Companies are increasingly investing in digital asset management (DAM) because they seek automation, efficiency, and transparency in their digital workflows and are willing to pay for it.
Market research projects the DAM market will reach $5,287 million in 2023, growing at a CAGR of 13.7% from 2017 to 2023.1
Are you also considering investing in one? If yes, how do you determine how much to pay for it?
If you look up on the Internet, you will find that most DAM providers do not display their pricing details. It is either available on request or listed as custom pricing. We found that the cost could range anywhere from $8 to $1999 per month, incrementally rising as per the model or services. However, these numbers make no sense unless we know the functionalities, features, and services that come with the price.
We will unravel, in this article, the various elements of DAM pricing, understand the influencing factors, and discuss pricing strategies.
The cost of a DAM system depends on multiple factors.
The cost of DAM varies per the range of capabilities or values that the customer adds to the basket. Most DAM solutions offer multiple pricing models that vary per the combination of features, functionalities, storage, users/administrators/user groups that a buyer decides to buy. There is no standard pricing structure that every vendor follows.
Hence an organization will have to evaluate each vendor quote against its needs. For instance, if you are a large multinational company with globally-dispersed teams who need access to DAM for different markets, you might want a vendor who does not impose any constraints on the number of users.
Let’s examine the common influencing factors:
- The number of users
The more the number of users in the organization who are likely to benefit from a DAM system, the higher the value you will gain from it. Most DAM pricing includes a defined number of users. You might have to pay for the additional users if they exceed the plan on offer. However, the definition of a user influences the cost. Most vendors do not charge anything extra if the users are merely going to search, view, and download assets from the DAM.
It’s the power users that matter or those employees who must have the right to modify, delete, or change content or metadata. They will want the administrative privilege to reorganize the library or have collaborative powers for driving content creation and dissemination. The cost of licenses for these users might hike up the cost of a DAM.
- Cloud storage
The cost of cloud-based storage has come down considerably in the past few years. The pay-per-use model allows organizations to pay only for the storage they use, making it highly cost-effective. However, every additional storage required on on-premise servers can be cumbersome and expensive as you would have to buy the infrastructure and hire people to maintain them. The more storage space you need, the more bandwidth you need for assets uploading and downloading, which also adds to the cost.
Some companies opt to use external storage from companies like Google or Amazon. In such cases, you will need to integrate them with the DAM system and remove the cost of storage from the DAM pricing. Many vendors offer plans with specific storage space tailored to meet the average business needs.
It goes without saying that a DAM must provide the tools that allow companies to store, organize, search and download assets. However, these are basic features. Today with advancements in digital technologies like AI and machine learning, DAM offers several enhanced functionalities, such as analysis of asset usage, automation of workflows, intuitive user interfaces, integration capabilities, security tools, AI-based metadata tagging, and link-based sharing capacity.
The more features you add to your basket, the more expensive it will be. Companies need to balance the value of the features they choose with the escalation in the cost to decide which ones are most critical.
Sometimes, off-the-shelf features are not adequate for the organization. For example, you may want to include a feature at a granular level, say for example, creating a default URL for specific file formats that fulfill another set of specifications. Features like these are not usually offered by default by most DAM vendors. However, DAM vendors would be willing to write custom code for their clients to tailor the system per their demands. But this costs them money, time, and effort, making the DAM system expensive and priced differently than otherwise.
However, a customized DAM lowers the learning phase of the employees and promises to evolve with the organizational needs. Since a custom-built DAM maps better to the company’s needs, it brings agility and better utilization.
Organizations need initial support from vendors for implementation, onboarding, and training. Later, they require technical support and maintenance. With every upgrade, employees may need assistance in understanding the new features. Technical glitches could take up valuable time if not addressed immediately. If the company purchases a new MarTech solution, it will need help integrating it with DAM. While the extra charges for the services seem avoidable, often enough, it eases the adoption of DAM and ensures optimization.
Choosing between on-premises and cloud-based DAM systems from a cost perspective
On-premise DAM: Perpetual license model may be safer, but it comes with limitations
The cost of a DAM depends on the infrastructure you choose to have. If you opt for an on-premise system, the DAM will require access to your local area network, as it is hosted on the company’s internal servers. It is the preferred choice for companies that need high security, visibility, and control over their workflows. Most on-premise DAM systems follow the perpetual license model, which means you pay a lump sum for continual usage. However, it suffers from the following drawbacks:
- Requires on-premises hardware
Companies have to invest large sums of capital in setting up the on-premise infrastructure, which includes the hardware, software licensing fees, data server/backup, and more.
- Blocks working capital for the long-term
Maintaining the infrastructure is expensive. You will have to hire IT staff and pay for the hosting costs and energy bills. Any new updates need to be purchased separately.
- Proprietary hardware maintenance
On-premise hardware ties you to the support the vendor provides due to the proprietary nature of the product.
- Limited scalability because of hardware reliance
Any increase in workload will require you to return to the vendor for additional hardware, computing power, or data storage. If the spike is only short-term, adding more resources is not cost-effective.
- Hidden costs
While most companies charge nothing for providing rudimentary support, a comprehensive support package comes with a pricing plan. Migration costs to move data and applications from the existing system to the new one also add to the bill. A vendor may invoice you separately for the customization and training of users. All these inflate the total cost.
Cloud-based DAM: Subscription-based model allows you to pay for what you use only
A cloud-based DAM is a software-as-a-service (SaaS) model where the user gets access to the DAM as software from the Internet. The company’s digital assets live on a cloud server. Since payment is per the resources utilized, it is more cost-effective.
The pricing involves making a monthly or annual payment that gives you the right to use the product without ‘owning’ it. It removes the hassles of maintaining your infrastructure yet gives complete access to all the features, services, and support you need.
A cloud-based DAM is also cost-effective because it offers several benefits:
- High scalability allows companies to grow overnight from 1000 images to 100,000 assets.
- Better asset management and tagging capabilities make it very valuable.
- High-end data security features, including encryption and single sign-on, make most cloud-based solutions highly secure.
- Self-service options allow individual users to handle their workflows independently.
- Flexibility to access and work on assets from any location and anytime makes cloud-based DAM very convenient in today’s hybrid work models. One can update and share data in one go without going through multiple workflows.
- Data rights management ensures compliance.
Cost of ImageKit’s DAM system
Evaluating the cost of a DAM becomes easier if the vendor is transparent about what they are offering in their different pricing plans. Any charges that pop up in the final billing due to ambiguous terms and conditions can be unpleasant.
ImageKit offers three pricing plans – beginning with a ‘Forever Free’ offer that’s a great way to get you started. All you need to do is sign-up. Once you become convinced of the benefits of using ImageKit, you can choose the premium plan at a monthly fee of 49 dollars which allows you to pay per usage. We don’t impose any minimum commitment.
If you are a large enterprise with volumes of assets and large teams or have unique requirements such as speed or security, we can tailor ImageKit for you at over a $500 monthly charge.
We also offer add-on plans for our paid plan users providing dedicated support during custom domain setup and CDN integration.
Visit our website to understand in depth - what we offer, our billing and payment processes, including the support we provide. If you still have questions, drop us a note @ email@example.com, and we will gladly answer you.
To understand which plan would work for your organization, we recommend sharing your requirements with us and asking for a demo; it is free.