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There clearly are vendors out there simply riding their software into
the sunset. They are collecting annual maintenance (of which they do
little) but hey, it's revenue for them. They aren't truly looking for
new customers but if one finds them, they'll take the money (if it's
enough money!)
There are also vendors actively supporting their customers and adding
function and looking for new customers. We know many of these and some
are active on this list.
Now consider the type of software because that makes pricing completely
different. I'll pick on Brad because his software is one that has no
real notion of 'users' so a user based license makes no sense there. For
example mailtool is not connected to a 'user' it's on the 'system'. So a
per box price is an option, a per LPAR price is an option, a
subscription is an option (by box or LPAR) or even a volume price,
number of emails sent for example.
But look at an ERP or DRP package and there you have a much clearer
option of by user. Have a small shop with 10 users pay lots less than
the guy with 1000. Think about the small shop looking at a new package.
If that guy sees a $100,000 step in price and has 10 users he's gonna
look elsewhere. But see a per user price and he is going to be much
more interested then. As a software vendor in that space you have GOT to
consider that little guy so that when he grows you'll be his vendor!
Consider that Amway started as three guys in a garage and now is close
to 20,000 employees. Sure you want to sell to that 20,000 employee
customer but he's likely all set it's the 3 guys that will be looking
for something when they get to 5 or 10 or 15, does your pricing model
allow for that?
Still others such as EDI have opportunities for still different pricing.
Consider a price per trading partner, per translation configured, and by
volume. Now you can get that little guy as he pays little but as he
grows your bill to him grows as well. Want to offer a 'site level'
license or 'server level' sure go ahead but don't make $40,000 plus 20%
AMC for every freeking LPAR like TLI. They will never get a small new
customer ever at those prices.
And yes while options are nice, make them logical, and public. Sell your
product don't hide behind smoke and mirrors and huge discounts because
of inflated list prices.
- Larry "DrFranken" Bolhuis
www.Frankeni.com
www.iDevCloud.com - Personal Development IBM i timeshare service.
www.iInTheCloud.com - Commercial IBM i Cloud Hosting.
On 8/23/2017 9:58 AM, Rob Berendt wrote:
My boss always says to ask for a 3 year cost of ownership quote. This
helps to cover those cases where the maintenance starts out prorated or
some such thing.
Some packages are moving to straight subscription pricing. Of course what
that subscription is may still be super secret.
Rob Berendt
midrange.com
