From the March 6, 1995 issue of Smart

Growth Predicted for Presentation Programs

By David English

Presentation software is a small but growing piece of the software pie. Much of the growth in the category is being fueled by multimedia-based presentation programs. While presentation programs with multimedia represented only 0.95 percent of all multimedia software programs in 1993, sales of these programs are expected to increase 143 percent from 1993 to 1997, according to Dataquest.

Sales of stand-alone presentation programs—including both multimedia and non-multimedia programs—are actually declining because of the continued shift in sales to suites. According to projections from Dataquest, worldwide shipments of stand-alone presentation programs will decline 8 percent from 1993 to 1998, from 3,228,000 units to 2,962,000 units. Shipments of suites, on the other hand, will increase 92 percent over the same period, from 3,543,000 units in 1993 to 6,806,000 units in 1998. Dataquest estimates that for 1994, Microsoft had 86.3 percent of the suite market with Microsoft Office, and Lotus had 13.3 percent of the suite market with Lotus SmartSuite. Each suite include a presentation program that's also available as a stand-alone package: Microsoft Office has PowerPoint, and Lotus SmartSuite has Freelance Graphics.

Almost all presentation software is sold to business—few individuals have the need to give formal presentations—and it's one of the few business categories that can match the dramatic growth of the entertainment and educational software categories. "While multimedia in 1994 largely represented consumer household purchases, the business purchase will grow from a relatively small market today to a very significant one tomorrow," says Michael Moon, partner of GISTICS, a research firm in Larkspur, CA. "Multimedia presentations, sales aids, and employee communication represent three of the largest business applications today, underscoring the pragmatic need to communicate more effectively in a variety of situations in which multimedia can make a dramatic difference."

A Need to Communicate
The market for presentation programs has split into two camps of potential customers. On one end are the casual users. These are often administrative assistants and owners of mom-and-pop businesses who occasionally need to create a presentation. Many of these buyers will purchase a presentation program as part of a suite with the intention of trying it out someday. They are less likely to buy a presentation program as a stand-alone package. Recent versions of Microsoft PowerPoint, Lotus Freelance Graphics, and WordPerfect Presentations have added ease-of-use features and ready-to-use templates to attract the occasional user.

For the other group of potential customers, creating presentations is a significant portion of their jobs. These customers include sales, training, and graphics professionals who use presentation programs every day or several times a week. This group is attracted to powerful programs, such as Aldus Persuasion, that integrate well with other high-end programs. This group is willing to buy a stand-alone presentation program if convinced of its capability.

Market Driven
How a software vendor markets its presentation program can tell you which group the company is targeting. Lotus is promoting Lotus Freelance Graphics 2.1 as an easy-to-use component of Lotus SmartSuite Release 3 for Windows. According to the company, its in-store display acknowledges the consumer's preference to compare competing products by category, rather than software publisher. The display includes laminated product information sheets that show each component part of the suite with a brief listing of its features. The merchandising program includes shelf talkers and shelf managers, end cap displays, and weekly merchandising visits to check that the displays are well maintained. "We want to ensure that when customers walk into a retail establishment, they are presented with the product information they need to quickly and easily identify the benefits of Lotus applications," says Charlie Hamlin, Lotus vice president of marketing. "Our retailers, who share these objectives, are responding enthusiastically to the program." Lotus' SmartSuite display is currently being used in CompUSA, Computer City, Elek-Tek, Micro Center, and Fry's.

On the other hand, Aldus, now part of Adobe, is positioning Aldus Persuasion 3.0 as a powerful cross-platform package that gives customers precise control over its features. Lacking a suite, Aldus plays up Persuasion's integration with the company's other stand-alone programs, Adobe Photoshop and Aldus PageMaker, and includes profiles of professionals who are using the program in highly technical disciplines. The strategy must be working, as the company reports that 40 percent of the people who use Persuasion also use Photoshop. "We have so many products, and they cross so many business categories that we aren't focusing on a particular product but Adobe as the total solutionand Persuasion fits into that," says JoAnn Carney, senior channel merchandising manager for Adobe. The company has built a substantial position in the educational market for its products and has developed a booklet called "Opening Doors," which is "a direct mail and convertible POP that we send to all the educational resellers," Carney says.

Kiosks Flourish at Retail
Think of kiosks as interactive presentation programs for retailers. Essentially stand-alone electronic information centers, kiosks can provide an excellent way for retailers to present product information in a store setting.

With the advent of ATM machines and personal computers, people are becoming increasingly comfortable with interactive technology. Inteco, a Norwalk, CN, multimedia research firm, predicts that installations of multimedia kiosks will grow from less than 50,000 units in 1993 to 358,000 units in 1997. Frost & Sullivan, a research firm based in Mountain View, CA, sees compounded growth for kiosks of 22.2 percent from 1993 through 1999 and then a gradual decline (0.4 percent in the year 2000) because of competition from interactive online services.

As reported in our first issue, Best Buy is using kiosks, called Answer Centers, in its new Concept III stores. The Answer Centers provide voice and video explanations of the products in the store—with special emphasis on explaining computer hardware. New product features and current prices are downloaded directly from the corporate headquarters in Minnesota.

Lee Apparel uses a kiosk at R. H. Macy's in New York to attract young male shoppers to a 30-second animated commercial. The kiosk includes an interactive sequence that lets a boy enter his height and weight and see the appropriate jean size. "We feel interactive point-to-purchase displays will be everywhere," says Kevin Mitchael, director of visual marketing for Lee. "The possibilities for delivering information with this medium are unbelievable."

The new Levi's retail stores use kiosks to provide both customers and staff with views of color swatches, seasonal colors, and styles, as well as to answer questions about size and availability. The system takes this information and merges it with Levi's marketing messages and current advertisements to help maintain a consistent corporate image. The company hired an outside developer who used Macromedia Director, an off-the-shelf multimedia authoring program. While Director is powerful enough to create nearly half of the commercial programs on CD-ROM (including Iron Helix and The Journeyman Project), it's easy enough for most programmers—and even some dedicated non-programmers—to master. According to Macromedia, about 15 percent of its business comes from kiosk development, shared equally between Director and Authorware Pro.

Should you create or commission your own in-store kiosk? A recent market report from Inteco says that many smaller retail stores are disappointed with kiosks because startup costs can be high and the units take up valuable floor space. Larger stores are more willing to devote the money and space necessary to project a high-tech image. And don't expect kiosks to replace your sales staff. Inteco found that in stores without enough salespeople, customers use kiosks for information and go to a better-staffed store to make the purchase. On the other hand, kiosks can free up your salespeople from repetitive questions and collect useful marketing information.

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