How pricing of business intelligence and analytics SaaS applications can catch up with their technology

The purpose of this paper is to investigate the development of software pricing, following the advent of cloud-based business intelligence & analytics (BI & A) Software. A value-based conceptual software model is developed to ignite and structure further research.

A two-step research approach is applied. In step one, the available literature is screened and evaluated, and this is followed by ten semi-structured expert interviews. With that input, a conceptual software pricing model is designed. In step two, this model is validated and refined through discussions with representatives of the five leading business intelligence suites.

The paper sheds light on the value perception of customers and suggests a clear focus on the interaction between customers and vendors, and less on technical issues. The developed customer-centric, value-based pricing framework helps to improve pricing techniques and strategies.

The research is focused on the pricing strategy of software houses and excludes differentiations of technical specifications and functionalities.

The research can support practitioners in the field of BI & A in rethinking their pricing methods. Placing the customer at center stage can lead to lower customer churn rates, higher customer satisfaction and more pricing flexibility.

This empirical study reveals the importance of a customer-centric pricing approach in the specific case of BI & A. It can also be applied to other fast-developing sectors of the software industry.