Save or Share this Report

For Sourcing & Vendor Management Professionals

The Five Qualities Of Good Software Pricing

An Evaluation Framework To Test How Potential Buyers Will React To Your Software Licensing Model

July 23, 2008

Primary author headshot


Why Read This Report

Poorly designed software pricing can limit sales opportunities, extend sales cycles, restrict upselling, and reduce maintenance renewals. Forrester has identified five qualities of good software pricing from talking with hundreds of software sourcing managers and several leading software pricing VPs. Many software licensing models encounter buyer resistance because they are based on inside-out thinking, stick stubbornly to obsolete metrics, or overemphasize the immediate list price calculation aspect, instead of focusing on defining the license's scope. Product managers can make the sales process easier and preserve upsell potential by designing and publishing a pricing and licensing model that is value-based, simple, fair, and future-proof. Forrester has developed an evaluation framework that will help clients assess the detailed criteria behind these five dimensions to rate their pricing models. This framework will help product managers balance the dimensions' often conflicting demands and create product pricing that potential buyers will embrace.

Get Access

Already a Client?

Log in to read this document.

Become a Forrester Client

Customers are the new market-makers, reshaping industries and changing how businesses compete and win. Success depends on how well and how fast you respond. Forrester Research gives you insights and frameworks aligned to your role to shorten the time between a great idea and a great outcome, helping your teams win in the age of the customer. Contact us to learn more.

Purchase Report

This report is available for individual purchase ($499 USD).


Table of Contents

  • Software Buyers Continually Complain About Pricing Models
  • Good Software Pricing Displays Five Qualities
  • Use Forrester's Evaluation Framework To Prioritize Improvements

  • Check That Your Pricing Demonstrates Forrester's Five Key Qualities

  • Innovative Yet Sound Pricing Will Hasten The Demise Of Obsolete Metrics
  • Supplemental Material
  • Related Research Documents

Recommended Research