DocuSign, a leader in the fast-growing e-signature market, is known for selling to individual business units, which results in multiple, disparate agreements across a customer’s organization. The vendor offers two different licensing types – Business Pro and Enterprise Pro (the latter features more functionality and a higher price) – and each type requires its own separate agreement. This situation frustrates customer efforts to consolidate deals, which would require an upgrade to the higher priced license.
To further complicate things, the DocuSign license metrics consist of “Seats,” which refer to licensed users, and “Envelopes,” transactional one-time-use licenses which are used as needed, then expire. In the many cases we’ve observed, for every Seat license sold, the user gets access to 100 Envelopes.
A global client brought us a case which included 13 separate DocuSign agreements for both Seats and Envelopes, which they wanted to consolidate. The goal was to simplify management of the license purchase and generate leverage by combining the thousands of different licenses needed. In addition to the different license types, the proposal included pricing in several different currencies that required conversion to US dollar amounts (Euro, British pound, Australian dollar).
This client wanted an over-arching DocuSign agreement that would allow the individual business unit to purchase licenses as needed. They were able to work with DocuSign to develop a set of pricing that would guide each business unit’s purchase and maintain consistent pricing across the organization.
In response to the increasing demand for consolidation, DocuSign offers two choices: customers can opt for one single agreement that includes a large pool of Envelopes that are available to an entire organization. This type of agreement requires a designated team to negotiate, administer and manage the pool.
The other option calls for “Governing Tiers” which lets the business units reset the baseline pricing and buy as needed from one pricing structure negotiated for the whole organization. This option does not allow buyers to leverage the purchase size of the agreement but does enable some flexibility. Each business unit can determine how much and when they need DocuSign licenses but still pay pricing that is aligned with the rest of the business. The client negotiates a set of tiers with the vendor, which are based on the license type and metrics needed, and the business units buy at established prices. The downside here is that DocuSign will still pursue the customer’s same annual run rate, so it may be challenging to reset existing contracts without significant leverage – which typically comes from growth.
For clients that wish to consolidate their purchasing with DocuSign, we recommend the following steps:
Identify a central team to inventory and map DocuSign usage and need across the organization
Consider an early renewal that unifies the organization’s purchases and proactively makes a case to the vendor
Include competition from the e-signature marketplace (Adobe, Right Signature and Hello Sign to name a few) in negotiations, and leverage quarter-end and year-end (January 31) dates to motivate the sales team to make concessions.
For more information on negotiating with DocuSign, please contact your Accenture representative.
- Lauren Savrin is a Senior Analyst at Accenture.