The traditional approach to Google Adwords is to set a bid price for each keyword. This is known as Cost Per Click (CPC). Google then then uses the bid prices in conjunction with a secret formula (the quality score) to decide how high to rank your ad in the Adwords results. If you bid more, your ad will appear higher and typically get more clicks, but your cost per click will increase. So setting an optimal bid price is important. Bid too little and you won’t rank high enough to get a decent number of clickthroughs. Bid too much and you will potentially end paying more to Google than you recoup in sales.

An alternative approach is to tell Google Adwords how much you are prepared to pay for a particular action, e.g. a sign-up, download or sale. This is known as Cost Per Action (CPA) or Conversion Optimizer. Google will then automatically calculate your bid prices and attempt not to exceed the CPA you set (although this isn’t guaranteed).

CPA sounds great. I can stay in bed a bit longer while the mighty Google brain does the bid tweaking for me. Unfortunately I wasn’t able to use CPA. I  count sales as conversions (not downloads) and I have my adwords account split into a number of campaigns by geographic region and by type (e.g. search vs content). Having my campaigns structured like this, rather than one monolithic campaign, makes for more flexibility (e.g. different ads, phrases and bid prices for different geographical areas) and more useful reports (e.g. separate reports for search and content). But it also meant none of my Adwords campaigns made the minimum threshold for conversions per month.

When Google dropped the minimum threshold for CPA to 30 conversions per campaign per month, one of my Perfect Table Plan search campaigns became eligible. So I did an experiment. I ran a campaign for 4 weeks using CPC, then 9 weeks using CPA, then another 4 weeks using CPC. I set the CPA bid to roughly the average cost per conversion I got for CPC. I was curious to see if Google would find sweet spots that I had been missing or whether they would bid as high as they could to take as much money off me as possible. Summary: CPC outperformed CPA on all key metrics, including: 4.4% higher conversions, 9.4% lower cost per conversions and 8.0% higher profit.

The detailed results are as follows:

In graphical form (click to enlarge):

Notes:

• The values given are taken by computing (CPC metric – CPA metric)/(CPA metric). E.g. ROI of +10.4% means that CPC had a 10.4% higher ROI than CPA.
• Only a single (geographically based) search campaign was measured. The total number of conversions during the time period of the test was in 3 figures.
• I only measured sale conversions. This gives me less data than measuring downloads, but I think it is unsafe to assume the number of downloads correlates closely to the number of sales.
• The PerfectTablePlan sale price is £19.95/$29.95. To calculate profit I only counted 75% of the price of a sale (the other 25% was assumed to cover the cost of support, ecommerce fees and other overheads associated with the sale).
• Each of the time periods was a multiple of 7 days to avoid any issues with different results on different days of the week.
• I ran CPC for an equal amount of time either side of the CPA test to try to balance out any seasonal factors.
• Google conversion tracking uses Cookies and is therefore not 100% accurate.
• PKI is Profit Per Thousand Impressions.
• ROI is Return On Investment.

It wouldn’t be wise to draw any sweeping conclusions from one test with a limited amount of data. However I believe the results show:

• A CPA campaign running for 9 weeks wasn’t able to outperform a mature CPC campaign. The CPC campaign had been running for over 4 years, but one would have thought CPA would have been able to use that pre-existing  data. CPA might have performed better if given longer. It would probably also have done better against a less mature CPC campaign.
• Google didn’t rob me blind using CPA bidding. The CPA cost per day was only 5.5% higher.
• The results weren’t hugely different. On the basis of the above results one might still conclude that CPA is superior to CPC as it requires less time to manage.

I was busy programming a few days ago when the machine froze for a few seconds, followed by an error message from the Intel Matrix RAID controller than one of the harddisks in my RAID1 (mirrored) pair had failed. Damn. This is the second time this has happened on this machine in the 2.5 years I have had it. I don’t seem to have much luck with harddisks. It might not be coincidence that it happened on one of the hottest days of the year. I removed the defective disk and put in an identical spare I had bought for such an eventually and rebuilt the RAID1 pair from the surviving harddisk. I felt quite pleased with myself.

