Thursday, September 3, 2015

Musings on some oddities of software purchasing habits

By Steve Endow

In addition to developing Dynamics GP integrations and customizations, I sell a few add-on solutions for Dynamics GP, such as my AP Payment & Apply Import, and Envisage Software's Post Master Enterprise.

Over the last 6 years selling software, I've noticed that people seem to behave differently when purchasing software versus consulting services.

Here are a few observations I've made.

1. Patience:  When people are shopping for, evaluating, testing, and purchasing software (versus consulting services), they seem to be more impatient.  If I am unable to respond to an email or inquiry the same day, I've noticed that many people get impatient and send additional messages or web site inquiries.  "I emailed you yesterday but haven't received any response!".  I try my best to respond promptly, usually within an hour, but sometimes I'm sick, out of the office, travelling, or actually buried deep in code and can't respond the same day.  In general, it seems that people who are working with me on consulting projects are much more patient than the software prospects and customers.  I guess this can be attributed to the prevalence of online shopping for just about everything, and Amazon's same-day and next-day shipping have further heightened our expectations for immediate delivery of products.

2. Trial license key versus final license key:  I always provide trial license keys to customers to allow them to fully test the software before they purchase.  Usually this works out fine, and the customer is able to use the software with their trial license key while they process a payment.  They then receive their final license key before the trial expires, and they have uninterrupted use of the software.  But, somewhat related to point #1 above, there are occasionally customers (and sometimes partners) who are surprisingly eager to get the final license key.  Even though they have 20 days left on the trial, they will suddenly ask to pay for the software ASAP and get the final key ASAP.  I don't mind processing the payment quickly, but these requests puzzle me.  I can only assume that there is some psychological component about a trial vs. final license key that causes this?

3. Credit cards:  Since I started Precipio Services 8 years ago, I haven't had a single customer ask to pay me for my consulting services with a credit card.  Zero.  And I've only had one partner pay me via ACH.  But when it comes to software, a majority of the purchases are paid by credit card.  I have some customers that have purchased both services and software from me--they pay for my services with a check in the mail, but they want to purchase the software with a credit card.  It seems there is a different psychology about how people pay for things vs. services, or perhaps how people purchase software.

I just pulled some payment history, and see that almost 30% pay by check, 7% by ACH, and the rest with a credit card.  Breaking things down a bit further, of customers who purchased the software directly, only about 7% paid with a credit card.  Partners were the exact opposite--only 7% paid with a check--the rest used a credit card.  So that's interesting--GP partners are the primary drivers of the credit card purchases.  But based on my experience, they never pay for consulting services with a credit card.

As a result of these behaviors or trends, I've had to adapt my processes and systems.  I now respond to all of the software related inquiries to get them out of the way first, and then I have to use the remaining time to get my consulting work done.  This is often a challenge and makes it harder to plan my consulting work since the software inquiries and support requests can vary so dramatically from day to day.

I started accepting credit cards in 2010 to accommodate all of the requests, and this year I finally added a payment page to my web site so that customers can pay online without having to fill out a form or call me to process the transaction.  Accepting payments on my web site has been a big hit--customers can submit the payment in under a minute and receive their final license key shortly after. While by no means revolutionary, it seems to be somewhat progressive for the Dynamics GP marketplace.

Anyway, just some observations that I thought were interesting.

Steve Endow is a Microsoft MVP for Dynamics GP and a Dynamics GP Certified IT Professional in Los Angeles.  He is the owner of Precipio Services, which provides Dynamics GP integrations, customizations, and automation solutions.

You can also find him on Google+ and Twitter


go away said...

I am guilty of point 2 but with a valid reason as far as I am concerned.

1. I paid you so I want it now haha.
2. I would worry that you will forget to send it to me within the trial period, sad but what can I say.
3. Just want to set they key and forget it.


Steve Endow said...

Thanks for the note. Yes, I think #3 seems like a common theme. The customers just want to complete the purchase so that they can get the final key and not have to think about it anymore. I've also noticed that some customers want the final keys before they turn on the software in production. Trial keys are fine for the test environment, but for prod, they want final keys.