by Neil Wynne | April 12, 2018 | Comments Off on How Will DocuSign Going Public Impact the Electronic Signature Market?
I’ve been fielding an influx of calls about DocuSign’s impending IPO, so I figured I’d share some of my thoughts.
For CIOs and IT leaders (my target audience), all of the recommendations in “Market Guide for Electronic Signature” still apply. Brian Lowans and I will be publishing an update later this year at some point in the future*, but the current iteration is completely relevant. Don’t let IPO buzz affect your view of e-signature’s business value or plans to leverage it. E-signature is a mainstream technology with predictable, broadly acknowledged benefits that you should be reaping today.
DocuSign is the largest e-signature player by market share and will maintain this position for the foreseeable future. However, Adobe (Adobe Sign), DocuSign’s closest competitor in both market share and capabilities, has been making a significant effort to challenge it. Other players like HelloSign, SignNow and VASCO (eSignLive) have also been gaining traction and causing disruption in the market.
Two questions that are top of mind for me right now:
- Will DocuSign continue to put new and existing customer relationships at risk with its pricing strategy? Through all of 2017 and so far this year, the number one reason why Gartner clients asked to speak with us about DocuSign was because of pricing. Prospective customers wondered why they would pay DocuSign’s higher price given that competitors were less expensive and had relatively slight differences in capabilities. Existing customers found their renewal proposals jarring, with an average of 30% price uplift. With basic e-signature functionality becoming commoditized and competitors closing capability gaps elsewhere, DocuSign will likely be forced to correct this. To be clear, while the main gripe we’ve been hearing is about DocuSign’s pricing, existing customers typically speak highly of the product’s ability to meet their requirements and address a broad range of use cases.
- How will DocuSign use the capital generated from its IPO? There are plenty of opportunities for DocuSign to throw its weight around. I expect to see some acquisition activity as well as an aggressive expansion in Europe.
Note: As a Gartner research analyst, I can’t own stock or have any other type of personal investment in companies or sectors I cover.
* Update 2019-06: The electronic signature market has evolved to support digital business enablement through collaboration, workflow, BPM, and content management capabilities. Frankly, this is beyond the remit of Brian and I as security analysts so we’ve been working internally to find a colleague willing to join covering this market and provide this perspective; we are holding off on updating the market guide until this happens.
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