The software outlet store- several new channels in one

I recently drove about 1200 miles north on Interstate 95 from Florida to the northern tip of New Jersey.  One thing this trip does not lack are outlet stores... and there are some great ones along the way.  I was thinking about the outlet concept and wondered why this wasn't done for software.

Outlet software would need to meet a couple of requirements to make this successful. First, I would only do this for products where there is a compelling reason to upgrade.  If you don't have a strong enough reason; create one.  But be aware that you'll have to drop the price to make the argument.

The marketing

• Lower software prices- you will have to price the software based on the perceived value of the major features and value path you can offer on the upsell.  Selling last year’s anti-virus definitions won’t work. 
• Core (key) functionality- The main point of the sale must still get across.  Music players must play music, movie software – movies and presentation software should be able to be presented.  Limit the features or highlight the upgrade during user interaction and let the product sell itself.  
• Captive Audience- Many 30 day trial downloads don’t even get installed.  The user who pays for the software is much more likely to use it. 

The upgrade path

In order to make this successful, the upgrade path needs to be clear with a compelling sales pitch.

• In-product purchasing takes the customer straight into the cart
• A condensed shopping cart cycle closes the deal in a few clicks - think one page checkout.
• Instant gratification is a must: immediate key delivery and in-place upgrades

You can offer a few core features for $1-$5 or last year’s version from $15-$25 and create a new selling opportunity.  

Value based pricing in a value driven economy.