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WWDC06 • Session 004

Go-to-Market Strategies and Services for Mac Developers

General • 39:27

Get expert advice on how to bring your product to market effectively. Learn how to use Apple Developer Connection (ADC) programs and make the most of other opportunities to help increase your success in the marketplace. We'll cover the full range of go-to-market topics, including promotion options, distribution channels, co-marketing with Apple, and more. We'll also provide constructive guidance based on our experiences with helping thousands of Mac developers around the world successfully market their products.

Speakers: Paul Papageorge, Wayne Pfeffer, Erik Lammerding

Unlisted on Apple Developer site

Transcript

This transcript was generated using Whisper, it has known transcription errors. We are working on an improved version.

Welcome to Apple's go-to-market session, the last session of the day. And we're really excited to be here today. My name is Paul Papageorge, Senior Director of Marketing, of Developer Marketing, and we've got a really good session for you today. This, out of the 147 sessions this week, is the only non-technical session.

So if you're on the wrong flight, it's time to get off this plane right now. So we've got some great stuff for you. Joining me on stage for part of the presentation today is Wayne Pfeffer from Apple's Retail Store. He's got some great stuff about retail strategies and about some specific things about the Apple Retail Store. Also joining us is Erik Lammerding from Developer Relations Partnership Management. He's got an awesome success story about what's happened with a developer since last year's WWDC.

So in thinking about a go-to-market session, we could talk about theory. We could talk about marketing. But what I really want to do today is make it as practical for you as possible and think about your marketing plan. How can you make your own marketing plan or add this to your marketing plan? So we really want to go with some content and with some marketing ideas that will be practical and usable for each of you, things like building awareness of your product, exposure of your product, how to co-market with Apple, Do you have a plan for Macworld? We've got a great program to talk about today. Things like advertising, sales promotion, and as I mentioned, some great things about retail distribution.

So let's get into it. I want to talk about a few things. Let's talk about exposure. How do you get exposure? What are some no-brainer things for you to do? And we're going to talk about a few of those things right now. So exposure starts at Apple.com. There's a bunch of ways and a bunch of places on Apple.com for you, for developers, and we're going to go through each of those.

So, the Apple.com homepage. We get tons of traffic. Right on the homepage is the Made for Mac button. That's the Mac Products Guide. DotMac has an entire developer program for developers who have DotMac integration. Widgets. If you have a widget, we've got a place for you on apple.com.

And of course, we have the Mac OS X Downloads site. We're going to go through each of these. There's a lot of new information we want to make sure you know about. Let's start with Mac OS X Downloads. So, as you know, Mac OS X Downloads, destination for all things Mac OS X, it gets a staggering 600,000 page views per day.

Even more impressive, 120,000 downloads a day. So if you're not there, we're going to talk about how to get your app on Mac OS X downloads. Widgets, if you've got a widget, again, the place to be is the Dashboard Widgets site. It's the most comprehensive listing of widgets. Over 400,000 page views a day with an equally impressive 80,000 downloads a day.

And as I mentioned, if your product has .Mac integration, the .Mac site, now with over one million members, has an entire developer program that has some really robust co-marketing programs for .Mac programs. And you can be showcased as a Mac developer. They have a sub-site within .Mac where it's called .Mac Spoken Here, and some great apps are featured. There's co-promotion, really good marketing programs.

Now, we mentioned the Mac Products Guide. Most of you know the Mac Products Guide. It's the most complete listing of Mac products in the world, 23,000 products and counting.

[Transcript missing]

You click on that home page, you go to the entire section of the Universal Apps, and these apps are all categorized by application type.

If you were to click on one of these apps, the other thing that's new about this, let's say Doom 3 in the Games section, it brings up the information about Doom 3. As you may be able to see here, there's a Buy Now button. So if you're in the Apple Online Store, it will take you right to the Online Store where there's customer reviews, and you can add it to your shopping cart.

The other thing that's new about the MPG is there's an entire new arrivals section on the home page. So if you submit your product to the MPG or you update your product on the MPG, you'll be featured on the home page for two weeks. Now an example of this, as you can see, we scroll down the home page of the MPG and the one on the bottom right About a month ago was Serene Saver. Now, they were on the homepage for two weeks, and after being featured on the homepage, they realized downloads and sales increased by 4x. And we're talking about simple exposure for you, and it's been working for the programs on the MPG.

