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6 Keys to creating a great B2B customer experience

B2B companies are witnessing a shift in the sales process from brand-driven to consumer-driven sales. Where outgoing marketing messages were once the primary means by which a customer learned about a business or product, nowadays, prospects glean that information from myriad sources, most notably each other.From photos to product specs...

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5 Ways to Generate More B2B Deals

As global markets change and become more "local" so the demands on B2B will increase to meet these new opportunities. However, do it right and the reward of increased sales can be achieved. Consider some of these ...

  1. 25% of a salesperson's time is spent doing research - not only is this a massive resource cost on a collective basis to businesses around the world, but were you to provide comprehensive information that was easy to find and on which to make a buying decision together with an easy purchasing process in a single place and rather than scouring the world, the salesperson will see your commerce site as a preferred source.
  2. Google does not generate B2B deals - Google will direct a lead to your commerce site, what happens at your site is what will close deals. The better the decision making tools, the better the information provided and the simpler and friendlier the user experience, the more likelihood there will be of a deal being concluded.
  3. Only 35% of B2B social branding generates sales - Business makes buying decisions based on information, solution building, price and numerous other factors. If you consider that 65% of the sales are generated by these factors, then your B2B Commerce site and systems must provide the features to deliver the relevant content to your visitors.
  4. BRIC is growing rapidly - Use your B2B Commerce platforms to expand your business to the largest growing economies (Brasil, Russia, India and China). While your B2B Commerce platform needs to support localized payment, language and service needs, B2B offers you a way to enter these markets and to generate new opportunities.
  5. Use Multiple Channels - It is a global multi-channel road ahead to reach more customers through more touch points. Expanding your B2B allows you to go-to-market using traditional and emerging sales channels like resellers, on-line stores, subscriptions, in-product consumption, AppStores, social purchasing and mobile commerce.

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Why Should Software Vendors Create and Monetize Their Marketplaces

Apple has beyond any shadow of doubt proved that a monetized marketplace delivers great returns for them, an awesome go-to-market opportunity for their developer community and passionate customers.

B2B software vendors, however, are slow to take advantage of this phenomenon. There are numerous reasons for this but that is another topic. Here are some reasons why software vendors SHOULD be looking very seriously at building their marketplace … even if it is only a small one.

The Most Important Reason - Generate More Deals

Ultimately it boils down to two facts above all as to why software vendors should have a marketplace included in their multi-channel sales and marketing mix …

  • It generates more core sales; and
  • It builds a great echo-system!

How is this achieved … see the list below!

Customer Expectations

The user experience expectations of customers is shifting and being driven by their consumer experiences at marketplaces such as the Apple AppStore, Android Markt as well as their purchases from on-line stores such as Amazon and Zappos.

This is increasingly adding demands on software vendors to provide a similar user experience to their customers when they are looking for, evaluating and purchasing business software.

Functionality Critical to Closing Deals

No single product can provide all the functionality needed to deliver the complex systems required by the modern business. Independent Software Vendors (“ISVs") form a vital part of the solution chain by adding those features and functions needed to close deals.

Further, on average salespeople spend 25% of their time seeking out information to build customer solutions. This time is expensive and could be better spent on lead and deal generation activities.

A marketplace that promotes both core and add-on software makes products and related information easier to find and evaluate thus making it quicker and easier to build solutions while also making the software vendor more competitive, customers happier and the ISVs motivated to continue investment into developing vital add-on solutions.

Earnings to Invest Back Into The Channel

Budgets for channel development are always under pressure and yet for the average software vendor their channel is critical to revenue growth. So which comes first – investment into channel or revenue?

A marketplace can and should be a profit centre where the extra earnings generated could be used to top up the lagging budgets for channel development, which in turn would have a positive impact on core revenue generation.

Increased Internet Marketing – For Free

Gaining high rankings in search engines together with the demands on software vendors to use social networks to promote themselves on the web is a time consuming and costly exercise.

A well constructed marketplace that provides an environment for the vendor’s echo-system to congregate, communicate and transact would result in large volumes of traffic, links and in-bound content being created for the marketplace.

As opposed to paid search, on-line advertising and paid staff to create blogs, tweets and other social network updates, this can be achieved at zero cost through the marketplace and the echo-system.

Enhanced Service Delivery

The web is a low cost and efficient way to deliver new or enhanced services to a software vendor’s echo-system. These services can include skills sourcing, project resourcing, training and support.

This service delivery can improve the effectiveness of the channel and provide a convenient way for customers to consume products and services.

The marketplace is a great way to deliver these services and as a by-product the traffic also creates the opportunity to on-sell additional products and services.

