The Future of Software Pricing
Updated: Oct 22, 2020
How SaaS 2.0 will impact pricing models and sales teams
We live in a society where people believe there is a strong positive correlation between price and value. The higher the price, the more perceived value we expect. When it comes to technology that’s unfortunately not always true.
From a macroeconomic perspective, technology vendors in every industry are seeing downward pressure to reduce prices. This is a result of the recession (decreased budgets), outsourcing (cheaper labor), and commoditization (increased competition).
This was first seen with the rise of cloud-based software that continues to kill traditional software as we speak. But now the SaaS 2.0 movement is disrupting things all over again.
This movement is made up of new web-based software companies that are staying lean, hacking growth, and are design-centric. These companies are disrupting the disrupters. Think Eventbrite to Cvent, SugarCRM to Salesforce, and Zapier to expensive service companies.
These companies are driving costs down even further by having less overhead, more automation, lower barriers to entry, and simpler solutions. Just like consumers have moved from retail to online, businesses are moving from territory reps to inside sales.
As software costs continue to drop and businesses continue to accept online purchasing, sales teams will need to restructure in order to focus more on account management, marketing, and the enterprise.
These are definitely long-tail trends but the pressure on traditional technology vendors and software is very real. Older companies need to adapt and newer companies need to seize the day.