Wednesday, March 31, 2010

Should Software Companies Support Their Users for Free?

Through our contributions in the Technolawyer newsletter, I have noticed an increase of readers involved in the legal software industry.  We offer the following article for them as well as attorneys advising clients on start up businesses who offer tech support.  Our special thanks to Brett Owens.  Mr. Owens is the CEO of Chrometa Software and a frequent guest contributor to this blog.   You can see a sampling of his writing on our side bar under "noted guest authors".  If you are looking for time tracking software,  you may want to check our own review of Chrometa's time tracking software.

(Editor's note:  The Nutmeg Lawyer does not receive any compensation for product suggestions or reviews.  We do this in order to maintain the professional integrity of the blog.  It has nothing to do with the fact that our desparate requests for compensation are repeatedly denied.) 


Guest Post by Chrometa CEO Brett Owens:

Support for software, in general, stinks. Why is that? Is it an immutable law of nature, or something that’s evolved over time?

And more importantly – can software companies provide a good to great level of support, and stay profitable? Or will their ship inevitably be flooded and sunk by a never-ending barrage of phone calls from users?

First, let’s split the software universe up into two categories – SaaS (Software as a Service), and traditional. SaaS companies make their money by charging a monthly or yearly subscription for their product. The advantage to a user is that you can “rent” the use of the product, which means that you can get started for a lower entry price. The disadvantage being the flip side of the same coin – you’re paying month after month, it’s not a “rent to own” type of deal.

It’s a sweet deal for the software vendor, if they can pull off this model, thanks to the continuity. And because of this, support from SaaS vendors is usually quite good, because they do have to work to keep your business, and they’ll factor support costs into the subscription price.

Traditional software is a different animal. Generally the up front cost is a one-time fee. After that, the user is generally regarded more as a liability to the company – we’ve got your money, now you’re on your own!

From the vendor’s perspective, support can easily spiral out of control if left unchecked. While the software business does carry high margins, these can quickly erode if you’re spending a lot of time supporting users, especially if you’re not receiving any more revenue in the process.

But from the customer’s perspective, they paid for the product, so don’t they have a right to get help in making it work?

We wrestled with this question in the process of bringing our product to market. We really wanted Chrometa to work great for everyone…in fact, we were convinced (and still are) that it had to. Because we don’t have a big sales/marketing machine, so we need our users to be our feet on the street, our evangelists.

We don’t have a subscription based product. It’s a one-time, $99 price. So we received a lot of warnings from people that we’d “go broke on support” – especially if we didn’t charge an arm and a leg for it.

It never felt right to me to charge support for a product that’s supposed to work “out of the box”. Nor to anyone on our team. And really, when we launched, our potential problem of “going broke on support” hinged on us actually having product traction – so that’d be a good thing! Let’s get the product out there, and worry about the support economics later.

So we advertised free email support with the purchase of a license. In practice, though, not only did we gladly accept support phone calls, but we’d often call people back after receiving a support email, because it’s usually easier to speak live with someone. That’s always a fun thing to do, because people just about fall out of their chairs when we call! The bar on software support is SO low, that it’s not all that hard to step over :)

A few months after launch, we formalized the phone support, got an 1-800 number, and tossed it up prominently on our website. A funny thing happened then – the number of phone calls we received actually dropped.

Why would this be? I think it’s a combination of factors, which has included a consistent “beefing up” of our online help resources, and the general improvement of our product. But having the phone # there seems to put people at ease – it’s there if they need it.

Overall we’ve observed that people are very good about searching for help on their own, before they contact us. Inbound inquiries usually fall into one of the following categories:

1.Bug reports – this has tailed off for us significantly in the 6+ months since we launched, as we’ve been able to address many bugs, as well as enhancements, in product updates. Bug reports are very valuable to us, we definitely want to know about these. So the easier we can make the process, the better.

2.Questions about how to do something – We actually launched without a product help guide, videos, anything! Not that this was a badge of honor for us – it’s just that when you’re bootstrapping a software product yourself, you need to just to the basics, and get it to market. And ultimately these help resources were not absolute “must haves” before launch – though we sure scrambled to put them together after! Again, inquiries of this nature are always accepted, and helpful to us, as we can see where people are getting stuck, what may be unclear, etc.

3.Feature and enhancement suggestions - The best part of getting a product to market is the user feedback. All of the product enhancements we’ve implemented over the last six months have been based on feedback from our users. If you’re a software vendor, I’d think you’d always want to hear these. Of course it’s not possible to implement everything. But knowing is at least half the battle!

We recently started giving free licenses to students – which in theory, would further complicate our support. How can you support free users without any funding! Thus far, not a problem at all. Every student we hook up with a free license is about as nice as could be. Sure it takes me a few seconds to ping them back with a license code, but then again, I’m not a programmer, so it’s not like I’d be doing something more productive with my time anyway :)

Overall our early results on the “Great Free Support Experiment” have been very promising. Our support time continues to trend gently down as our user base grows. And to be honest, we try to look at support as a marketing function as well. I always found it ironic that vendors who won’t accept inbound calls from users often have a telemarketing arm pounding the phones for new business in the next room!

Personally I spent so much time groveling for phone calls and meetings in our very early days with prospective users – “please, just try my product!” – that I’m hardwired now to gladly speak with anyone who wants to speak with me!

If you’re a fellow startup or early stage software company, my advice would be to absolutely give the best support that you can. Take care of your users now – you can always worry about “scaling” and taking over the world later.

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