In the Business category, the low-priced Microsoft Office Student and Teacher Edition was the best-selling title. The continued strength of this title in the US retail channel shows that the price elasticity of demand for Microsoft Office was much more elastic than many had previously estimated. With regard to Finance, in 2005, Personal Finance titles such as Intuit's Quicken and Microsoft Money were the best performing group, with dollars up seven% over 2004. The four non-games categories that experienced negative dollar growth include Education, Imaging/Graphics, Operating System and Personal Productivity, with respective declines of 17%, 1%, 11% and 14%.
The big surprise in 2005 was the abrupt slow down in the System Utilities category. Although units in the category were up 13% over 2004, increased competition led to lower prices, which led to a dollar total for the category that was flat in 2005. This is in stark contrast to past performance. Over the previous five years, dollars grew 27% compounded annually (2000-2004). Moreover, in 2004, sales of system utility titles increased 48% over 2003, as consumers reacted to the rapid increase in viruses, spyware and other malware threatening their PCs. Education, the category with the lowest sales performance over the last five years, was again the worst performing category in 2005, with dollars shrinking 17% over 2004. This is somewhat of an improvement, however, as the category has averaged a decline of 26% over the preceding five years.
Top 10 PC Software Titles in 2005
|TurboTax 2004 Deluxe||Intuit||$40|
|Norton Antivirus 2005||Symantec||$13|
|Spy Sweeper Tech Bench||Webroot||$65|
|TurboTax 2004 Multi State 45||Intuit||$40|
|MS Office 2003 |
|Norton Internet Security 2005||Symantec||$26|
|Norton Internet Security 2005 |
and Password Manager 2004 Bundle
|Norton Antivirus 2005 Upgr||Symantec||$66|
|Taxcut 2004 Deluxe||Block Financial||$64|
|Source: The NPD Group|