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Apple has proved it works for consumers. Now it is strategic for business.

Before SaaS, Social Business or any of the myriad of buzzwords currently common to our business day came Apple and to put it quite simply Apple has changed the buying and consumption habits of millions of people around the world and in turn, has impacted heavily on our business models.

While Apple’s focus is on the consumer and the model does not directly translate to the business space, the influences they have brought to the business world include:

There is an App for everything: If there is anything you want to do on your mobile device, the chances are that there is an App for it. These Apps are also easy to find, evaluate and purchase.

Simplified decision-making: Because the Apps are easy to find and compare and the information provided about the products is comprehensive, the decision making process is made much easier for the consumer and the time to make the decision is substantially less.

Money can be made by helping others to be successful: Creating an extensive developer ecosystem and then helping them to reach consumers has made millionaires of some of the most unlikely people. It has also delivered an invaluable service to the consumer at really good prices. And yet, as is easy to see, Apple has made billions out of it!

Growing a passionate and loyal ecosystem: If we all had customers and suppliers as passionate as those that Apple has … well I guess we could all be an “Apple”. By delivering quality products at acceptable prices in a way that is easy, safe and reliable, Apple has endeared their ecosystem and been envied by their competitors.

If your brand is used to help others – take a share: Apple has created a brand that is highly valuable and enriches the ecosystem. The building of the brand and maintaining its stature is not cheap. While the ecosystem is synergistic to Apple’s success, Apple has provided the framework within which the ecosystem can thrive and make substantial returns. It is only fair that apple take a share of this success.

Can you strategically afford to ignore this phenomenon and not look at creating your own ecosystem driven marketplace.

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A Software or SaaS Marketplace is NOT just an AppStore

A Software or SaaS Marketplace is NOT just an AppStore


The common perception is that an AppStore is the start and end of a software marketplace. While an AppStore certainly forms a part of a B2B Software Marketplace, it is by no means the only important element of the marketplace. As defined by Collins, a marketplace is ...

marketplace (ˈmɑːkɪt,pleɪs) — n,

1. a place where a public market is held
2. any centre where ideas, opinions, etc, are exchanged
3. the commercial world of buying and selling

With this in mind, while a B2B Marketplace could exist with only an AppStore it really should include each of the elements in the definition to deliver a comprehensive service to a software vendor's ecosystem.

Lets take a look at a few of the different components that could make up a marketplace and how each impacts on the software vendor.

AppStore (or eCommerce driven product catalog)

No single product can provide all the functionality needed to deliver the complex systems required by the modern business.

Independent Software Vendors ("ISVs") form a vital part of the solution chain by adding those features and functions needed to close deals.

Further, on average, salespeople spend 25% of their time seeking out information to build customer solutions. This time is expensive and could be better spent on lead and deal generation activities.

If you consider that 65% of a buy decision for business software is based on information delivery, a marketplace that promotes both core and add-on software makes products and related information easier to find and evaluate thus making it quicker and easier to build solutions while also making the software vendor more competitive, customers happier and the ISVs motivated to continue investment into developing vital add-on solutions.

Skills Market

The people and businesses with a diverse set of skills that makes up the software vendor's ecosystem or supply chain is critical to the successful sale, implementation and support of systems for end users.

Having visibility of these skills on a global basis provides an invaluable tool for ensuring that the vendor remains competitive by knowing where skills can be deployed or where training and recruitment may be required.

Further, the ecosystem can advertise their projects, resources and skills and then share this information to better execute sales and project opportunities. This together with a comprehensive collection of information on the projects and skills available, makes it possible to quickly and easily find relevant information and to then review them in-depth. This will ensure that projects are efficiently resourced and that channel partners, with the appropriate skills, can be found and contracted.

A vendor can also monetize this skills market and utilise these funds to reinvest back into the ecosystem.

Self Help

How many calls a day does the average vendor get from their ecosystem requesting information about invoices raised, licences sold, activation codes lost and account detail updates to name just a few.

Providing a set of self help portals to each of the members of the ecosystem saves vendors the time and cost of dealing with these issues while delivering an added service to their ecosystem by making this information easily accessible.

To have access to a portal would also require the community member to register for an account. This account can be designed to require the accountholder to enter various types of profile information and to subscribe to a marketing "opt-in". The profile information and opt-in provides a substantial benefit for executing marketing and promotional activities.

Traffic Analysis and Lead Generation

Providing a range of touch points to attract the ecosystem and new potential customers and partners to the marketplace brings with it new sales opportunities.

