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Online Community Software Costs: 3 Common Types of Licensing

Written by Joshua Paul | on January 18, 2013 at 9:45 AM

Online Community Software CostsAfter discussions about what it will do and how it could potential benefit your organization, the most common question about new business strategies is:

How much does it cost?

The same is true for online community and social crm strategies.

While all enterprise customer community platforms require some level of budget, the costs of working with each social software provider on your short list vary widely in how they are calculated.

It can be confusing to speak with multiple vendors that each have different pricing models without a basic understanding of your options and common ways that online community software providers approach providing you a cost figure. More seriously, it can be detrimental to your social business strategy if one vendor, no matter who it is, convinces you that their pricing model is the one and only option available to your company.

Assuming that your organization is going to partner with an established online community software company, rather than build your own platform from the ground up, the pros and cons of which is a whole separate discussion, it is important to understand all of your options and how they will impact your organization's budget. While some companies mix and match pricing options into a Google-like algorithm, most online community software providers keep it simple.

3 Primary Types of Licenses for Hosted Online Community Software

Per Module Licensing or Core System with Add-Ons

In this option, different features of your online community may require special licensing, such as event management, streaming video, or mobile community apps. If you want to manage your online community membership, you may also need a license for that. Each module has a separate price.

This online community software licensing model can also be structured as core set of features with a series of add-ons to get additional functionality at a separate cost.

Per Member Licensing

This option is often mixed with the per module model above. Your organization is charged based on the number of customers, employees, and partners accessing your online community.

Tip: Make sure you do a conservative analysis if you encounter this model. While $5 per online community member per month seems reasonable, but it can quickly add up if you are managing one thousand users.

All-Inclusive Licensing

All-in-one pricing means that your organization gets all of the customer engagement functionality for a single cost - from social community features and targeted email tools to content management and event management systems.

In addition to coming loaded with a lot of valuable features, your organization can limit the features that you will launch with and then turn on new features over time. These "gifts" to customers will make you look like a hero without needing to incur costs for implementing new modules. All-inclusive online community software licenses often comes with a tied pricing structure based on how many users you'll have using the community.

Online Community Software Costs Takeaway

Maintaining the proper licensing can cost additional money. Paying for an entire year vs. monthly may help save you money in the long run. Since you want to avoid additional costs down the down, you'll want to get the most amount of value in the form of features and flexibility for your budget. If you can't secure all-inclusive pricing, you might also look into getting a bundle price for the features instead of paying for individual module licenses.

Knowing how your online community platform providers' pricing models will impact your budget now and as your social crm strategy expands will help you select the right software for your company and give you leverage in making your case to your peers and senior management.

Download your free guide to buying and implementing a customer portal.

Topics: Online Community Software, Online Community

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