The other thing that you may not know about the MPG, and here I brought up a page of Apple's small business site, Apple's got a lot of vertical marketing sites, a lot of marketing sites that feature third-party products. And so you can see this one as an example of small business. Small business is broken into verticals that include architecture, health, legal. And let's just take architecture as an example.

You go to the architecture page, and on the bottom right or on the sidebar there, if we were to click on design and drafting, if you were to click there, It actually goes right into the MPG. So this is a great way to get your app, again, not only on the standalone side of MPG, but within Apple's marketing sites that does a lot of the marketing around complete solutions.

So those are some simple things for you to take advantage of now. And the good news is all those things are free, and they're designed for you to be as part of your marketing plan. Now there's a few marketing programs I wanted to talk about before we get Wayne up here to talk about retail. One is called Hot Deals.

How many are familiar with Hot Deals? Okay, a smattering of you. We have just overhauled the Hot Deals program to be able to include every developer and every product represented in this room. So what is Hot Deals? Hot Deals is a site at Apple that features promotions of your products, whether they're from the Apple online store, from other online retailers. Now we've added the ability for developers who may not even be going through retail or selling online, just selling off of their site, you can get promoted on the Hot Deals page and on the Hot Deals site.

So how does it work? What do you have to do? Well, you just have to provide your promotion, your limited time offer. Apple will do the rest. We'll feature you and market you on the Hot Deals site. We will promote it on many Mac enthusiast sites. And that, in turn, drives traffic back to your product, back to your site.

The second program that I want to talk about is being rolled out. In fact, you're the first ones to hear about it. And it's regarding Macworld 2007. So we've been working very closely with the Macworld folks, and we've put together a marketing package that we think you're going to be excited about.

It's an ADC exclusive. In about an hour, it'll go live on the website for the entire ADC base to see, but you're going to be the first ones to look at it today. And it's a complete package around Macworld 2007. It provides exhibit booth space at Macworld in San Francisco, advertising in Macworld Magazine, and online promotion on the various Macworld sites.

So the booth, picture your product here. In fact, here's an ADA winner. We're already working on the signage because one of the prizes is exhibiting at Macworld. It has the logo of your company, product information, internet connection, power, complete turnkey just to show up with your product. And the exciting thing is that it's going to be part of the ADC Developer Pavilion.

We've reserved space at Macworld to have your booth, your exhibit area, all in one area, and we will be showcased together as a group as the ADC Developer Pavilion. And in addition to that, it'll be located near the Apple booth, so the traffic will be awesome. Now, we didn't want to make this... But wait, there's more.

We didn't want to make it a one-week event. I mean, this is great, but a marketing plan needs to be more than the one week. And so we've added advertising. And again, we're closely with the folks at Macworld. And this marketing package includes three months of advertising in Macworld Magazine-- December, January, and February.

So both before to drive traffic and then after, to follow up after the show. And here, we have eighth-page ads running for three months. and your ad would go there. And we'll have a special section featuring all those in the pavilion and in this showcase in the print advertising.

In addition, your product, this, in fact, will take this very idea of a showcase from print advertising to online, and Macworld has various sites. You would be not only featured there, but as you may be able to see here, there's a demo button and a buy now button, and that will be included for your product. So we'll demo it right off of the Macworld sites and drive traffic back to your site. And again, this is three months of online promotion.

So together, we've got exhibiting at Macworld 2007, print advertising before and after, and an online promotion for three months, an entire package that could be a really powerful part of your marketing plan. So how much would you pay for all this? Well, if you priced all this out, it's about $37,000. And we're happy to work really closely with Macworld to be able to make this entire package, three-month package, for you guys exclusively for under $5,000.

Now, we're going to talk in a little bit about how to take advantage of this because tonight could be the night. You're going to see it for the first time. It's going to go live for the greater ADC base, and we want to give you guys the first shot at it because spaces are limited. But if all of you want it, we're going to make it available for all of you. So stay tuned for later in the presentation, and we'll talk about how we're going to gather afterwards.