A  couple of days later the same error message appeared. The new disk had apparently failed. Double damn. I rebooted a couple of times. No joy. It seems unlikely that an unused disk would fail within 48 hours, perhaps it is the RAID controller? I updated to the latest Intel Matrix RAID driver and swapped the two disks around. It still wouldn’t recognize the newly added harddisk, so it seems the new disk really is defective. I swapped the working disk with the harddisk that had failed a couple of days ago. The ‘failed’ harddisk booted OK! Something strange going on here.

I could probably send the failed disk back to Seagate, but I am simply not prepared to risk my sensitive data to save myself £50. I tried to order another identical harddisk but, inevitably, the identical model isn’t available 2.5 years later. The disks are:

SEAGATE BARRACUDA 7200.10 ST3500630AS 500GB 7200RPM 16MB SATA-300 3.5"

Apparently the .10 is the generation number (thanks to Dennis on the ASP forums for that).

I am currently running the machine on the one good harddisk, being very conscientious about my backups. I am undecided what to do next.

1. Order a 7200.12 disk and see what happens when I plug it in.
2. Replace the RAID controller. I believe the Intel Matrix RAID controller is firmware on a chip on the motherboard, so replacing it doesn’t sound like much fun. And it isn’t clear that it is the cause of the problem.
3. Buy a new PC. This one is only 2.5 years old and it means stumping up a load of cash and all the hassle of moving everything over. I would rather wait until Windows 7 is released before I buy consider buying a new machine (I am thinking about getting someone like overclockers.co.uk to build me a lean, mean, 64-bit, compiling machine).

Option 1 sounds like the easiest and cheapest options. Any other ideas? Is it safe to pair a 7200.10 and a 7200.12 of the same size for RAID1?

I have been an enthusiastic user of Deeptrawl since the first beta was announced on the BOS forum. I run DeepTrawl on www.perfecttableplan.com every time I make major changes to ensure that there are no broken links, missing images or other website bugs. It has saved me quite a few potentially embarassing mistakes and helped me sleep a bit sounder at night. So I was very pleased when the author, Jonathan Matthews, asked me to do a day of consulting to assist in his efforts to move DeepTrawl sales to the next level.

The consultation ran to two long phone calls, lots of emails, some research and testing and a report with 21 pages of recommendations covering areas including: licensing, pricing, SEO, website, promotion, Adwords and usability. Here is what Jonathan had to say about the process:

I approached Andy Brice to do some consulting specifically because I wanted to increase sales largely through improving my marketing efforts.

Andy’s approach is one which I think those from a coding background will appreciate. From the first phone call it was clear his process was refined and methodical: not concentrating on fluffy marketing fads but rather on solid proven methods.

Throughout the consulting process it was clear that Andy was taking all the positive and negative marketing knowledge he gained making his own product successful & applying it to create unique recommendations for my own product.

The final report was delivered before the due date & on budget. Reading the report I was stunned by the wealth of information it contained. The report doesn’t just contain dry facts & statistics, the emphasis is clearly on actionable points. Reading Andy’s justifications for making his recommendations it’s clear that implementing them will ratchet up the effectiveness of my marketing efforts one step at a time.

My conclusion is that Andy’s consulting is probably the most cost effective investment I will ever make in my business; I fully expect the expenditure to be repaid many, many times over.

Jonathan Matthews, www.deeptrawl.com

If you have a website that runs to tens or hundreds of pages that you need to QA, I would definitely recommend  giving DeepTrawl a try. To sweeten the deal Jonathan is offering readers of this blog 20% off until the end of July (go to the buy page, click a ‘buy now’ button, then click ‘the checkout’ button, then enter the coupon code: successfulsw01 ).

It is often hard to know what sort of additional services customers will be interested in. Might they be interested in:

• a yearly subscription instead of a one-off payment?
• hosting their own server?
• paying extra for 24 hour support?
• a port of your product to Mac OS X?

