team meeting for early phase software

Bye Bye Beta: A Better Way to Think About Early-Phase Software

Recently, I wrote an article about avoiding “pricing traps” during the beta phase, a common challenge for software companies. My chief objective for the article was to help companies move as quickly as possible from “free beta” to revenue-generating customers.

Now, toward that same objective, I propose a novel idea to you.

Don’t use the term “beta”.

Let’s look at the dynamics of a typical beta software situation. Among the most important objectives, from the software company’s perspective, is to gain referenceable customers for use in the roll-out stage. For this to work out, the customer must have a positive experience, with its users and leaders satisfied with the software’s value. After all, you need them to say nice things about you to prospective customers down the road.

Fighting the Beta Stigma

This is where the term “beta” works against you. To the customer, it immediately implies the software is still in a state of development, likely with bugs, and opens the possibility it may never become a permanent solution for them. This introduces several problems:

  • If the software is perceived as flawed and temporary, user adoption and compliance can be low, thus handicapping the software’s impact and curbing the customer’s referenceability.
  • The client may believe the time required to be your “guinea pig” and the value of their input to your market-ready version is enough to demand the software be given to them for free.
  • With no financial commitment, it is a challenge to gain the level of executive buy-in needed to drive user compliance or adapt current processes.

These are in addition to other challenges common to beta software initiatives, like the run-up in costs and time that come from unlimited change requests—to which the client may feel entitled because they are part of the testing program—and the difficulty most software companies face converting beta customers to full-paying customers.

The reality is “beta” carries decades worth of baggage that gets in the way of its ultimate purpose, which ought to be to prove that customers are willing to pay for your solution while generating early revenue.  

So, what if we could shed that baggage and re-orient the customer’s—and your own—mindset? 

The Power “Early Access” Has Over “Beta”

Discontinuing the use of “beta” is the first step to reposition your customers’ perception about your early phase software away from what’s wrong or missing from it and toward what’s compelling and valuable about it. For several reasons, we’ve been advising our clients to use the term Early Access instead.

Three Reasons to Choose “Early Access”

  1. It implies a real product, with real value, and a degree of exclusivity for eager adopters.
  2. It suggests a premium, such as the opportunity to have input into future product direction or accelerate feature development (and sets the stage to charge for that!).
  3. Most importantly, it conveys an expectation of payment, perhaps discounted as one of the premium benefits, but with the flexibility to reset prices later.

With those advantages, repositioning from “beta” to “early access” can help generate early revenue, facilitate customer buy-in and compliance, accelerate time to roll-out and increase the likelihood of gaining a referenceable customer.

 Saying Goodbye to Beta is a Winning Strategy

Sure, there is more to repositioning than just semantics. Changing from “beta” to “early access” must be linked with a shift in the software company’s internal perception of its solutions and wholly integrated into the marketing and sales conversations the company has with its customers. With those pieces in place, saying goodbye to beta is a winning strategy.

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About The Author

Chris Mele

Chris is Managing Partner for Software Pricing Partners and former CEO of an award-winning SaaS company. Chris graduated from Miami of Ohio with a degree in Computer Science.

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