Now, everything I just talked about is going up on a website, a brand new part of the ADC site. Now, obviously, ADC, we all know and love for its technical content. And today, we're rolling out an entire new section around business and marketing. And everything you saw, you've heard so far today, and you will hear later, will be up on the site. As you can see here, Hot Deals, the Macworld package.

The Mac Products Guide widget.mac Mac OS X downloads. Everything has a Submit Now button or Apply Now button. Very actionable. And so whether you're taking notes or not, you'll be able to get all this content afterwards and be able to take advantage of all of this. So with that, I'd like to ask Wayne Pfeffer from the Apple Retail Store to come up here and share some cool things with you. Wayne.

Thank you. All right. So what I want to talk to you guys about today is retail, and how do you get your product from where it is now to a retail channel? And retail includes not only the Apple Retail Store, but everybody else out there, CompUSA, Best Buy, and the online guys, too, like the Amazons and CDWs.

So I've broken this into two sections today. The first will be a high-level overview about how to get into retail in general, and the second piece will be specific to Apple Retail. If you were to bring your product to Apple Retail, what are the buyers there looking for, and how are they building their assortments? So let's go ahead and dive right in. So we've got the developer, you've got your product, and what's next? How do I get, ultimately, my product on shelf? So there are three people out there, in addition to Apple Developer Relations, that can help you. These are publishers, distributors, and vendor reps.

Now, each of these three has a different level of service that they'll provide for you, and then, obviously, associated with that, the more service you're going to require, the higher the cost. So as we go through this presentation, keep in mind that whichever one you choose, or whichever combination you choose, the more people that you add in that distribution chain, the higher the cost is going to be. So at the end of the day, you're going to want to make sure to weigh the cost and the benefit, and make sure that this makes sense for you.

So how do you know what each of these does for you, how much they cost, and who to go to first? And that really is going to depend on where you are in your product development lifecycle. And so there are three kind of key things. It'll help you determine which of these people you go to, a publisher, a distributor, or a vendor rep.

And we'll start with pricing. Pricing sounds easy enough, right? I'm going to sell it at $59.99, and I'm going to go to market. But if you price too high, what happens? Product will sit on shelves, and you're going to end up possibly with product coming back, and then it doesn't work for you, the developer, or for the retailer, or the distributor, or channel partner that you've used. So at the opposite end of the spectrum, if you price too low, think about the customer connotation out there. If you have a product that's selling for $4.99 on a shelf, as a customer, you're going to think that it's cheap.

And I'm talking cheap not in terms of price, but the value. So price, when we think about setting a price on a product, is really the customer's perceived value. So it's pretty scientific, and it's very critical to going to market. So pricing is one of the key elements that you're going to want to consider and think about where you are before you go into the market. And I think that's going to be a key element in your approach to pricing. So I think that's going to be a key element in your approach to pricing. or a vendor rep.

The second one is packaging. So many of us here, we've written a product, we've got code we might be selling via download right now, or taking advantage of some of the opportunities that Paul covered, but we don't have a physical package yet. Packaging is extremely important, because when you're in a retail setting, think about it as a customer.

You're looking at a whole wall of software, and what's going to grab your attention? You as the developer are not there to explain, to explain to a customer why this product should be purchased over a similar product in the market. So you want to make sure that you've got an attractive box, and that you leverage the real estate on the back of the package to call out the features and benefits. And I'm going to get more into packaging later. And then the third piece is marketing strategy.

Paul covered it a little bit, but it's very, very important. The process of bringing a product to market doesn't stop with pricing it, putting it in a box, and getting it on a shelf. So what happens once that product gets to a shelf? Resellers out there in the market are going to expect there will be some kind of marketing effort behind it on your part.

And that could be as high end as a huge Target circular on a weekend, all the way down to simple things that are very cost effective, like being loaded on a demo machine in a retail location, or getting a shelf talker placed under it to call out some features, things like that. And this is just three of the things that are pretty high level, that you need to think about before you decide which partner is right for you, a distributor, a publisher, or a vendor rep.

So given that, let's go ahead and look at three different scenarios, and which partner can help you. So let's assume that you've got all three of these. You've got pricing, you've got awesome packaging, you've got a marketing budget set aside, and you already know the activities that you're going to be able to do in the market.

