The software market holds immense growth potential, with over 60% of businesses planning to ramp up technology investment in 2024 alone, according to a recent Gartner survey.

But prioritizing trust-building is paramount for vendors, as neglecting this could lead to significant business loss.

Price is a top consideration for nearly half (49%) of businesses planning a software purchase, Gartner found. Overly complex pricing structures, hidden fees, and unexpected costs often contribute to software deals falling apart and can also lead to reputational damage and loss of trust for vendors, according to the study.

The research highlights a growing tension in the world of software-as-a-service purchasing, as price-conscious buyers grapple with tricky pricing models that can complicate efforts to keep spending under control.

A growth-at-all-costs mentality has led some SaaS companies to overpromise results and obscure pricing details in the pursuit of potential deals. Only 45% of SaaS vendors display pricing online, while the remaining 55% hide it from potential prospects, according to research from venture capital firm Openview.

But salepeople have a reason for their strategy: Simply showing the price upfront may result in a potential buyer stepping back and saying, “Wait a minute. That’s awfully expensive, and I’m not sure I can justify the cost.” Sales knows the product really isn’t overpriced — the buyer just doesn’t understand the product’s actual value so early on.

It’s no wonder why a recent G2 Software Buyer Behavior report found that 60% of software buyers conduct initial research without involving vendor sales teams, and 68% wait until the final purchasing stage to invite sales reps into the conversation.

The larger issue here is the lack of trust in salespeople and their propensity to take a reactive, not proactive, approach, forcing buyers to seek self-service alternatives like review websites and other user-generated content.

The problem is twofold: While vendors should offer more pricing transparency, buyers must also temper their expectations with respect to the product’s full value. To alleviate tensions between buyers and sellers, both sides can take steps to establish more trust and transparency around software pricing.

A two-way street

Vendors should be upfront about pricing models, tiers and any additional fees, avoiding hiding costs or surprising buyers later, as transparency builds trust. They should offer free trials, demos or freemium versions, enabling buyers to experience the value before they commit, which reduces risk for everyone.

Vendors should also provide detailed proposals outlining exactly what each pricing tier includes, leaving zero room for doubt, assumptions or inaccuracies. Communicating how pricing may evolve as product capabilities expand over time helps set proper expectations and avoid unpleasant surprises. Ultimately, vendors should focus on delivering ongoing value and building partnerships, not just closing deals.

Meanwhile, buyers must clearly communicate business needs and goals to help vendors understand required outcomes. Buyers should also take the time to ask questions about pricing models, contract terms and budget thresholds. Reliable vendors will give pricing guardrails, with early pricing transparency — sharing what’s included versus add-on costs — preventing sticker shock later in the process. For additional confidence, buyers should seek evidence of delivered value from a vendor’s current customers.  

Finally, buyers should focus on achieving return on investment and outcomes, not just negotiating lower prices. Consider starting small, if possible, to prove the value and then expand. Build trust through experience and think win-win.

Buyers and vendors can cultivate transparency and trust by fostering open communication, embracing learning and emphasizing mutual value. The result? Better partnerships and a smoother buying process for all involved.