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"competitive upgrade" - is it ethical?

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40hz:
Here is a thought:
What if I offered my customers 50% of their money back if they switched to a competing product? Sounds crazy? What do you think?
-vlastimil (January 12, 2011, 04:19 PM)
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In the absence of more detail?  :huh:

Yes. It sounds crazy.  ;D

How would you see that work for you? I'm not sure what message you would be trying to convey by doing that.

--/--

BTW: exactly what is your product? How about a weblink? Are you the same vlastimil that has apps up on the RealWorld Graphics website? :)

app103:
Funny thing about competitive discounts...they don't prevent you from using the original application. They only make the competing application cheaper.

If I already am a user of Product A and take advantage of the discount on Product B, then I will have both A and B and be able to use both for whatever they are best suited for. And if I am entitled to lifetime free upgrades on both products, then I am the winner here, able to switch back and forth between applications as each improves and pulls ahead of the other.

If you are going to view the whole thing as a game of tug-of-war between developers, then understand that the user is on both teams if they take advantage of the offer for a competitive discount.

Offering a discount like that doesn't mean you will automatically gain users. It means that it might get users to at least download, install, and try your product. They may decide during the trial period that they don't like it and would rather stick with what they have, meaning they won't take advantage of your offer.

And your competition offering a discount doesn't mean you will automatically lose users, for the same reason.

So, ultimately, don't worry about the other guy offering a discount. Counter it with the same kind of offer to his users if you want, but work on making your application the best it can be and service to your customers the best it can be, because in the end, that's what really counts.

Carol Haynes:
Trouble is where the big boys go the tiddlers follow (just look at activation methods for software).

Loads of big companies use/have used this as an incentive to steal customer eg. Corel Word Perfect Suite X can be bought at upgrade price if you have owned Microsoft Office XP or later.

There are similar deals from leading graphics companies etc.

It isn't really surprising it happens as the dollar/euro/pound/yen or whatever is king in business. It shouldn't be but it is.

Ethical? Not in my view but then who said business is ethical - the definition and obligations of a US corporation is to be as unethical as it can get away with.

My approach is to offer something different ... For example, I am building desktop computers for customers (for some reason I have had a sudden rush of orders). I can't compete with big box shifters and huge conglomerates in terms of rock bottom prices BUT I can offer a customised service that means the computer is built precisely the way the customer wants, it is delivered personally and set up at their home/office and generally I find I can offer higher spec products, with quality known brand components at similar price to off the shelf boxes. The other advantage is if the customer has a problem I am based down the road, they have my email address and phone number, they know where I live! So I have to get it right, and for the odd inevitable problem I fix it quick.

Attention to detail means I get lots of local recommendations.

OK the big businesses make a lot of money - but I am making a living and enjoying and feeling proud of what I am doing.

Darwin:
So, ultimately, don't worry about the other guy offering a discount. Counter it with the same kind of offer to his users if you want, but work on making your application the best it can be and service to your customers the best it can be, because in the end, that's what really counts.
-app103 (January 13, 2011, 11:11 AM)
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Excellent point, app. This is my view/advice as well.

vlastimil:
I'm not sure what message you would be trying to convey by doing that.
-40hz (January 13, 2011, 09:17 AM)
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The message could be: I (the author) am dedicated to keep the software top quality, if I fail and a competitor makes a better product, I'll give you some money back ... maybe min(competitor_price, 50% of paid price). And/or: buying this product is safer than the competing ones, if I (the buyer) make a decision that turns out to be wrong in the future, I get at least some of my money back.

I am not really a marketing type of person, so this may be a complete nonsense, or plainly not worth the effort.

(I did not want to post any links to keep the discussion as neutral as possible, but you guessed right.)

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