In this case, you can go straight to a distributor, and then the distributor will help you to aggregate product and send to each reseller. The good thing about a distributor here is that if you as a developer were able to get your product into one of these retailers, for you to sign an individual contract with each and every reseller would take a long time.

A distributor, you can sign one contract with them, work out the details, and leverage their existing relationships with the resellers. They will manage the inventory for you, help you with the collections, returns, everything. So a distributor is a really good person to go to if you've already got your market plan set, your pricing, and a package version. Notice there's one step between you, the developer, and the resellers. This is going to be your lowest cost to market, because only one other person is handling your product. But let's say we don't have all three of these yet.

Then what do we do? One other partner that we could go to is a publisher, and the publisher in turn can leverage their relationship with these distributors. So say we don't have packaging yet. We've got a price point for our product because we know about some similar products in the market, and we know the features and benefits of our product, and we've lined them up, and we think we can charge a $10 premium, or we want to go out at the same price and try to take market share, but we don't have packaging yet.

You can work with a publisher who in turn will help you get packaging either in-house or with a third-party vendor that they've got relationships with. The publisher will then leverage their relationships with buyers at each of these resellers to help you place your product and then help you to ship product in through distribution and ultimately end up on shelves at major retailers. But again, we've added one more level here. So when you need to go to a publisher to help get packaging or pricing, or even advice on promotional strategies, it's going to add another layer of cost.

So keep that in mind as we go through this. And then in the third scenario... Let's say we're very new to market. We don't have a lot of this down yet. We might need help with everything. We don't know which price point we want to go out at. A marketing strategy might be something that's completely new to us.

A vendor rep is really somebody that's going to partner with you and help you take your product to market. So these vendor reps usually already have relationships with publishers, distributors, and buyers at all of the major retailers. They will be able to partner with you, give you trends, specifics on each retailer, which ones you might want to target. They'll already know the certain programs that each reseller has available for you to promote your product.

At one retailer, you might be able to do an end cap with your product. Another retailer may not let you do that, where you think, I'm going to do end caps everywhere, and that's how I'm going to sell product. They'll help you to understand the different nuances that every retailer has out there. They'll help you connect with packaging, and they will help you to develop a, a promotional strategy.

So in general, a vendor rep will add the highest level of service, work with the publisher, potentially to get packaging, and ultimately you'll still end up going through a distributor to get into a reseller. So I leave a distributor up here on every page, or every slide, because in general, you're going to be using a distributor to get in to one of the major retailers. On some occasions, there is the distinct possibility that you could go direct, realistically in 90% of the cases, you're going to end up using an aggregator, a distributor, leverage their existing relationships, and get product in that way.

So here, we've got the highest level of service. You've really got a business partner and your vendor rep that's going to walk you through all the steps of the way, lead you in the right direction. They're going to possibly use the publisher to help you develop your packaging, and then you're going to end up with product at a distributor to ultimately get it on shelves.

So, what about Apple retail? I'm one of the software buyers for Apple retail and manage the software assortment. So if I were to meet with any one of you and look over the product, what are we specifically looking for to add products into the assortments? and we kind of have a distinct assortment, or we think that we do, because we see our stores as a bit different than a typical retailer out there.

The high level of service, the creative bars, the studio bars, the theater demos, we think that there's a lot of value add to not only just putting the product on the shelf, and everything that goes on behind that is making sure we have the right assortment for our customer base.

So I'm sure that a lot of people here have been into an Apple retail store, and if not, I have a two minute video clip that's kind of going to go through what Apple retail is all about, and for those of you that have been in, I'm sure you'll probably recognize some of the stores. So let's go ahead and roll that.

We're opening a new store almost every other week or even once a week. We're in four different countries, soon to expand. Sales are increasing like crazy. In the mall locations, our sales per square foot are higher than anybody around us. So, what are we looking for in order to come into the retail assortment? And I gotta say, on a daily basis, we're constantly looking for new, great applications out there, and would love to look at everything that's out there, add to our assortment. We're constantly changing, and when applicable, if we've got a lot of great new apps, we can always figure out a way to get more space allocated and add some things in. So, I think this bodes well for everybody here.

