Facing the Sticker Shock of Enterprise Pricing
There can be a sticker shock when a customer starts seeing how much the licensing for Sitecore is going to cost. One of the things that Sitecore often gets pressured on by analysts is a lack of transparency in their pricing. There isn’t a nice monthly charge option like some of the B2B SaaS vendors out there, Sitecore uses an Enterprise custom pricing model and determining what tier and packaging is right for you definitely needs some guidance from the vendor to find a right fit. This approach often raises questions about cost justification.
Some of the shock comes from comparing against “non-Enterprise” monthly pricings that are posted from some vendors in the space. If you get it into your head that this is the price range for you, an Enterprise licensing deal comes as a curveball. I’ve had it myself when evaluating software for my own teams in the past! It’s very important to understand the real value of what you’re getting when you start evaluating options.
Should I Look at Feature Comparisons?
Yes, you should look at features! It’s likely not the first thing you should worry about. If you focus only on the software features being delivered, you’ll be missing a big reason for the higher price that some vendors will quote you. When you start going through the marketing content for all the different vendors in the space, they all start to sound the same from a capabilities perspective:
- Headless
- SaaS
- Omni/Multi- channel
- AI-driven
- Optimization
- Digital Experiences
- Scalable
- Trusted by leading brands (usually followed by a splash of logos)
The screenshots might be a little different, and some of the features might have different names, but every vendor is trying to check off all the same checkboxes on their website so that they aren’t excluded from your evaluation. All the boxes look very much the same, so I’m not surprised that feature comparisons aren’t as helpful as they could be. This also adds to the confusion around pricing when the quotes are so different between seemingly similar vendors!
The True Value Propositions of Enterprise Solutions
The real differences come out beyond the feature list. When you are buying enterprise software, I believe the things you really need to be looking at are:
- Trust and Compliance. The solution and vendor need to meet the regulatory needs of your organization and understand how to work with you on those. These might include HIPAA, SOC2, PCI, ISO 27001, GDPR, or others.
- Proven Scalability to Match Your Industry and Business Size. There are some truly amazing solutions out there that have not proven themselves at your scale yet. You need to know the solution will be reliable when you push it to the edge with your business requirements.
- Proven Reliability of Operation and SLAs. Your business suffers when systems go offline and you need to know that your vendor is reliable and ensuring availability and monitoring for outages.
- Evidence of Ongoing Innovation and Evolution. In order to maximize your return on investment, you need to be getting a solution that will give you more than what you are paying for today. You don’t want to be stuck with a dead product you’ll need to replace next year or the year after.
- A Support Structure That Can Meet Your Size of Business. If you are a global enterprise, you don’t want to wait for overnight responses from the other side of the world, or go back and forth with somebody on a message board over the course of a week.
- Total Cost of Ownership That Allows You to Focus. As an enterprise organization, your business has to focus on its core competencies and meet restricted budget needs. This includes the licensing cost for software but also operational aspects, which is why so many move to the cloud these days.
Don’t Forget Community!
Because of my personal history of driving community initiatives, I also tend to suggest looking at the community around a product. A strong community presence is usually an indicator of strong relationships with the vendor. Community channels will also provide you with a place to go and talk to other customers and implementation experts who know more details beyond the marketing information sent to you by the vendor themselves.
So is Sitecore Worth the Investment?
Sitecore pricing is not for everyone, that’s for sure. If your team is looking at a Wix or a Wordpress type of solution and are confident it can do enough for what you need out of your website right now, Sitecore products might be more than you need right now.
However, vendors like Sitecore can offer a lot of value as your organization starts outgrowing those solutions and starts needing to deal with more compliance regulations, scale, and procurement needs. You may first be looking at Gartner quadrants and Forrester waves and IDC reports, trying to get a gauge on who the leaders are for your type of organization and needs.
There are only a handful of vendors that I think truly understand the scale of the Enterprise like Sitecore (Adobe and Optimizely, to name a couple) and in that handful they all have very similar offerings and customer case studies. When you want to work with a vendor of this scale and experience, the price does tend to be higher than a startup vendor you might have looked into previously.
In the end, it’s important to look past the number on the quote and start thinking about the full value you are getting. How many people would it take to deliver that scale yourself from another solution? What additional investments would you have to make to piece together technology to get the same level of value? How much risk is your organization willing to take on?
When you switch off the pricing discussion and start talking about value, I think Sitecore does deliver on its promise here and does have enough in the package to make it worth what you are paying for. That is, assuming you make sure to use what you paid for!
But that, folks, is a topic for another day!
