Research suggests that businesses in India will continue to invest in software into 2024. So we asked 250 decision-makers how they make critical decisions around these purchases.
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According to our recently published 2024 Capterra Tech Trends survey, companies in India are confident about business in 2024 and see technology investment as a key enabler to help them meet their growth targets.
But investing in the right tools is not just a case of clicking the first online ad that pops up. To find out how businesses approach software procurement and to understand current buyer behaviour trends, we surveyed 250 people involved in the software purchase decision-making process at organisations in India. They were asked about budgets, buying teams, what content they use to support their decisions, and the value of online reviews.
You can scroll down to the bottom of this article for a full methodology.
Sharp rise in software upgrades and modifications in 2023
According to the majority of respondents in our survey (only including those who provided spending figures in Indian rupees), software budgets for 2024 look healthy. Almost all have already set them, and most (71%) stand at over ₹20.6 million.
These budgets will have been informed by the activities of 2023. Over the year to date, businesses reported a sharp rise in the frequency with which they have to make adjustments to their internal software landscape. Over three-quarters (76%) said they have had to replace, modify, or right-size software more frequently since the beginning of 2023.
Buyer behaviour when facing purchase regret
In our 2024 Capterra Tech Trends survey report, 79% of software buyers said they regret some of the tech investments they have made in the past year and a half. As a result, significant proportions have had to liaise with vendors to resolve issues and many have had to replace solutions outright. Read the full article to learn more about why software buyers come to regret their decisions and how you can avoid the same fate.
Software customisation is a common practice. On average, respondents said that 71% of the software they purchased over the last year was customised for their needs.
Usually, buyers seek customisation to improve software functionality. But they also request changes to increase capacity: to handle more projects or to add more users.
When customisation is required, it’s vital that those on software buying teams have a complete grasp of both the products and the vendors on the market. Later, we will explore how teams gather that information.
Who is responsible for software buying in Indian companies?
Software procurement, according to the respondents to our survey, is a team sport. Most purchases appear to involve multiple stakeholders from various business units.
Only one in ten said they were the sole decision-maker for software purchases, while 76% said their company typically has teams of between 2 and 10 people. In 14% of cases, the team is even larger.
As the above graphic illustrates, formal software purchasing teams are the norm, and these are usually made up of either IT professionals or a cross-functional mix. Such decisions are overwhelmingly handled in house, although 7% of respondents said their company engages an external consultant to help.
Financial stakeholders also play a part in these decisions more often than not. 53% said that colleagues from finance were always involved in software purchase decisions, with another 37% saying they have a say most of the time.
Security is a high priority for software buyers
Decision-makers reported several reasons for their company making software purchases in the past 12 months. The most commonly cited triggers were:
- Needed productivity improvements (60%)
- Concerns about security and cyberattacks (56%)
- Targeting new customer segments (55%)
However, respondents also cited many other use cases, from recruitment and retention to competitive pressures.
These needs are reflected in the popularity of software purchases in 2023. Cybersecurity software was the most frequent recent purchase, followed by business intelligence software, and IT management.
Unsurprisingly, the most popular types of software were those that have cross-industry appeal. More niche products like property management and retail management software were lower down the list.
Good security requires more than just software
Good security is fundamental for any business. As well as the right software, businesses should ensure that they have appropriately skilled people in place and processes to protect information and reduce the risk of a cyberattack. The Indian Computer Emergency Response Team (CERT-IN) has guidance, information, and training for businesses on its website.
Businesses have clearly identified the need to buy digital tools next year and have allocated funds accordingly. Let’s explore how they approach the process.
Usability and localised content can swing a decision
When it comes to product attributes that decision-makers look for when searching for new technology, cost was not a major priority in our survey. Security topped the list, being a top-three consideration for more than half of respondents (54%). Features and functionality came second, followed by ease of use.
During the decision-making process, software buyers also consider how interactions with the vendor may affect the purchase and subsequent ownership experience. The most important factors during sales interactions here were:
- Ability to support integration process (55%)
- Willingness to collaborate with us/flexibility (52%)
- Knowledgeability of the sales team (52%)
- Product demonstrations (45%)
- Demonstrated understanding of our situation (39%)
- Existing relationship with sales team (39%)
In addition to liaising with vendors, buyers also turned to a range of supporting content to educate them about their choices. Customer-generated content featured highly here. Software buyers were most likely to have used reviews and case studies to help them make decisions, but they also used information from the vendor about support and personalised product demos, for example.
Software buyers recognise that their purchases should be user-friendly, so they also like software vendors to provide localised support and content. 57% said that it was extremely important that vendors provide product information (i.e. product description, features, pricing, etc.) in their primary language and currency.
Furthermore, 53% said they consider it important that the product’s interface is localised. 46% said the same about support services. And 39% like to see training courses and materials in their primary language.
Reviews from other customers carry huge influence
Perhaps the ultimate form of customer-generated content is reviews. As we saw in the previous section, this was the most common type of content that buyers in our survey said they used during the decision-making process. Most (52%) said that reading these reviews was extremely important before making a purchase, and another 38% said they were very important.
The timeliness of these reviews is also vital. 62% strongly agreed that they were more likely to trust reviews written in the past year.
To some extent, buyers value a numeric scoring system for reviews, which provides an aggregated score for a product. But they actually value users’ qualitative reviews more. These can help to understand the more nuanced points of software ownership and let buyers know whether reviewers were looking to solve similar challenges to them.
Many also place significant value on the awards and badges that can be found on review sites. These features indicate, for example, that a software tool has the highest ease-of-use rating or largest number of positive reviews. 49% said these always influence their purchasing decision, while another 42% say they influence them most of the time.
Businesses in India are ready to invest in software in 2024 and have teams and processes in place to make these important decisions.
They know what product features to look out for, and they also know what vendor attributes will help them make the most of their investments. Support, liaison, and software integration are all acknowledged as important success factors.
To help them make decisions, businesses look to content from other customers: reviews and case studies help them understand the reality of implementing and using solutions for real-world organisations like them.
Capterra’s 2024 Software Buying Behavior Survey was designed to understand the makeup, triggers, budgets, and challenges of software buying teams at global businesses across multiple industries and sizes. We sought to uncover the software types these buyers are adopting, their evaluation methods, and what factors convince them to make a purchase, from vendor reputation and sales team interactions to content materials and user reviews.
The survey was conducted online in August and September 2023 among 2,499 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.