Diminishing Returns

NPD’s 2010 Security Software Topical uncovered some interesting trends this year, some of which we released in a press release today, but some of the other tidbits require a little more nuanced reading into the last 3 years of data.

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Fighting The Installed Base Battle

Microsoft released the consumer version of Office 2010 to retail a few weeks ago, and according to NPD’s Weekly Tracking Service the results are mixed. Units and dollars are down from Office 2007’s initial two weeks of sales but are in line, and in fact slightly ahead of, sales trends of Office 2007 so far this year. This fact highlights the challenges for Microsoft going forward for Office. A strong product launched into a saturated market faces considerable headwinds. Even so, sales of Office 2010 in general have to be characterized as a bit disappointing during the first two weeks.
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Customers Know Best

Those of us in retail and consumer marketing are often confronted with this truism. And while consumers are the ones plunking down their hard earned money on the latest (or cheapest) tech gadget, we in the business often think we know what the consumer wants better than the consumer does. Sometimes we are right, and then sometimes we are wrong. And the best companies move to take advantage of that customer feedback and can accept that sometimes their initial marketing or sales tactics missed the mark.
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SMBs Looking To Upgrade

A couple of months ago we talked about some distribution and reseller sales statistics which indicated that, at least as we exited 2009 sales growth had begun to pickup in the SMB focused channels that NPD tracks besides retail. As we are now through the first few months of 2010 we have seen this trend continue, in both our Distributor Track and our Commercial Reseller Tracking services. In both, revenue is tracking towards 2008 levels and showing substantial revenue growth over the depressed levels of 2009.
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I Don’t Trust Digital Stuff

That sentiment is not mine, but it is one that comes through loud and clear from NPD’s latest Online Software Purchasing Report. And while it may be a stretch, these findings may also offer us some insight into consumers’ acceptance of owning virtual content going forward. Consumers are clearly used to buying (and renting) things digitally, iTunes is the largest music store in the U.S. according to NPD, and Netflix streaming is undeniably rocketing in popularity as it is incorporated into more and more devices. But strangely it always feels that computer software remains behind the adoption curve. Sometimes it’s bandwidth, sometimes it’s security, sometimes it’s awareness (or just plain interest), and sometimes it’s just comfort; but consumers desire to download real productivity software is clearly behind where they are in getting their other virtual content.

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When Traffic Makes Us Happy

In our private lives we all despise traffic. It slows us down and deprives us of making full use of our time. Too much (fill in the blank) in too little space. In our professional lives as a retail tracker we have the opposite view … traffic is good. Retailers love traffic. Sellers love traffic. Crowds are great. We all want more and more shoppers, because we all know more shoppers lead to more buyers.
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Why Sales Matter Most

I admit to being biased. I work at a company that tracks actual sales results and I spent 10 years at retail. I have always lived and breathed sales results. And while shipments are a great tool (and I worked at a place that tracked those as well), the final verdict of success or failure of an item is sales. If a consumer puts down their hard earned money for a product you can be sure that they saw some spark of value or usefulness to their lives in that device. That is why it is shocking to me that many folks in this industry don’t understand the difference between sales and shipments - and often confuse them in the most basic ways. The latest example is a report this week in DigiTimes and repeated all across the web that the Barnes & Noble Nook out-shipped the Kindle in March. Note I said, and DigiTmes said as well, shipped, not sold. This has caused shock and disbelief throughout the blog community. We will now hear for a few days about how the Kindle is doomed; the iPad is killing it, and various other conspiracy theories.
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Retail Is Detail

In last week’s frenzy of iPad news it is entirely likely many folks missed the revelation that Microsoft is looking for employees for two new stores to open later this year. New stores do not mean that the concept has proven totally successful, just that Microsoft has seen enough to warrant further experimentation. If you’ve ever been involved in the rollout of retail stores you know that it is hard to keep changing the in-store experience on the fly so, to Microsoft’s credit, they have gone slow in expansion, and of course they can go slow since this is not their primary business, likely gathering up all they learned from their first stores and hoping to improve on the experience in the next two.
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Collateral Damage

Reading the first set of reviews of the iPad I have been struck by one comment: That this is a notebook killer. Our recently completed iPad survey also revealed a considerable amount of overlap in consumers’ perception and usage intentions between the iPad and the notebook. Now, with the first reviews in, our initial assumption in our first iPad blog post appears more correct than ever - the iPad is aimed squarely at the heart of the notebook market. And while we mentioned in that post that the lack of certain features might prevent a direct cannibalization, the initial reviews indicate that, even without those features such as Flash support or a camera, this product can take over much of what your notebook does, and do it more elegantly and more comfortably.

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Preaching To The Converted

As we near the release of the next market-changing device (maybe!) from Apple, NPD has released some interesting numbers from a new survey Apple iPad: Consumers’ Perceptions and Attitudes. The good news is that awareness among the general population for the iPad is unbelievably high. Almost two-thirds of all respondents were aware of the product with that number ranging from a low of 61 percent among 55–and-older consumers, to more than 80 percent of consumers who owned another Apple branded product. Among the most aware demographics; young people, $100k income earners, and current Apple product owners not only was general awareness high but ownership interest and purchase intent over the next six months were much higher than overall. More than one-third of those expressing interest in the iPad in both the 18-34 year old demographic and among Apple owners claimed they intended to purchase the device in the next six months. Among the high income earners intention to buy in the next six months was more than 50 percent.

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