So, if we were to have a meeting and talk about getting a product into Apple retail, what kinds of things would the Apple retail buyer be looking for? So, let's start with product. So, I have this up here, consumer-focused. If you look at the retail stores and the traffic that's coming through, we saw last quarter over 17 million visitors in one quarter. The holiday quarter, we were seeing 2 million. We're seeing 2 million people per week. Incredible amount of traffic coming through. Lots of demographics, but the vast majority of the people that we're seeing are consumers.

And I say consumer as opposed to the business customer, but keep in mind, for those of you that have a productivity application or a high-end graphics app, we still do a high amount of sales to business customers. We've got special small to medium business teams out there that are doing inbound and outbound.

So, there's still definitely a place for the product in the store. But as we were to look at what's on the floor in the assortment, consumer-focused is what we go after first, and an extension of the Mac platform. So, when we're evaluating a title, we really need to make sure that this is the right solution for Apple and that it's enhancing the user's experience of their Mac hardware.

So next, packaging. Again, consumer focus, knowing who that target customer is. If you've got a consumer app, you want to make sure that you're speaking to the customer in terms that they'll understand, letting them know how this product will benefit them. Obviously using the appropriate logos, calling out customers are now looking for that universal logo, so it acts also as a marketing piece for you.

And product differentiation on the packaging. And I think packaging is very important because, like I said, when you're walking through a retailer and you're looking at a wall of software, you've really got three to five seconds to catch that customer's attention so that they pick up your box.

So I want to dig a little bit deeper into this and talk about what I mean on packaging. So here, on the left-hand side, we've got the front of the box, probably a high-resolution graphic that kind of talks to what your product is, obviously the product name, the appropriate logos. And on the front, you really want to make sure that you're talking to the right people.

And on the right-hand side, you really want to keep it kind of clean and not put too much text, like paragraph form you probably want to avoid, maybe a couple of bullet points on what the product does, who the customer might be and how they'll use it, or even like a tagline.

But again, the front of the box, since you're not in the store making an assisted sale, this is what's going to get the customer walking down the aisle to grab that box and want to know more. The back of the box is really where you want to leverage your real estate and talk more about what the product does, how it's different than products that are out there in the market. The back of the box is really where you want to leverage your real estate and talk more about what the product does, how it's different than products that are out there in the market.

So that's packaging. And third, price. So again, target customer. If you've got a consumer application, maybe an education title for first to second graders, probably not going to go out at $100 price point. If you have a high-end productivity app that's for a business user or a pro photographer, you want to look at who that target customer is, where it fits in with other products that are out there and priced appropriately. So I think pricing often gets overlooked.

It sounds simple to just say I'm going to sell at $199 or $299. But there's a lot of science behind it, and you really got to think about how that's going to affect the success of your product. Again, differentiation. Knowing how your product is similar or different to other products.

If there's a similar product in the market and you've added new and improved features, are you going to price at the same price point as that product and try to take share? Or do you think that your features warrant a $10, $20, $30 price premium and go out that way? So it just depends. It depends on how you think your product is positioned. And the third thing here is margin. So at the end of the day, this needs to make sense for everybody, right? For the retailer, for the distributor, the vendor, the vendor rep, the publisher, and you, the developer.

So think about when you're setting price. Once you've added up all the costs that it takes you to get to market, and then what is the retailer going to require to justify the shelf space in their stores? At the end of the day, how much is left over for you, the publisher, or you, the developer? So if you sold a $100 title and the retailer is requiring 30 points of margin or 30%, then $70 is left to flow back through that chain. And after your distributor touches it and you pay for the packaging and everything else that's helped you get to market, you need to make sure that the cost benefit is there and that this makes sense for you.

So, summary for Apple retail, what are we looking for? Product that's an extension of the Mac platform, universal apps, attractive price points, and awesome packaging. What does this all mean? Once you've met with an Apple buyer, you've got all this in line, and they say, yeah, we want to bring it in.

Does this mean that of the 155 stores that we have open worldwide right now, does it go into every single store? And the answer is maybe. And the answer is it depends. And it depends on the application. It depends on the price point. It depends on what other titles are out in the market right now. But one of the good things that we have is we're pretty flexible.

