A Comprehensive Pricing Guide for Project Management Software
As a consumer, it is often difficult to determine the absolute price of a product. However, it is also equally hard for a vendor to make sure they’ve priced their product at the absolute optimum level to ensure they’ve secured a profit, as well as an added value to the customer. The project management software industry is no different. With hundreds of players fighting for the customer base, pricing differentiation and service distinction are important metrics used to identify the superiority of one software over the other.
This pricing guide for project management software is aimed at enlightening the users on the different pricing models prevalent in the project management software industry. A team of experts at GoodFirms conducted an extensive survey gathering opinions on the preference of project management software from several companies around the World. The Guide also contains a primer on five popular project management software and their pricing patterns.
Global Project Software Market Overview
The global project management software market is estimated to grow at 10.17% between 2019 and 2024. The total value of the project management software market is expected to be close to $6.68 by 2026. Recent strides in the development of project management software point to its simplification. The dashboards and reports once considered too complex, have become simpler. Also, with the growing popularity of the concept of a mobile workplace, cloud computing has become a key feature of the project management software.
Ensuring users have access to information 24x7 on the platform has become significant, especially in times like these. The perception of project management software needs to be altered as well. Artificial intelligence and associated forms of analytics have spearheaded a revolution in project management software automation and tracking.
Organizations that used Project management practices, including software implementation, wasted money 28 times less than competitors. Despite the need to contain project expenses and plan efficiently to increase organizational productivity, many managers are still unconvinced by the improvements offered by project management software:
Some more stats the shed light on the influence and need of project management software are listed below:
Global Project Management Software Market Competition
Project management software is one that needs significant refreshment and innovation to stay relevant and competitive for a vendor. Jira by Atlassian and Microsoft Project are the market leaders with 39.1 and 18.99 percent market share, respectively.
With features relatively standardized across platforms, the points of differentiation boil down to additional advantages provided by the softwares. Software that can integrate third-party applications has a significant upper hand, as organizations will look to complement sales, marketing, and even operational analytic streams with the software solution. As vendors look to build on the momentum in tool integration on the software front, factors such as ease of use and mobility or platform independence have to be kept abreast of the latest developments. It will be a point-of-differentiation for several vendors.
Project management software is catering to a wide variety of industries, from IT and software services to large, small and medium scale businesses in manufacturing, and electronics.
Regional insights of Project Management Software Market
North America continues to be the number one market for project management software, followed by Europe. Asia-Pacific is the software’s fastest-growing market. China and India are two of the biggest sub-markets which demand project management software owing to the distributed nature of industries.
Despite skittish economies, the two countries have shown robust growth owing to the strength of vital sectors employing the project management software, such as e-commerce and IT. Avenues for market penetration and growth lie in the Asian Countries' start-up ecosystem, which shows a healthy supply of companies in varied sectors. Due to the advanced feature needs of project management software, only a few of the software giants offer it as free. Companies such as openproject.org offer a free version of the project management software.
In a recent survey conducted by GoodFirms, leading corporates from diverse industries around the World participated in polling with their information on price, popularity, and usage. The survey questionnaire was answered even in light of the prevailing COVID-19 pandemic.
Here is the full list of our Research Partners,
- Project management, CRM, and Accounting software are the most used software solutions.
- More than 75% of participating companies use Project Management software.
- Project management software is one of the major and most frequently deployed software by organizations around the world.
Global Consumption of Project Management Software -
Globally, the adoption and use of project management software is likely to increase at a rapid pace. Some of the factors that influence this are as follows -
- Companies looking to curtail inefficient budget expenditure on projects
- An arising need to lower the project failure rate which stood at 27 percent overall
- The growing importance of project management software in industries
- The rapid increase in data and predictive analytics necessities
- Demand to keep projects within timelines of implementation
- Importance of streamlining tasks and projects within sub-functions such as marketing and sales
- Project management software is inherently a B2B tool, but it is a choice of varied industries.
