Research On IT Service Pricing Strategy Based On Saas Model

In recent years, with the emergence of cloud computing technology and the rapid diffusion of service-oriented thinking, Software as a service provides a new IT service model. Compared to traditional software and information systems development, SaaS provides a standardized software service via the Internet to different consumers. SaaS helps SMEs to effectively avoid the lack funds, the low level of information systems development, and helps companies quickly and inexpensively enjoy advanced IT services. When SaaS vendors adopt this new IT service model, how to make pricing decisions with adaptation to the characteristics of the SaaS model plays an important role for IT service providers exploring the market and consumers enjoying benefits of technological progress.The main purpose of pricing decisions is to maximize the profit service providers, and pricing decisions are influenced by many factors. This paper takes consumer utility of SaaS service as the main analytical tool to explore issues of pricing decisions of SaaS service providers faced.The main work and contribution of this paper focus on the following aspect:Firstly, according to the characteristics of SaaS services, the factors which will affect the cost-based, market-based and value-based consumer SaaS service pricing are qualitatively analyzed. And the factors affecting the value of SaaS consumers are quantitatively analyzed. According to the result of review text mining, consumers pay little attention to the function of software part itself, and the mainly concerned are safety, response time etc. Based on this and combined with the theory of SaaS adoption,this study extracts the key factors that affect the value of SaaS consumers and establish a theoretical model to explore the value of consumer-driven SaaS key factors and the influence degree of different factors. Data research shows that, responsiveness, security, flexibility, reliability and social influence directly and through perceived usefulness indirectly positively influence customer value, rapport only direct positively impacts customer value, price and customer value are significantly negatively correlated. And responsiveness plays the most important role.Secondly, Software as a Service is essentially a bundle of a software product and delivery and maintenance services. This study considers two pricing strategies, bundle pricing and separate pricing. Based on the basic optimization method, it gets best price and maximum profit of the software vendors, and analyzes the boundary conditions of selecting different pricing strategies. And it uses numerical simulation to explore how strategic options to maximize the profits of vendors influencing consumer surplus and social welfare. The result shows that bundling strategy does not necessarily harm consumer surplus, and when the service variable cost is low, the profit maximization strategy and social welfare maximization strategy reach consensus in the bundling strategy and at a high level; when the service variable cost is high, the profit maximization strategy and social welfare maximization strategy reach consensus in the separating strategy and at a low level, vendors need to continuously reduce variable cost to improve profits and welfare.Finally, taking online free trial into SaaS vertical differentiation model, it studies the Bertrand price competition and trial time decision problem of the duopoly SaaS vendors in the market is not fully covered and fully covered. In complete coverage of the market situation, it solves trial duration optimal decision of oligarchs suppliers and Bertrand-Nash equilibrium. In the market is not fully covered, it solves the equilibrium price and analyzes the impact of time trial on the equilibrium by numerical simulation. And it discusses the impact of the differences in the quality and duration of the online trial on consumer surplus and social welfare.