While speaking with one of our customers a few years back, he remarked that our software didn’t have any “gotchas”–bad surprises that spring up after the purchase. In dealing with software vendors for many years, he told me that he had come to expect “gotchas” in all software purchases.
In other words, he actually expected that software vendors were trying to trick him. I don’t know about you, but that makes me sad. Should a customer be surprised when software does what it’s supposed to do, and costs what they expect it to cost? Of course not!
Perhaps a better question: How did it get to this point?
I think much of it starts with pricing. Business software licensing models aren’t exactly straightforward. In fact, they’re downright confusing. I’ve been in this industry for over 30 years, and I still run across licensing structures that confuse me.
The problem is, many of the licensing structures are confusing by design. Vendors lure buyers in with cheap price tags, only to sneak in a few “gotchas” when it’s time to buy, or after the purchase.
1. Not including all the features in the base price
Sure, the salesperson told you that their software handled everything you needed. How were you supposed to know some of those features required additional, expensive plugins?
It’s a common practice: Vendors lure you in with a low list price, but charge extra for the features you really need. Just the other day, I saw development software claiming mobile app development capabilities. But, upon closer inspection, I realized that feature was an add-on. This happens all the time.
How can you avoid this? Before you buy, make the vendor list every feature not included in the base price. You might be surprised how quickly the price goes up.
2. Charging extra for integration or additional DB support
Similar to the first point, some vendors charge extra to integrate with common applications or support multiple databases. Sure, the software might advertise integration with your system or support for your database, but…don’t assume it’s free.
For example, I recently saw two different licensing structures that looked quite affordable at first glance. But, then I took a closer look. One only supported MySQL out of the box, and charged an extra fee for multiple database support. The other charged a 5-figure fee for integration with a popular enterprise system.
3. Sneaking in extra fees
Chances are, you’re familiar with standard fees, like per-seat or per-user fees. Be careful…some vendors lure you in with low per-seat fees, only to dump a bunch of sneaky fees on you later.
For example, some development software vendors charge extra fees to distribute applications you build with their software. Others charge fees any time a user accesses an application. I’ve even seen Business Intelligence software that charges extra fees to output your reports to a PDF document.
I call these fees “success fees”. As your company becomes more successful, the software becomes more expensive. As you add new users, or require additional capabilities, the price of your software keeps rising.
4. Outsourcing support
Does anything make you angrier than poor customer support? I can’t stand it. You paid good money for that software…the least they can do is provide good support.
This problem is especially difficult to notice, since you don’t contact support until after a purchase. Unfortunately, some vendors try to save a few bucks with outsourced customer support. What does that say about the vendor? They care more about the bottom line than helping their customers succeed.
Before you buy, understand who supports the software. Is support outsourced? Does their support team consist of product experts, or people in a call center halfway around the world who read from a script? You never realize the true importance of good support until you have a problem.
5. Planned obsolescence
I believe that software should constantly evolve. With a steady stream of enhancements, software can continually remain on the cutting edge. If built right and enhanced regularly, good software will not become obsolete.
However, that’s not the case with every vendor. Some vendors design software for obsolescence. Why? If the software becomes obsolete in a few years, you’re forced to upgrade or buy the next version. It’s a shifty practice, but it happens more than you think.
How can you avoid buying software like this? Ask the vendor how often the software is enhanced. More specifically, ask to see a list of recent enhancements before you buy.
It’s unfortunate, but many companies actually expect dishonesty from software vendors. They’ve been burned so many times, they believe “gotchas” come with the territory. I don’t agree. If you want to avoid surprises with your software purchase, watch out for vendors who employ any of the five tricks listed above.
Of course, if you have anything to add, I’d love to hear it in the comments.