IT Budgets & Strategy

IT Buyer’s Journey Q3, 2021

In this quarterly One-Minute Insight Report, Pulse surveyed over 300 tech decision-makers to understand in Q3:

Amid continued economic uncertainty and an ever evolving selection of vendors and products to choose between, how did decision-makers navigate the buyer’s journey for IT in Q3?

Data collection: Q3, 2021

Respondents: 381 technology decision-makers

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Leaders continue to spend 1-3 hours evaluating vendors each week—with peer recommendation continuing to be the main source of discovery

Leaders spent mostly 1-3 hours (62%, up from 55% in Q2) evaluating vendors each week during Q3.

For discovering new vendors, IT leaders continue to turn to peer recommendations (73%, down from 75% in Q2), technology news sites/newsletters/podcasts (66%, up from 65% in Q2), and online IT communities (55%, down from 56% in Q2).

“It’s important to do research and check with those who have implemented and used the vendor and solution as well as negotiate pricing.”
- C-suite, large software company

Features and pricing continue to be most important when choosing a vendor, with annual subscription remaining the preferred pricing model—though usage-based contracts seem to be growing in popularity

When selecting a vendor, the top considerations continue to be features (68%, up from 67% in Q2), pricing and packaging (54%, down from 61% in Q2), and vendor reputation (51%, unchanged from Q2).

As for decision-makers’ preferred SaaS pricing model, annual subscription (42%, unchanged from Q2) continues to lead the way. However, usage-based (23%, up from 20% in Q2) is now the clear second choice, having tied for second place in Q2 with monthly subscription-based (19%, down from 20% in Q2).

“RFP process is critical. Vendor demos are helpful in highlighting features, but to truly compare results of vendors, a proof of concept for a specific test use case must be done.”
- Director, large professional services company

“It’s so hard to choose between vendors and when we make decisions it’s almost always backed by some strong research and pre-development. Next, we compare pricing and security policies, and then the vendor’s reputation.”
- C-suite, small software company

Decision-makers continue to buy new products from existing partners rather than new ones—mostly because they worry new vendors only want the sale

For their last purchase, leaders continued to prefer vendors they are already working with (66%, up from 64% in Q2), rather than purchasing from new vendors (34%, down from 36% in Q2).

The majority of decision-makers are primarily concerned that new vendors care more about acquiring them as customers than keeping them happy (63%, down from 64% in Q2) and that deliverables won’t meet their expectations (60%, down from 62% in Q2). Concerns over not having their specific needs met (29%) are reduced from Q2 (43%).

“Vendor response time to completing our security/IT requirements questionnaire often reflects how responsive they will be if we eventually become a customer.”
- Director, large healthcare company

The number of decision-makers willing to consider startups for technology solutions continues to rise, though established vendors are still preferred by most

More decision-makers are willing to consider startups for new tech solutions in Q3 (83%, up from 76% in Q2).

Decision-makers are still likely to engage both startups and established vendors equally for new technology solutions (43%, unchanged from Q2).

However, when leaders lean one way, it’s still much more towards established vendors (49%, down from 53% in Q2) than towards startups (7%, up from 4% in Q2).

“Financial viability is crucial, especially for startups.”
- Director, large finance company

The quarterly spend cycle of >$100K investments holds firm, with oversight from Finance

Most decision-makers make IT purchases of more than $100K quarterly (35%, up from 29% in Q2).

Finance continues to be the most represented stakeholder (83%, up from 80% in Q2) for IT purchases over $100K.

“[Choosing between vendors] is a balance of many factors. It also depends on how big the spend is. The bigger the cost and investment the more oversight and due diligence will be required.”
- Director, small-medium business

CIOs continue to make the final call on a purchase—after security has given the all clear

The CIO remains primarily responsible for making the final purchasing decision (44%, down from 47% in Q2), though Directors seem to be gaining ground on the responsibility (29%, up from 23% in Q2).

Most decision-makers continue to report that security teams are vetting vendors before a purchase is made (70%, down from 71% in Q2).

“In my experience, going with a team approach on selection makes a huge difference.”
- VP, large finance company

Respondent Breakdown

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