You can implement the new service and then offer it to customers. But this can be a huge waste of time and money if it turns out nobody wants it. An alternative approach is to borrow the idea of “Lazy instantiation” from programming (also called RAII – Resource Acquisition Is Initialization).

Programs need to initialise various system resources, such as databases, files and hardware devices. It is generally considered good practice to only initialise these resources as they are needed. This is called “lazy instantiation” and results in faster start-up times and no wasteful initialisation of resources that turn out not to be needed. For example in C++ (glossing over various details of cost, smart pointers, copy constructors, error handling etc to keep the example code simple):

So we can only access the resource by calling MyClass:getResource(), it will get initialised on first use and it will be cleaned up when MyClass goes out of scope. This much more elegant, efficient and less error prone than always initialising the resource at start-up or adding lots of checks throughout the code to see if the resource is already initialised.

A similar approach can be applied to marketing. For example, instead of spending days sorting out the intricacies of subscription payments, you just add the following to your purchase page:

Please email support@acme.com if you are interested in purchasing an annual subscription instead of making a one-off payment.

This will take you a few minutes. If someone emails you that they would prefer a subscription you reply along the lines of:

Thank you for your interested in purchasing Acme server via an annual subscription. We are currently assessing the commercial viability of a subscription approach. We will contact you if and when we decide to make Acme server available through annual subscription. But, for now, you can only purchase Acme server through a one-off payment, as detailed on our purchase page. … etc

If you get enough interest you go ahead and do the work to implement subscription payments. If you don’t – well, you didn’t waste much time on it.

MyClass::MyClass()
{
   myResource = NULL;
}

MicroISV blog aggregator planetmiscroisv.com has died, for reasons unknown (Floyd, if you are reading this, I hope you are OK). Glenn Rice of backupbrain.com.au has kindly filled the gap with new aggregator microisvcentral.com. Thanks Glenn! Hopefully he will be able to fix the problem that is causing posts from this blog to not be displayed properly.

I scanned the Microsoft ad below from a recent QBS catalogue.

click for larger image

I am still struggling to understand the underlying message. Use Team System and Microsoft will get its tentacles around you? I don’t know which is more unlikely, the basketball playing Cthonians or the athletic and good looking development team.

I have been using a Mac mini to port my C++/Qt based code to Mac OS X for the last 3.5 years. This is one of the early PowerPC based Mac minis, upgraded to 1GB of RAM. Being Apple hardware, it is expensive for what you get. But it has served me well. The small form factor (approx 17 x 17 x 5 cm) has also been useful in my cramped office, where I have it attached to the same monitor, mouse and keyboard as my Windows box through a KVM switch. But it is struggling to keep up with PerfectTablePlan’s ever increasing code base. A clean build of the PerfectTablePlan source into a Universal (fat) binary now takes an eye-watering 36 minutes to compile and link on the Mac mini. Building a PowerPC-only debug version still takes nearly half that time. That is painful, even just for occasional porting work.

As my main development environment is Windows, I can’t really justify the cost (or office space requirements) of a Mac Pro. So I decided to buy a new Mac mini, with an Intel Core 2 Duo processor. I did look around to see if I could find one at a discount. However, this being Apple hardware, no-one dares sell  at anything significantly less than Apple’s RRP. I bought the smaller (120GB) disk variant and had the dealer upgrade it to 2GB RAM, which tests on my old Mac mini indicated should be plenty for compiling and linking. I didn’t want to do the memory upgrade myself as I know, from experience with my first Mac mini, that removing the case involves putty knives and some very worrying cracking noises.

I had all sorts of problems trying to get the right cables. Firstly I wanted a Firewire cable so I could copy the set-up across from the old machine to the new machine using Apple’s Migration Assistant software. But it turns out that the old Mac Mini has a Firewire 400 6-pin socket, whereas the new Mac Mini has a Firewire 800 9-pin socket. I ordered a 6-pin to 9-pin Firewire cable cable. Then I discovered that there is more than one type of DVI cable. The old Mac mini was attached to my KVM switch with a DVI-I cable. The new Mac mini only accepts mini-DVI or (via a supplied adaptor) DVI-D. So I ordered a dual link DVI-D to DVI-D cable as well.

