Beware skyrocketing costs that can accompany per-seat pricing plans
Owners and managers of contact centers have a unique balancing act to perform. They need to find software that can route and manage calls between their agents, and also often need the ability to accommodate multiple schedules and locations.
In today’s marketplace, there are many providers of contact center management software, each offering a unique combination of features and fees. Those who offer per-seat pricing, in which the monthly rates change based on the number of people who utilize the software, can often advertise appealingly low rates. However, once the contact center using the software increases their agents, those rates can skyrocket.
A look at call management software pricing models
So, what is an owner or manager to do? A successful call center needs to increase their agents if they want to keep their hold times low, but those rising costs can be a real deterrent to growth.
Jason Smith, an account executive here at CallTrackingMetrics, consults with contact center owners on a daily basis regarding their cost issues. We checked in with him today to get his expert opinion on call management software pricing models.
Jason, what’s your take on the pricing models that charge per user?
Well, first off, seat-based pricing has been on the decline in recent years, and we predict it will continue to decline. At a very small scale you might be benefiting from a per-use model, but as you scale upward and spread adoption through your organization it can become very cost prohibitive.
Think about it … the per-seat carriers are in business to make money, too. They know how much the average user costs them, and they set their per seat fee with a margin high enough to profit.
When you discuss pricing with contact center managers, what issues do they often present you with?
There are several problems with the “users instead of usage” billing model, the most obvious being that if nine people touch the system for 5 minutes and one person uses it eight hours a day, seven days a week, you still need 10 seat-licenses, even if nine out of ten users are offline for most of the day.
Another problem is that per-user pricing can disincentivize an organization’s adoption of a solution, which leads to lower retention rates, reduced opportunities for expansion, and can prevent you from capitalizing on all of the benefits that call management software can offer.
For example, when I’m discussing pricing with someone who currently pays per seat, I might hear something like,”Our current software is great for the marketing department, but we can’t add any salespeople because it would cost us an extra fee for every member of the sales team, or $1,500 per month whether they use it or not.”
The last problem is that in order to stay competitive, you’ll see some seat-based vendors start with a very low initial per-seat offer, but then they roll in additional hidden fees and surcharges that you weren’t expecting when you saw that low cost-per-user in your discovery process.
How does this compare with the unlimited user pricing model?
Good question, and one that I’m familiar with since CallTrackingMetrics offers unlimited users for a set monthly rate.
Usually, my main talking points about the unlimited user pricing model are:
- Pay per minute … for only the minutes you use.
- Feel free to scale up and down as your business requires, with no surprise bills.
- Truly only pay for the time that your agents are on the phone.
- No long-term contract is required, so you can stop using the software whenever you want.
I always tell people that we believe in letting businesses start small with our solution, because once a customer sees the amount of data that we can provide, and how we’re able to supercharge their phone management, we’re confident enough in the product to know that they will find value.
From there, they will naturally want to take advantage of the additional capabilities we offer. This land-and-expand business model where new customers can start at an affordable price, and then pay more over time as their needs become more sophisticated or as the product gets more widely adopted in their business, is a growing trend and should really be a welcome change in the SaaS space.