Apples iWork Gains Desktop Territory

According to at least one researcher, Apple's iWork desktop productivity suite is bucking perceptions and selling well among U.S. retailers.

Rumors that Apple Computers iWork desktop productivity software isnt selling well appear to be false, based on new research from NPD Group indicating that the package finished second only to Microsofts Office at U.S. retail stores during 2005.

While Corels WordPerfect software ranks second overall in the United States across all sales channels, NPD Analyst Chris Swenson said iWork leapfrogged its rival at retail outlets, where many consumers buy their home computing applications.

Microsoft isnt likely to be concerned over its position in the market, as Office accounted for a whopping 95 percent of U.S. retail sales last year, but Apple upped its share to 2.7 percent of the sector ahead of Corels 1.6 percent of the market.

One of the most important factors to consider in analyzing those returns, Swenson said, is that iWork runs only on Apples own PCs, which account for just a small percentage of the U.S. desktop and laptop markets.

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Among all Mac productivity software, NPD said, iWork represented 17.4 percent of unit sales for 2005, compared to Offices dominant 82 percent.

"The rumor was that iWork was a dog in the marketplace, but it turns out that wasnt the case and that it is outselling Corel in the retail channel, which a lot of people would not have predicted in a million years," Swenson said. "Thats not to say that Corel isnt second to Microsoft if you consider all channels, but clearly Apple is having success with its targeted distribution strategy."

Unlike products from Microsoft and Corel, the analyst said, iWork is available at only a handful of retailers and Apples own stores, which also makes its sales performance an impressive one.

However, Swenson said he also expects sales of iWork to tail off once Microsoft releases its next version of Office and the software is ported over to Apples Mac platform.

"The real story here is the power of using a targeted retail approach, versus a blanket strategy, as Apple is already behind the eight-ball with fewer customers and retailers," Swenson said. "Its all about the concentration of availability for Apple right now."

NPD estimates that its research data, which comes from point-of-sale figures collected at retailers that include and Apples store locations, accounts for approximately 84 percent of all U.S. retail software sales.

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While Corel remains solidly in second place for all channels for U.S. desktop productivity software sales, with roughly 6 percent of the market, Swenson said the company saw its unit revenues fall by .7 percent per unit in 2005. He said the company should take some cues from Apple and do a better job of marketing its products both in stores and online.

"At the end of the day, if youre going to measure Corels performance, retail is only one benchmark, but according to our data retail stores represent a big opportunity among U.S. consumers," Swenson said. "Corel is second overall but needs to focus more effort on its retail channel with in-store promotions and more aggressive marketing."

Next Page: Corel argues that NPDs figures are misleading.