Software Costs driven up by sponsorships? You bet they are...

Is a software provider you are considering in bed with every trade show and industry media outlet on the planet?  Do their paid search words cover the internet in all sorts of odd places?  Are they a Platinum Sponsor of VDP SnoozeFest 2010 and Cross Media Boondoggle 2011 in fabulous Maui?  If so, consider for a moment the high cost of sponsoring and exhibiting at these events. 

Who is really paying for all this?  The massive marketing expenses that these events and sponsorships entail are simply built into the cost of the product.  As we approach another large industry tradeshow, I have to stop and ask myself about the costs incurred and the value generated for the end user.

We believe that these funds should be spent on customer service and product development, not on dunnage, airfare, hotels and hefty sponsorship fees. Even firms lavished with venture capital don't have have unlimited resources.  Exhibiting at one major show buys a lot of customer service hours.  Which would you rather have – a demo by a hired "host" on a $4000 rented plasma TV or domestic phone support available on demand with quick turnaround on custom projects?

So the next time you are wandering through the aisles of flashing lights and cheesy contests and giveaways, ask yourself a few questions.

1. Should a software as a service firm really need a booth and high pressure sales people to educate prospects?

2. Is there anything going on at this software booth that my entire team couldn’t better appreciate during a webinar?

3. And Finally, who’s Paying for all this?

The answers are pretty clear.