. Having said that, we don’t see the downloadable software market as disappearing any time soon. We believe there will always have a need for software to run, protect and maintain your machine.

9. As you work with a lot of developers, you must see people making the same mistakes over and over again. If you had one piece of advice for developers what would it be?

Keep it simple. Most of us working in technology have a tendency to try and build too much functionality into our products to a point where they become too complex for most people.

10. Will we see you at the Software Industry Conference in Boston this July (we'll be there too)?

UpClick is a proud sponsor of the SIC. We will have a booth and I should be giving a presentation on Localization and Cross-Selling. We’ll see you there!

About the Author
Michael Dadoun is the COO and co-founder of UpClick


Anonymous said...
Given their 0% pricing and that they appear to have to cover salaries for about 20 employees based on their website, I'm concerned about their ability to sustain themselves for much time. MicroISVs should be evaluating lots of different factors, only one of which is price, or we may get what we pay for if you know what I mean, heh. And their asking us software people to give up some of the most lucrative profits from their order pages by sharing the CD revenue, cross-sell revenue, and all that. It's foolish to give up that control and that all too valuable revenue source. We'd end up effectively paying a lot more for ecomerce than we would have by using a normal shareware ecommerce solution I think at least.
Anonymous said...
Seems a little misleading that they list big name clients on their website but when I visit those software sites none seems to be using them for their online store. They must be using upclick for the cross-selling of their apps for free but just not for ecommerce. Also they keep saying there's no catch but there is a catch - they take some of your revenue on the order page to pay for their fees.
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