As Electronic Filing Software Evolves, KwikTag Delivers Value
Posted by Marya Ulis on Fri, Jul 01, 2011 @ 10:42 AM
Electronic filing software has been around for many years, especially when measured against the speed of technology advancements and new software innovations. But it is still evolving and growing into greater and greater value and benefits for the companies who use it. The benefits of electronic filing software, now evolved into Transactional Content Management (see our related blogs), are well-known, but to review, they include: increased efficiency, improved access to information, simplified audit and compliance, reduced costs through the elimination of your paper burden, and high return on investment.
Return on investment is always made up of the more immediate return on the cost of the solution implemented (that is, how quickly the cost to purchase is recouped through hard and soft dollar savings), and the long term Total Cost of Ownership (TCO), but most companies focus on the short term ROI. Turning our attention to the long term value of a solution, one must consider all the costs of keeping a system running including IT support, software maintenance fees, and other costs to upgrade. To deliver maximum value, a solution must be both cost effective to run, and deliver increased value as it evolves - in the form of the provider adding and enhancing features and functionality.
One common measure of whether a software solution is delivering this value to its customers is its support and maintenance renewal rate. Of course, all companies focus their efforts on growing their customer base, but the cost of that prospect is much higher than that of maintaining and adding value to the current customers. There are many mathematical models that prove the health of a company is very dependent on the customer renewal rate, both in a perpetually licensed or software as a service (Saas) model.
So what renewal rate is considered "good" for a software provider? What is the rate that indicates happy customers who receive continued value from the product?
One internet discussion board pegs a good license renewal rate at 60% (http://discuss.joelonsoftware.com/default.asp?biz.5.832781.17). The Software Success Pricing & Licensing Survey results show 79% of customers on either a standard or premium support plan (which presumably includes software maintenance upgrades, http://www.softwareceo.com/forum/thread/1253/Renewal-Rates/). And SaaS companies, who are heavily dependent on software renewals as that IS their primary revenue model, are achieving 95% renewal rates (http://seekingalpha.com/article/202551-gartner-saas-will-achieve-95-renewal-rates). This high number makes sense - when a SaaS customer does not renew, they must stop using the software whereas a perpetually licensed customer can continue to use the software - albeit unsupported - as long as they wish. One would naturally expect to see much higher rates of renewal for SaaS as there is no viable alternative.
What is KwikTag's renewal rate?
We are proud to say it is a whopping 96.4%! These aren't customers renewing because we will "turn them off" if they don't - these are customers receiving continual value, a return on their initial and renewal investment from very low TCO, and upgrades and new features that increase their value over time.
And, just wait until they see our next release....