Top-selling software titles in 2005: TurboTax, Norton AntiVirus, Spy Sweeper Tech Bench

According to The NPD Group, US retail sales of non-games software totaled $2.4 bln in 2005, an increase of less than 1%. Weak sales in the Education, Imaging/Graphics, Operating System and Personal Productivity categories offset the strong sales of the Business and Finance categories, which showed respective increases of 9% and 4% over 2004.

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

Title Publisher ARP
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
Student/Teacher Ed
Microsoft $30
Norton Internet Security 2005 Symantec $26
Norton Internet Security 2005
and Password Manager 2004 Bundle
Symantec $34
Norton Antivirus 2005 Upgr Symantec $66
Taxcut 2004 Deluxe Block Financial $64
TurboTax 2004 Intuit $8
Source: The NPD Group