Recent Economic Impact in the Global Project Management Software Industry
Project Management tools are seeing a massive surge in worldwide adoption rates. With more customers opting for brands that offer a better experience, companies are in pressure to complete projects on time with the utmost quality. Time tracking of projects and tasks will be critical owing to the increase in the number of employees Working From Home (WFH).
To manage the efficient completion of tasks, project management software has become the need of the hour.
GoodFirms survey on Project Management Software
- 40% of users relied on the popular services and brand name of Microsoft Project
- 20% preferred the offerings of openproject.com.
- 13.3% preferred other software
It is to be noted here that JIRA, proofhub, and Basecamp arose as options instead of the tried and tested ones. Others committed to investment in project management software, depending on the scope and scale of their projects and businesses.
How to determine the “Fair Price” you’re willing to pay?
Pricing determinants play a crucial role in the final decision of the customers. Some of the factors that affect decision making are as follows:
Software features - The software must have the requisite features to ensure decision making is straightforward for the user.
Infrastructure Capabilities - The hardware capabilities and software functionalities must be compatible so that the user can achieve their goals when purchasing the software.
Vendor reliability - Vendors must be reliable enough to deliver the software, in the agreed specifications, at the right time, at a price. Support and updates must be continuous too.
Current Needs - The needs of the organization are paramount. Before choosing a project management software, it is necessary to consider the business type, business requirements, and the types of projects that the company will handle. The type of business and the size of the business must be factored in with hypotheses on future growth and industry trends.
Future needs - Based on a business plan, the allocated budget, and market conditions, the organization must choose the type of software it is willing to invest in.
Business type and size - The implementation of project management suites depends on the type, size, and volume of business operations completed by an organization. Small scale businesses prefer the basic version of the software. Medium-scale businesses utilize the power of business or entry-level enterprise versions of the software. Large-scale businesses necessarily use the full suite of the software functionalities offered - in this case, project management functionalities.
A recent survey by GoodFirms, participated in by some of the top corporate entities in multiple industries around the World via social media revealed the following key takeaways -
- 40 percent of all companies use basic packages of software
- 40 percent prefer to use the mid-market or business packages offered
- 20 percent of companies used full enterprise packages offered by the software vendor
What are the costs associated with Project Management Software?
Despite project management software’s ubiquity, some costs need to be considered before deciding the software's implementation. You need to include these costs while finalizing your budget to purchase a particular project management software. Even if a free and Open Source project management system is your choice of software, you need to be prepared to assimilate some of the associated costs.
Feature costs - Certain enterprises could prefer a power-user package that includes various functions. Some organizations, however, will not require a complete suite of tools in the project management software. Costs associated with differently customized software will depend on the extent of features added and customization of the project management software.
Licensing costs - Licenses dictate the terms and tenure of usage of certain software. The agreement is between the vendor and the purchasing party. Licenses require renewal within the stipulated period (e.g., every six months).
Upgrade costs - Often, vendors release software upgrades that need to be done at the customer’s end. Most updates require payment to avail of the additional functionality. The vendor usually dictates these upgrade costs.
Training costs - Training users require specialized programs. Generally, the vendor provides the training support or can arrange a third party specialist well-versed in the software to extend the training support. This training cost isn’t usually included in the original cost estimate and is generally borne by those who require training on the software.
Scalability costs - Generally, project management software vendors stipulate specific costs per user of the software. As the number of users of the bundle increase, the costs increase as well. Scalability is considered a prime factor in widespread organizational software use. Unnecessary bulkhead costs associated with software access can be countered by assigning privileges to users who need to use it the most.
Deployment costs - These costs are associated with the hardware and supporting software demands of implementing project management software. Different project management software systems use different computer system specifications, including RAM, and memory storage, for computing purposes.
Support Costs - As with many software types, users can access a support repository for the project management software, such as forums and videos, free of cost. However, certain vendors choose to charge customers for personalized, human support.