Once I had the right cables things went relatively smoothly. The Migration Assistant software copied almost all the apps and data across from the old machine to the new one. It even preserved settings for the apps, e.g. the email accounts in my Thunderbird email client. I just had to re-install XCode (which wasn’t copied across) and rebuild my Qt libraries (to avoid copious warnings due to the fact they had been built with an earlier version of XCode/gcc).

To use the migration assistant you simply:

1. connect the 2 machines with a Firewire cable
2. start-up the old machine with the ‘T’ key depresses to put it in ‘Target’ mode
3. start-up the new machine
4. follow the on-screen instructions

Nice. If only it was was that easy to set-up a new Windows machine.

A quick test shows that the new Mac mini is nearly 6 times faster at compiling and linking a Universal binary of PerfectTablePlan from scratch[1]:

The time the new Mac mini takes to compile and link an Intel-only debug release of PerfectTablePlan also compares favourably with a similar build on my Windows 2.13 GHz Intel Core 2 Duo box with 4GB of RAM[2].

This isn’t a fair hardware comparison, as the two machines are using completely different compilers and linkers and the Windows box was running various background services. But it certainly shows that Intel-based Mac minis are worth considering for use as development machines.

[1] The newer machine is using a newer version of XCode/gcc.

[2] The Windows box is using Visual Studio 2005.

TrialPay is an interesting idea. In basic terms:

• merchants (e.g. microISVs like me) want to sell products, such as software
• customers want to get a product without paying for it
• advertisers (such as Netflix and Gap) want to sell their goods

TrialPay brings the 3 together by letting the customer get the merchant’s product for ‘free’ by buying something from the advertiser. The advertiser then pays the merchant, with TrialPay taking a cut. The merchant gets paid, even though the customer might not have been prepared to pay the price of their product. The customer gets your product ‘free’ by buying something else, which they might have wanted anyway. The advertiser gets a new customer. TrialPay get some commission. Everyone is happy. I decided to give it a try and signed up in October last year.

I decided not to mention the TrialPay offer on my main payment page. I could visualise eager potential buyers of my table plan software, credit card in hand, being distracted by the TrialPay ‘Get it free’ logo. Off they would wander to the TrialPay pages and become so engrossed/confused/distracted by the offers there, they would forget all about my product. Sale lost. Instead I modified my Inno setup Windows installer to pop up the following dialog when someone uninstalls the free trial without ever adding a licence key:

If they click ‘No’ the software uninstalls. If they click ‘Yes’ they are taken to the PerfectTablePlan TrialPay page. I hoped that this would entice some of those who had decided not to part with $29.95 to ‘buy’ PerfectTablePlan anyway through TrialPay.

TrialPay allows you to set the mimum payout to any level you like. You can also vary the payout by customer country (e.g. less for poorer countres). The lower the minimum payout you set, the more advertisers deals are available to customers (and presumably the higher the chance of a conversion).

The Minimum Acceptable Payout (or MAP) is the lowest amount you are willing to accept per transaction and determines which advertiser offers are available to your customers. The lower the minimum, the more offers that will appear for your product and the more likely a user is to find an offer that compels him to complete his transaction. While you may set a low MAP, your average payout will greatly exceed the minimums you set. (from the TrialPay website)

It quickly became apparent that very few advertisers offer deals that pay the $29.95 I charge for my product (possibly none, in some countries).

I set a minimum payout of $25 in rich countries and $20 in poorer ones. After a few weeks with no TrialPay conversion I reduced the mimum payout to $20 in rich countries and $15 in poorer ones. TrialPay suggested that a $2 minimum payout was optimal in Africa and Central America if I was accepting $20 in the USA. $2? I don’t think so. That doesn’t even cover the cost of answering a support email. Especially if they aren’t a native English speaker.