We've got several different footprints. We're in almost every major market. We're in every major market in the U.S. So we can kind of pick and choose where it makes most sense for that product. Now, probably as the developer, you're going to say, well, I want to be in every single store. That gets me the most exposure. But think about it.

At the end of the day, if the product goes into a store and just sits on the shelf, after some amount of time, the math isn't going to work, and that product's going to end up coming back to the distributor and then back to you. So we really want to work together on this and make sure we put it into the right stores. And that's what some of our footprints allow us to do. Now, say we went into half of the stores.

What happens in the other half of the stores is if somebody walks in and says, I want to buy such and such title. I heard about it. It's awesome. I want to buy it. Well, down here I have online. Every terminal and every single retail store serves as a kiosk.

So if a customer walks in and says, I want the upgrade to this, and we don't carry it on the floor, we can walk them over to kiosk. They can type in all their customer information, credit card info. It'll ship to their house. If it's a title that's over $50, it'll ship free. So three days later, they end up, they've got the package at their door.

So even if you are only in a subset of the retail stores, you're virtually in every store. And then it becomes a question of promotional. How do we let those store associates know that that product is there? And that goes back to your marketing plan. And that's it for retail. I want to go ahead and introduce Eric Lambert. now and talk about a real life success story.

Thanks, Wayne. We heard all this great stuff that Paul talked about for marketing. Wayne talked about retail. What we thought would be fun is to capture a story about a developer that leveraged all of this and realized some really great success. That developer is this company called Plask that makes a product called Comic Life. I'm curious, how many people have heard, or seen, or used this product? OK, it looks like just about every hand went up in the room. Let me tell you how they got to the point of having every hand go up in the room.

And what better way to tell a story about a comic book application than doing a comic? So this all started with a colleague of mine calling me and saying, "Erik, you've got to check out this application. It's great. My kids love it. Your kids would love it. You can make comic books." So I downloaded it, took a look at it.

It's a beautiful Cocoa UI. One of the things that we really look for is how are you leveraging the platform? You've heard a lot about that at the conference. What are you doing with our tools? How are you paying attention to the user experience, et cetera? And this was one of those apps that really grabs you. It's intuitive. It's beautiful. It's fun. It's whimsical. They did a great job.

So I thought, I'm going to get on the phone, and I'm going to call these guys. I've never heard of them. Who are they? They're doing great stuff. And I ended up talking to the gentleman who's up on the upper left-hand side, Robert Grant, and he gives me a little description about this company. Three guys, one in South Carolina, one in Switzerland, one in Melbourne, Australia, and they collaborate online and build this great application.

Well, they've grown a little bit more than the three now, so they're doing well. And they start telling me the story. Well, first of all, they're, of course, using Apple's tools. Xcode. You've heard about Xcode and Xcode 3.0 here at the event. I talked to Robert. I said, well, you're coming to the developers conference, aren't you? Well, I'm not sure. And I talk him into coming and hook him up with some of our engineers.

At this point, we're on the cusp of pushing Tiger out the door. We've got these great technologies like Quartz Extreme and Core Image, etc. And over a weekend, he turns all this stuff on. So great filters in the application, so forth. Great developer story. He also tells me, you know, those eyesight cameras, you can plug them in, take your picture, plug it into the comic strip that you're building.

Well, they come to the developers conference, and lo and behold, they win an award at the Apple Design Awards. They get connected with the .Mac team to a great promotion. Not only do they do a promotion, but their application is actually integrated with .Mac. You make this beautiful comic, hit a button, it's published to the .Mac -- to your .Mac web page.

And that's something I really encourage you to think about. There's so many creative things you can do and easily -- by easily integrating with the .Mac service. After that, they get connected with a company called Freeverse. Freeverse, similar to what Wayne was talking about with finding a publisher, helped get their product published, boxed, and put on the shelf at our retail store.

And after that, I hear from the people who do our software bundling, they say, "This is a great app. We want it on the machines." So now, every Mac that goes out the door is bundled with Comic Life. It's a great story about how a small developer really took advantage of all the things that we offer, put it together, and realized great success. So, Paul?

[Transcript missing]