Pricing Analysis for Project Management Software
Freemium pricing - Freemium pricing is a method that involves making a base version of the software available for users to download. Further versions of the software - the ones with high-end features come for a price.
Firms such as Open Project, a free and open source project management software, ensure that individual users can install and operate the software for free. However, this is only a base model. To avail premium features, such as hosting a higher number of users or even premium developer support, the user needs to purchase the “Business and Enterprise” versions at a price.
The pricing in most software is dependent on the number of users who can get access to the software, or the exclusivity of the features.
Subscription-based pricing - In this form of pricing, the client purchases the software from a vendor for a set period, and also includes a standard price for the tenure of usage. Project management software subscribers prefer this pricing model as it gives them enough leeway in choosing their plans and tenure of using the software. They can also decide to increase or decrease their subscription usage depending on the situation.
(i) Monthly Subscription Plan - The Project management software providers target businesses by levying a monthly sum for the software usage. Benefits of this process include companies being sure of the services offered being of the highest caliber, while preserving logic in paying small sums for the software, protecting the overall budget.
(ii) Yearly Subscription Plan - Like a monthly subscription plan, project management system promoters allow businesses to lease or subscribe to the services of the software for one year. Yearly subscription plans can be made to fit into the budget overall if the vendor’s products are well-liked by the purchaser, and paying monthly amounts becomes a hassle.
E.g., Wrike, and ProjectManager.com charge customers per month (often billed yearly), to use different versions of their software. The rate per month, per version, is fixed.
Usage-Based Pricing - In this form of pricing, the project management software organizations charge customer firms on the number of workers or users who use it for a specific period.
E.g., Projectmanager.com follows usage-based pricing for its enterprise and cloud solutions - dependent on the number of analysts and managers who use the software versions.
Flat Rate Pricing - As per the principles of this pricing model, project management software firms charge their customers, irrespective of size or revenue, the same, flat sum for the same services and software features.
E.g., Microsoft Project’s on-premise standard edition is priced at $620 for all users.
- Upfront costs - Total payment for usage of product, Training and Development costs
- Recurring costs - Customer support and service,
Top Five Project Management Software
#1 Open Project
As a popular free and open source project management software, OpenProject helps users effortlessly track the five stages of the project lifecycle - Inception, Planning, Execution, Monitoring and control, and closing. The company claims to have released 135 versions of the software, the latest of which is 10.5.0. The software comes in three different versions - Community, Business, and Enterprise.
- Project Planning and Scheduling
- Product roadmap management
- Task management
- Team collaboration center
- Facilitates application and monitoring of project management principles such as Kanban, Agile, and Scrum
- Cost Management and Budgeting dashboard
- Bug and Quality control management
- Comprehensive project documentation and Wiki creation tools.
- Data Security using Two Factor Authentication and LDAP
- User Management
Open Project - Plan Wise Analysis:
A twelve-year-old organization, ProjectManager.com claims to have over 20,000 key users, spanning 101 countries. The project management software company counts NASA and the United Nations amongst its satisfied customers. The company believes in crafting unique project management solutions for a variety of teams - from construction to IT and development.
Some features of ProjectManager.com are as follows -
- Real-time updating data dashboards
- Task management center
- Timesheet and time tracking control
- Agile Project Management tools
- Task and team collaboration
- Mobile Support
- Third-party tools integration
- Resource Management reports
- Customizable Reports
- Cloud-based infrastructure integration and support
Project Manager- Plan Wise Analysis:
With customers such as Google and Hootsuite, Wrike is a project management software organization that completed over 100 million tasks on its platform in 2017. Launched in 2006, the 14-year-old company offers solutions to improve productivity across all teams.
- Simplified task creation and management
- Project planning and progress tracking
- Easy integration of third-party tools
- Team Collaboration
- Streamlined workflow management
- Customized reports
- Analytics dashboard
- Authentication and role-based access control
- Multi-layer data security
- Fluid and fast User Interface
Wrike - Plan Wise Analysis:
The project management software organization claims to have managed over two million unique projects, as well as billing close to two billion dollars in invoices. Their proprietary project management software is used by companies such as Toyota and Adidas.
