With the new year right around the corner, find out what businesses in India learned in 2023 and how they are planning their software purchases for 2024.
In this article
2023 may not be over yet, but businesses in India will already be thinking about next year. Some will have set strategies, budgets, and goals for 2024, but those who are still planning might need a nudge in the right direction. And knowing how other organisations are behaving in the current landscape can help any company set themselves up for success.
To help inform critical planning, we surveyed 350 people involved in the software decision-making process at organisations in India. We wanted to find out what priorities are for 2024, how they manage the decision-making process when it comes to buying new software, and whether they have experienced any buyer’s regret when it comes to a recent software purchase decision. You can scroll to the bottom of this article for a full methodology.
Software buyers share an optimistic outlook
To put commercial software buying trends in perspective, it helps to have an overview of the business landscape that respondents operate in. Overall, the reported outlook for companies is good, with 38% of respondents expecting significant expansion and increased business opportunities over the next 18 months, and another 53% anticipating steady and moderate growth. Only 2% foresee a decline in fortunes for their company in 2024.
Of course, an organisation’s performance also depends on external factors. Respondents were most likely to cite advances in technology as one of the factors shaping their business goals (40%), just ahead of general economic growth (37%), and the availability of skilled workers (32%). It’s clear that businesses are optimistic about the market landscape and see technology as a key enabler of business success.
That said, nearly one-third (32%) said that identifying the right technologies to adopt is a challenge for them as a business decision-maker for 2024. This was one of the top five challenges cited, along with:
- Training and upskilling employees (33%)
- Engaging customers online in a meaningful way (31%)
- Delivering quality customer service (31%)
- Finding qualified talent (31%)
Buying software is therefore seen as a necessity, but also presents significant challenges. Deploying the right technology can have a transformational effect on a business, but it can also take years to recover from a bad purchase, as we will see later in the article. Buyers have many factors to consider here, including security, finances, adoption and training, and selling the project internally. This graphic shows the principal challenges that organisations in this survey currently face when planning investments in new software.
Software spend is set to rise in 2024
Companies are on the lookout for new software, but many solutions were put in place long before our survey. IT management and IT security topped the list of software types that were deployed at least 12 months earlier, with 35% of companies having each of these. 34% said they had rolled out sales management software more than 12 months ago, and 33% already had accounting and finance tools.
Companies have also started adopting a wide range of software within the past 12 months. Notably popular types deployed in this time period include learning management systems, logistics and supply chain management software, and field service and maintenance management software, all of which were adopted by nearly two-thirds within the last 12 months.
Two categories of software clearly stood out as significant recent purchases. Accounting and finance tools and business intelligence and data analytics software were the latest acquisitions for 17% and 16% of respondents who bought software in the past 12 months.
Looking ahead, a large majority of software buyers in our survey said their organisation plans to increase spending on software in 2024 compared to 2023. 40% said this increase would be in the order of 10–20%, while 44% said they forecast increases above 20%.
Priority areas for software investment include accounting and finance tools (chosen by 41%), followed by business intelligence and data analytics, and call centre and customer service software.
How do businesses in India buy their software?
Good purchasing decisions start with good people and good processes. 82% of the software buyers surveyed say their organisation sets up a formal team to make these decisions. These are often cross-functional teams that include IT professionals.
Purchasing teams do not take their responsibilities lightly. 61% of respondents, for example, reported that their organisation spends between 3 and 6 months evaluating options and determining which products fit their needs.
99% said they typically start with a list of vendors in mind. A large majority (72%) of these usually have between 3 and 6 potential suppliers. Buyers consult a range of sources when drawing up this list, with the most important being customer reviews (used by 45%), online search (35%), product trials (35%), and vendor presentations (32%).
After this initial research, buyer organisations then often choose to engage with a smaller subset of their list, usually around 1 to 4 suppliers. This engagement may mean conversations with the vendors, attending demos, getting pricing, or starting a trial, for example.
The thorough nature of this research phase seems to result in high levels of confidence in purchase decisions —at least when contracts are being signed. Buyers overwhelmingly reported feeling secure in their choices at the time of their most recent purchase, with 9 in 10 saying they were very or completely confident.
Buyer's regret: why software purchases go wrong
Responses here show how seriously businesses take software buying and how diligent the process can be. But regardless of how confident a team is at this stage, the real test is in the implementation. A large majority (79%) of software buyers in our survey said they regret some of the tech investments they have made in the past 18 months.
However, the top reasons that software buyers tend to regret some purchases are around the implementation rather than the product itself.
It stands to reason that most buyers will have familiarised themselves with the product and its features, maybe having trialled it in their business before purchase. But it is much harder to guarantee that the implementation and internal rollout will go smoothly. The large proportions of respondents saying that the software is more expensive than they expected, or doesn’t integrate properly with their existing tools, suggests that better communication from vendors and/or more research from buyers is necessary.
Vendor behaviour, too, has an impact on how buyers feel after a purchase. Of those who regretted a software purchase, 51% said the handoff between sales and implementation was problematic, while 47% thought that the vendor overpromised and underdelivered. This again reflects a gap between how a product is marketed pre-sale and what the provider is able to deliver post-sale.
What do decision-makers do when they experience buyer’s regret?
A poor software purchasing experience can have far-reaching impacts. 57% who expressed regret about a software purchase said that it had a significant impact on the organisation’s annual or long-term performance. This stems from excess costs and from reduced competitiveness, among other factors.
But firms that have regretted a purchase are active in remedying the situation and expect vendors to do the same. In the immediate term, most have attempted to liaise with the vendor or replace the software altogether. The three most common solutions they took —or plan to take— were:
- We asked/will ask the vendor to help remedy our issues (37%)
- We replaced/will replace the technology with another from a different vendor (37%)
- We attempted/will attempt to renegotiate our contract with the vendor (37%)
While they expect the following from vendors:
- Respond immediately to customer requests (58%)
- Assign a dedicated staff member to assist customer (58%)
- Provide enhanced implementation assistance (52%)
Moving forward, regretful buyers say they have made adjustments to the software selection process, especially to identify and mitigate risk. They say that security reviews, supplier risk assessments, greater clarity of goals, and better communication could all help avoid such problems in the future.
According to the software buyers we spoke to, 2024 looks to be a good year for business. They expect steady growth and plan to invest carefully in software to help them solve their key challenges.
Most have developed good experience in choosing and implementing software and know the potential pitfalls. They have robust decision-making processes in place and understand how to enable and judge the success of a deployment. But software implementations can go wrong, and the benefits promised in marketing may not be apparent when a tool is actually installed.
Software buyers should learn from the mistakes highlighted in this research and ensure they have everything in place to ensure a smooth deployment with no hidden surprises.
Capterra’s 2024 Tech Trends Survey was designed to understand the timeline, organisational challenges, adoption & budget, vendor research behaviours, ROI expectations, satisfaction levels for software buyers, and how they relate to buyer’s remorse.
The survey was conducted online in July 2023 among 3,484 respondents from the U.S., U.K., Canada, Australia, France, India, Germany, Brazil, and Japan, with businesses across multiple industries and company sizes (5 or more employees). Respondents were screened to ensure their involvement in software purchasing decisions.
Note: when we refer generally to “software buyers” or “software decision-makers” throughout the article, we are making reference to the respondent sample outlined above.