As a business owner I am always looking at wider market trends for any potential opportunities or challenges on the horizon. One key trend I have noticed of late is the considerable increase of new triallists for our Alibre 3D CAD software we have seen in recent months. Obviously I myself am a huge fan of Alibre and take every chance I can to promote its merits when compared to other (more expensive) options on the market. Their ongoing commitment to product development has seen Alibre go from strength to strength, and we’re thrilled to see this recent upturn in popularity. But that got us thinking about what’s behind it. Could it be just a random spike? Or is it more indicative of wider changes in customer attitudes and habits?
Many of our Alibre customers come to us after using other software packages on the market, and one of the main gripes we hear concerns the ‘Software As A Subscription’ (SaaS) model that many competitor software providers have adopted - we share our customers’ negative views on this trend. With the SaaS model, the customer doesn’t own the software, they rent it, and although the monthly or annual premiums may initially seem like better value for money, this psychological pricing strategy means that over the lifetime of the software it ends up costing significantly more. We know some our competitors are charging between £3000-£4000 per year for one SAAS licence. If we take the average usage of a piece of software as 5 years, an Alibre customer who paid full price and decided on maintenance every year would still be more than £15000 better off!
Another often-touted justification for the SaaS model is that customers are always provided updates and maintenance for the software, but what if you don’t need it? For many customers, the software provides everything they need at the time of purchase. Why should they then have to pay for ongoing updates which simply are not applicable or of use to them?
Another way the SaaS model rubs me the wrong way is the potential situation where customers end up paying for software they rarely or no longer use, whether that’s due to accidentally missing automatic subscription renewal deadlines; the onerous and time-consuming process of cancellation; or simply to still have access to historical data. When I first set up Mintronics I bought into a simple SaaS CRM system at £45 per month. Sixteen years later we are still paying £45 per month (£8640) for what is now an outdated and not unfit for purpose CRM just for legacy data access. Relate this experience to CAD where IP and access to old CAD drawings are so important you can certainly see a legacy rental problem for ever!
Alibre remains one of the few CAD suppliers with a perpetual licence buy policy. Whilst we can offer Alibre subscription, it is not something we would readily advertise even though we know SAAS is more profitable than perpetual licence sales.
It is important that we offer great value for money and that should our customers want to buy upgrades and support in future years we want to earn it by providing software upgrades and special support, if we can’t do that then why waste money, with subscription you don’t get the choice.
Maybe it is these situations which is encouraging customer to try Alibre, or maybe it’s just increased recognition of the Alibre brand as offering incredible value for money, great service, and continued products development (the next major release soon including a new PDM system).
The top-level list price for Alibre Design Expert is £2070 although currently on promotion with 20% off. Next year customers can pay £420 for a year of support and upgrades (that’s if they need it). When you compare this to a 'locked in' SaaS plan, I know which one I'd prefer.