Some of its most important features include -
- Project scheduling toolkit- Gantt charts and critical path highlights
- Task Management center - Includes Kanban boards, workflows, and individual budgets
- Resource Management
- User Access Control
- Financial Management tools - includes budget sheet and indicators
- Document storage and management
- Time management - provides time tracking and automated project time reports
- Analytics and dashboards
- Multilingual platform
- Third-party tool integration
- Bill invoicing facilities - recording, automation and reporting
- Mobile integrations
Source - Paymo
Paymo - Plan Wise Analysis:
A prestigious offshoot of the Microsoft stable of renowned software, Microsoft Project is the popular project management software in many companies. Microsoft Project is implemented through a Project and Portfolio Management (PPM) partners program. The partners consult businesses and assist them in the deployment of software best suited to the organization.
The latest version of Microsoft Project came in October 2019, with a host of new features that are as follows -
- Graphical time management techniques
- Team collaboration
- Business intelligence and data analytics
- Customizable and instant reports
- Mobile customizability
- Application integrations
- Planning, scheduling, and tracking
- Innovative task management
- Agile Project Management techniques
- Resource reporting
Source - Microsoft Project
Microsoft Project- Plan Wise Analysis:
*Microsoft Project has On-Premise solutions and not just those executed on a cloud platform. On-Premise solutions range from $620 to $1030.
Top Five Project Management software Price Comparison Chart
The comparison chart is indicative of the price of five project management software versions, basis your organization size, i.e. if you are a small, medium, or large scale enterprise.
Are free base versions of expensive software not to your taste? GoodFirms have compiled a list of the best free and open source project management software.
GoodFirms has also compiled a complete Buyers Guide on Project Management Software with the intention of answering multiple questions and providing perspective. This has been carried out through extensive research and rigorous analysis.
A thorough consideration of all associated fees is necessary, before finalizing a Project Management software for your organization.
Here are some important tactical data insights that are necessary for any consideration
- 28%: The percent of projects fail because of inaccurate financial project estimates is 28 percent
- 28x: Companies that implemented Project Management practices reported 28x lower wastage of monetary resources
- 40%: of all IT projects completed in 2018, went over budget
- 200%: 17% of all IT projects implemented overran budgets by 200 percent
- 27%: On average, companies reported a cost overrun of 27%.
Global Market conditions
When economic activities in global markets surge, the prices of software also surge. In sluggish economies, you may get project management software at lower prices. Global demands significantly influence the pricing of software solutions.
Current and Future Needs of your business
Project management software's pricing is largely determined by its ability to work for your current as well as future needs. When your business scales up you have to deal with multiple projects simultaneously. Your project management needs might change dramatically and you will require more features. Your project management software should be able to alter its existing features and fit according to the changing needs of your enterprise.
The vendor's reliability is an important criterion that determines its price. Whether the vendor has a reliable platform? Are payments secure? Whether the data is safe? You can't expect to profit with an unreliable vendor. Reliable vendors with a great track record of customer service will cost you more.
Adherence to Government Regulations
A vendor that adheres to all policies and standard procedures underlined by regulatory bodies will never get you into legal troubles. But that vendor will be spending a substantial amount to maintain the compliance requirements and therefore will sell you a software at comparatively higher prices than peers.
Sometimes your infrastructure may not be compatible with the deployment of the project management software. If the vendor provides you with additional supporting infrastructure to run its software on your systems then it will surely reflect on the prices.
If you wish to invest in Project Management software, then please feel free to learn about the functionality, pricing options, and screenshots of more than 100 project management software systems on our best project management software listing page.
(This research article was co-published by Jason Adams and James Mordy)
Very well articulated and explicitly presented information. Please keep producing more information like so. Very helpful
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