With millions of people using Capterra each year to find and compare software for their business, we were able to collect some interesting data points on how software buyers filtered their software search results in 2011.
Here are some highlights:
- 74% of software buyers were from companies with less than 50 employees. 6% were from companies with 1,000 or more employees.
- 75% of software buyers were from companies with less than $2 million in annual revenue. 3% were from companies with a billion or more in annual revenue.
- Windows remains the most popular platform with a 49% share of filters. Web-based (aka SaaS or Cloud Computing) is #2 with 26%, and Mac is #3 with 11%.
- Mid-large businesses are more likely to be interested in web-based solutions. Companies with one employee choose web-based just 18% of the time. That grows to 26% for 2-9 employees, 29% for 10-49 employees, 31% for 50-99 employees, 35% for 100-999 employees, and 39% for 1,000 or more employees.
- The same thing applies to number of users. If the number of software users is just one, then Windows is the choice 65% of the time, with web-based coming in second at 15%, and Mac third at 13%. When 2-9 users are involved, Windows and Mac interest decline to 56% and 8% respectively, while web-based interest grows to 28%. At 10 or more users, web-based interest grows to 35-40% interest.
- When comparing 2011 to 2010, interest in web-based solutions grew by 2%. Interest in Mac solutions grew by 10%. The main platform that took a hit was not Windows, but instead Linux/Unix, which declined by 16%.
I see three main takeaways in the data…
First, web-based software continues to grow in popularity, particularly in larger and/or growing companies where multiple users need access to the software. This seems intuitive but contradicts the often-held perception that web-based software is “lightweight”. I think there are a few reasons for this growth in popularity. Most new software companies, certainly those that are venture capital backed, are on the cloud. More importantly, web/SaaS/cloud offerings are being marketed heavily and are receiving great attention in the press. Finally, and probably most importantly, the initial buyer concerns about uptime and security are largely going away as these applications have gone mainstream and their peers are reporting few, if any, issues.
The second takeaway is the continued impact that small businesses have on industry in general, and the software market in particular, is enormous. The vast majority of businesses are small, very small in fact, and this is where Windows and Mac continue to thrive. Microsoft and Apple remain the dominant brands among small business owners, who are often the last adopters of newer technologies. It will be interesting to see how long they will be able to maintain their market dominance of this sector.
The final takeaway is that even in the mid to large companies, web-based interest still remains in the minority. With all the press and analyst coverage that cloud offerings have been receiving over the last 5-10 years one would think it would be much greater than 30-40%. I see two main reasons for this. First, change takes time. There are millions of businesses, many of which have complex software needs and installations, and switching over to something new often takes years even once a business has begun considering a switch. Second, many companies have simply become platform agnostic. They don’t really care if the software resides internally or on the Internet. There are pros and cons to each and the platform is just one piece of the puzzle. Overall functionality, user-friendliness, price, integration capabilities and other factors are also very important. Savvy tech buyers rarely want to lock themselves into a platform if it means that it may rule out some of their best options.
The question remains — at what point does web-based software stop taking market share? Most forecasters agree that it will become the majority at some point. Will that be 51%, 67% or 85%? Only time will tell.