A recent article in VentureBeat highlighted an incredibly important challenge Enterprise Business Software companies are facing. It is simply, how do we attract customers? The traditional model demands that these new products develop their revenue stream. They need to show a return on investment, and to do that, and the obvious choice is to charge for it. Unfortunately, this is exactly what customers don’t want to hear. They want to see a solution that involves budget conscious software, maintains affordability and retains benefits.
As we explained in a previous post, affordability is a key consideration for the new age of Enterprise Collaboration Software. In that article, Kevin Spain pointed out that the power of these new software innovations, “is in making them as pervasive as you possibly can.” Pervasiveness in this sense means that it has to be affordable for the entire organization. At the enterprise level, with a large user base, it just isn’t affordable (or realistic) to think of adding on an additional $20-25/user/mo for access to a line of business software tools, regardless of the potential benefits. This kind of price point will create obstacles and challenges for any CIO.
What about the other end of the market, the small and midsized business? As a recent CMSWire post points out, this market wants Enterprise Business Software in their small business software. They are not happy with the status quo set of disconnected tools (email, calendar, doc sharing, telephone etc.). However, the typical Enterprise Business Software vendors either charge too much or don’t give small and midsized businesses any attention, forcing them to make a significant investment or just deal with what they have. Unfortunately, many decide just to deal with it.
The current solutions will never be long-lasting. Instead, innovators need to offer their services at a fraction of the cost. Lower costs will drive higher demand, which will, in turn, lead to regular and consistent success. Of course, cost is not everything, but it is a huge factor that needs real re-consideration by Enterprise Business Software vendors. At MangoApps, we have worked incredibly hard to keep our costs low and to provide budget conscious software to our customers. We want to help them realize the benefits of Enterprise Business Software tools across the entire enterprise, and to be able to deploy our innovations quickly and easily, without having to worry about securing additional budget.
If Enterprise Business Software vendors are genuinely concerned about how their solutions will improve productivity, they need to make a much greater effort to offer budget conscious software. Are they adding value release after release and keeping the costs to customers low or are they just padding their bottom line? As the price of the solution falls, do these get passed on to the customer? We believe it is indeed possible to introduce a steady stream of innovations without raising price points. The actual benefits of enterprise social software will only be realized if everyone can participate.