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Vice President of Handango comments on latest changes January 18, 2005 [General] | By Edward J. R. "That's how I discovered PR doesn't work and that markets are conversations." --- a quote from "The Cluetrain Manifesto: The End of Business as Usual" by Doc Searls and others. * * * * * Apparently not only Microsoft but also Handango starts understanding that times have changed, paradigm has shifted, and now companies must carry out converstations with their customers, and not just use PR (Public Relations) officers and mainstream press. * * * * * Handango is de-facto the biggest online shop with mobile software and apart from being middlemen they offer also software delivery platforms for mobile phone operators and carriers. Since they are the biggest, obviously there is a lot of controversy around them. Lately Handango has introduced changes that include among others disallowing links to external websites in software descriptions at Handango. These latest changes caused a lot of aggravation among developers, which apart from consumers and network operators constitute customers of Handango. Clint Patterson, who is a Vice President of Marketing at Handango has answered in our discussion forum some questions regarding these latest changes. A quote from his answers: * * * * * I'll try to address a number of these comments and questions. 1) Support. If you're having trouble reaching someone, please email me personally at clint@handango.com. We were out yesterday in observance of Martin Luther King Day, so if you submitted an issue on Friday, three business days would be Wednesday for a response. We do have a team of more than 10 folks answering customer questions every day (they sit right across from me!). 2) Our rates. We pay developers 60% of gross revenues for sales on Handango-branded sites (.com, .co.uk, .de, .com/fr, etc). We pay 60% to 50% of gross revenues on partner-branded sites (e.g. Microsoft, Dell, HP, AOL, AvantGo, etc) depending on sales volume ($50,000 is the threshold). We pay 70% of NET revenues on wireless sites (e.g. Sprint, T-Mobile, Orange, Cingular, etc). 3) Competitor rates. (I'm not the authority here.) PocketGear pays developers 70% to 60% - depending on your level with them - of NET revenues for sales on PocketGear branded sites. For sales on their partner sites (for example, the affiliate links from msmobiles.com), sales are paid at a rate of 60%, I believe. Other competitors offer different rates some are higher (Jamba in Germany pays 50% of net revenues) and some are lower (a new site just lauched that pays 75% or thereabouts). Physical retailers will generally take 50% of revenues in addition to marketing and inventory management fees. 4) Rate comparison. Because some competitors pay based on NET revenues in all cases, the comparison is difficult unless you know exactly what fees will be deducted. In general (depending on how much you sell and where), Handango commands a premium over online competitors. We also deliver many more visitors and sales. This seems in line with other industries. For example, you pay more to advertise in the New York Times than the Des Moines Register (Sorry for the American examples! I'm not too good on the names of newspapers in rural Germany!). 5) What we do for developers. We provide a wide variety of services. We build and maintain more than 100 sales channels (the ones mentioned above - Microsoft, Orange, Dell, HP, etc) for developers, bringing the largest group of customers in the world to see their applications. We provide support for customers. Most developers never see the issues we handle on their behalf, but it equates to roughly 10 issues for every 1 they see referred from us. We cover all fraud expenses. If a developer's application is purchased fraudulently, Handango eats the cost and does not debit the developer's payment for this amount. This was a six-figure expense last year. We provide a host of marketing opportunities (in-box CDs/MMC cards, promotions, portal inclusion, etc) to developers on a regular basis. We provide free testing services for inclusion in operator portals. This is only a partial list of some of the more important and unknown items. If you'd like a more exhaustive list, I'm happy to provide one if you email me. 6) Market share. Anyone who has researched this industry knows that there are literally thousands of sources to purchase mobile software. There are more than 10 different online competitors to Handango, hundreds or more developer sites, dozens of operator and device manufacturer portals, hundreds or thousands of physical retail stores. New sources emerge every month. Handango may be the largest, best and best known, but that does not mean that we stand alone in this vibrant marketplace. Thanks for the comments and questions. Please let me know if I can provide further clarification. Best regards, Clint Patterson Handango * * * * * Related links:
Conclusions: let's keep these conversations going! One is for sure: new companies are launching shops with mobile software soon and the situation on the market will be even more competitive then. Big changes are coming and one is for sure: only with such conversations, companies can keep up with needs of their customers. Cluetrain Manifesto has become reality for many companies and the rest will have to face losing market share and customers...  Post your comment (free registration is required to post, but if you register you can edit your posts later) [ 1 Comment ]
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