It’s the time of the year when software retailers carry perhaps their only seasonal application – tax software.
This year again sees a large U.S.-based company — Intuit — facing a small Canadian firm — Dr. Tax Software — in the battle for T-slips with both boxed and online completion versions.
And while applications in general are increasingly sold as a service, neither company sees boxed sales declining in the near future.
“It’s the kind of product that does very well in the channel,” said Gary Mirsky, Intuit Canada’s sales director.
But both companies are satisfied with concentrating sales through big chains.
In fact, there’s a little price war: Dr. Tax chopped the price of its UFile to $19.95 from $29.95 last year. Last month Intuit cut the price of TaxWiz to match.
Intuit has an edge with six English-language offerings: three boxed versions of QuickTax (one for unincorporated businesses, the others for individuals) ranging in price from $60 to $40, and two online versions: QuickTax Web ($19.95) for relatively simple returns and SnapTax ($9.95) for “uncomplicated” returns; plus TaxWiz ($29.95), which it bought three years ago.
There are also French editions.
Dr. Tax has two versions of UFile (called Impôt-Expert in French): one boxed ($19.95) and the other for those who want to do taxes online. It also sells DT Max direct to accountants for corporate clients.
Versions of the boxed editions can also be bought direct from both vendors or downloaded.
Dr. Tax is trying to even the odds by focusing distribution on two major chains, Future Shop and Best Buy.
“The arrangement we have (with them) is a healthy one,” said Joanne Birtch, Dr. Tax’s director of marketing and communications.
Sales doubling
Last year the company sold 60,000 units of software, the majority of it through those two outlets. In January sales had more than doubled over the same period last year, which she credited to a cut in price to $19.95 from $29.95.
Both the online preparation (where Dr. Tax started in 2000) and boxed sales are growing at a 30 per cent rate, she added.
Intuit, which sells largely through mass merchants such as Zellers, Wal-Mart, Real Canadian Superstores and Shoppers Drug Mart, refused to give sales figures. But Mirsky said it does “considerably more” boxed than online sales.
“Boxed product is still the dominant player. There has been an increase in the amount of Web-based and downloaded product, but not to any significant degree.”
The war between the companies is being fought in the traditional ways: Intuit is offering marketing funds to its retailers and has a big national advertising campaign. For the first time Dr. Tax bought television time to push UFile, with Birtch saying it’s giving the upstart “a lot more presence.”
Asked if she wants to expand next year to more retailers, she said it depends on Future Shop and Best Buy.
