EVERYONE IS NOT YOUR TARGET CUSTOMER
We have great product/service! Why don’t they see the proposition in the way I do? Why aren’t they jumping up and down in pure happiness, demanding that I take their money?”
The fact is that there are any number of reasons why your customer doesn’t think your product is all that.
CERTAIN CONSUMERS JUST WON’T PURCHASE FROM YOU
There is, of course, the possibility that your target customer actually hasn’t been made aware of all the great things your product can offer for them. How the features save them time/money/effort/whatever. How it’s been aimed to resolve the particular problem that they’re looking to solve.
But that isn’t the only reason why customers don’t buy from you. Far from it.
Maybe the product/service doesn’t act the way that they required or expected it to work. Maybe they don’t have the budget, but would rather give another excuse. Maybe they want it in red, but you only offer it in green.
Or maybe, just maybe, they simply don’t like it.
CUSTOMERS DON’T ALL THINK THE WAY YOU DO
The product looks great, apparently does what it says it will do, and is inexpensive to buy – at least at first. It’s being sold in a currently very fashionable way. Rather than buy the software outright, you’re supposed to pay for the product every year. It’s the same sales model used by products like Microsoft Office365, Adobe Creative Cloud, and others.
The difference is that – maybe- the software product does something very small. It’s something that most people consider as a detail in their overall business, in a category that’s disappearing in attractiveness, and certainly something that you can live without. It competes with products that offer the same functionality without you deserving any ongoing annual costs. You can even get similar products for free.
‘PRICE’ IS NOT THE SAME AS ‘VALUE’
Of course there are costs involved in developing and (especially) supporting any product. For software, the general practice is to charge for support at a percentage of the product’s retail cost per year. That figure might be 15%. It could be 25%. It could be more. But it’s certainly not 100%.
It’s also true that other companies approve this business model, especially in the B2B space. But users see products like Salesforce, Marketo or WorkDay as real components of their business, without which they couldn’t function as well as they do today.
At the end of the day the real issue here is one of price/value positioning.