I also gave the TrialPay option a mention in my PerfectTablePlan newsletter. Most of the recipients already have licences, but I hoped that that they might forward it to friends and colleagues.

The results to date have not been encouraging. Lots of people have gone to the PerfectTablePlan TrialPay page (approximately 1 for every 10 downloads), but the conversion rate has been dismal. The total number of TrialPay sales since I signed up over 7 months ago is two, for a total of $43.60. That certainly isn’t worth the time it took me to sign up, modify the installer and test the ecommerce integration with e-junkie. I am not sure why the conversion rate was so poor:

• The TrialPay landing page isn’t compelling enough?
• The advertiser offers aren’t attractive enough?
• The concept of TrialPay is too complicated?
• People are suspicious of ‘free’?

TrialPay’s poster child LavaSoft claim an impressive  5,000 additional sales per month through TrialPay. At $26.95 per licence this is an additional $1.6 million per year. But the numbers look a bit less impressive on closer inspection. 5,000 additional sales/month from 10 million visitors/month is only an extra +0.05% conversion rate[1]. And TrialPay probably didn’t pay out the $26.95 per licence Lavasoft normally charge. It is also noticeable that TrialPay only seems to get a mention on the download page of their free product, not the products they charge for.

Obviously the only way to know for sure whether TrialPay will work for you, is to try it. Your results might be very different from mine. If you do still want to try TrialPay, you can find out some details of how to integrate it here [2].

[1]I am being a little unfair here, as the quoted 10 million visitors probably aren’t just for Lavasoft’s Ad-Aware product.

[2]Note there is a bug in some older versions of Inno setup which means you can’t continue with the uninstall if they click “No” when you display a dialog, as shown above. So, if you are using Inno setup (which I recommend highly), make sure you are using v5.2.3 or later.

I was recently interviewed by Bob Walsh and Patrick Foley for The Startup Success Podcast, episode 25. We cover a wide ange of topics including: microISVs, conversion ratios, being specific, PerfectTablePlan, usability, the global recession, software award scams, ‘works with vista’ certification, stackoverflow.com and twitter. I wonder how much I have to pay them to edit out the ‘ums’?

Download the MP3

Working as a micro-ISV needs lots of different skills, but no-one can have all of them. When you’re developing a software product for your independent venture, it’s easy to lose sight of some issues, just because there are so many of them to cover, and so few hours in a day. I realised that to help me re-focus and prioritise the key tasks after the code was complete needed the catalyst of a fresh pair of eyes, to verify or change the plans I had. Simply chatting to a knowledgeable professional made all the difference to perspective and priorities. I was expecting that from Andy Brice, as I’d read about his work with other micro-ISVs. What I wasn’t expecting was his breadth of business knowledge as well as his technical knowledge. Being able to discuss business objectives, markets, pricing, promotion as well as SEO and coding was a great punctuation point in the development of the Reserviz online service, and it helped me develop a much more focussed set of priorities to complete the initial launch period. Don’t expect from Andy a glib confirmation that everything you’ve done is fine – he’ll give you an honest assessment, and then help you work out a plan. Think of Andy as the Swiss Army Knife you need in your toolbox!

Mike Gorman, www.Reserviz.com

I have been doing some consulting for Mike Gorman of Quartile Software on Reserviz. Reserviz is an online service for booking rooms, people and other resources. I have primarily been helping Mike with positioning (deciding which vertical markets to focus on), online marketing (including SEO and Google Adwords) and testing the usability of the website. It was a slight departure for me, as most of my experience is with desktop apps. But it just proved that the vast majority of what is true for the marketing and usability of desktop apps also applies to web apps.

I think Reserviz has a very attractive website with a nice balance between simplicity and flexibility. If you know anyone who is still using a tatty old appointment book? Tell them to checkout Reserviz for simple online appointment and resource booking (first month free!).