Products where price is secondary for customers exhibit pricing power and high retention
In the context of business management software (such as
$INTU's QBs), there's too much hassle to go through to justify a change due to price unless competing software is much much better
Pricing power and high retention is further strengthened if a product makes up a small part of a customer's overall costs.
There will be other places where customers will look to cut costs:
It all boils down to how mission-critical a product is and how much it costs to the customer as a proportion of total costs
This is what, for example, Constellation Software
$CNSWF goes after when investing in VMS software.
Can you think of any other examples? Let me know in the comments!
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