Effective measurement of the source of the traffic and profiling their activity in the marketplace would bring about intelligence that can be used to understand areas of interest, product demand, referring sources, marketing an promotional activity effectiveness and ultimately generate new sales.

Given the clear and important benefits of having a professional marketplace, vendors that do not have a marketplace must realise the strategic importance of having one and for those that have started the process but still only provide an online catalog, it is time to properly construct and monetize the marketplace.

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Marketplace + Traffic + Monetization = Increased Sales and Earnings

A practical guide on how to use your marketplace (including your Enterprise AppStore) to grow traffic and generate new revenue opportunities

For business software vendors, generating repeat traffic to their sites is challenging but if it is achieved can be very lucrative.

“It is far more profitable to provide products and services to existing trading partners than to find new ones.”

Trading partners in this context should be considered to include end-users, resellers (partners, system integrators), ISVs, distributors and current/ex-employees of these organizations.

Of course, no traffic generation should exclude new trading partners so a broad approach to traffic generation, which envelopes both old and new will drive increased traffic and will leverage new revenue opportunities.

So how do you increase return traffic to your website and how do you then monetize that traffic?


“Having a great looking website or product catalog is not enough anymore!”

Step 1: Create a Marketplace

The first step is to create an environment … an “enterprise software marketplace” … that provides multiple reasons to encourage your partners to return. Some of these reasons could include, but not limited to:

  • Efficiently finding and purchasing add-on products to compliment their implemented solutions
  • Rich content (not just web pages) to help buyers with the evaluation of add-on products and services
  • Finding resources and skills to assist with projects, training and support
  • Connecting with the broad ecosystem to share information and experiences
  • Tracking and managing the licenses for the products they have purchased or on-sold
  • Managing the range of subscription, on-premise and mobile solutions being deployed


The marketplace should also provide your partners with an experience that matches that of their consumer web experiences (e.g. the Apple AppStore) by providing a broad set of functions to simplify the finding, decision-making and buying process.

Choosing the correct marketplace platform with the appropriate functionality is critical to being able to achieve this. View this post for more information in this regard: A Software Marketplace is NOT just an AppStore !


Step 2: Build Your Traffic

So now you have a marketplace and a functional platform on which it runs. Now for the real challenge, using that marketplace to attract the traffic. Here are a few ideas …

Simple use of your existing marketing activities:

  • Create Blog, Twitter and LinkedIn posts that point back to your marketplace
  • Add your marketplace URL to email signatures and all outbound marketing collateral
  • Put a link to the marketplace on your homepage
  • Get your partners to put links to the marketplace on their websites
  • Include the marketplace in your next newsletter

Add “Rich” content to the marketplace:

  • Have your ISVs and complimentary product developers add their products and services to the marketplace and include videos, brochures, technical info, screenshots, downloads and more.
  • List your resellers, distributors, system integrators and service providers with comprehensive information about them – not just a list with a link to their website!

Use your marketplace platform:

Your marketplace should provide the functionality to make traffic building an integrated part of the day-to-day activities of your ecosystem. The more effective this is, the more it will reduce the need and cost of having separate resources to execute these functions while still seeing an increase in marketing activity for your brand.

Some examples of this as follows:

Promotions: Motivate your ISVs to create special offers and promotions for products and services held in the AppStore.
   
Outbound marketing: Push outbound marketing with links back to the marketplace for promotions, job offers, resource requests, new products, whitepapers …
   
Social Networks: When the outbound marketing is created and sent to your community, update the social networks with these items as well.
   
Downloads: Make bug fixes, demo software, new releases and software updates available through the marketplace. When these are uploaded to the marketplace, promote them through notifications to your ecosystem.
   


The more your ecosystem does in your marketplace, the more FREE marketing and promotion you will get.”


Note: There is substantial merit in mandating your ecosystem to register an account in your marketplace so that an opt-in can be secured for marketing and promotional activities that will be used to drive traffic back to the marketplace.

 

Step 3: Monetize your marketplace

It is a common reaction to be circumspect about monetizing your ecosystem outside of the provision of your products and services, however this should be considered in the context of an improved service to the ecosystem as opposed to a “money-grab”.

There are many reasons why this makes sense but that is not the topic of this post so please take a look here for more information about why you should monetize your ecosystem beyond your products and services: Why Should Software Vendors Create and Monetize Their Marketplaces

Some of the ways in which you can monetize your marketplace include:

Memberships: The provision of the marketplace adds substantial value to the ecosystem. Providing this service for a small monthly fee results in the community member actually using the service as well as that it adds deemed value. Something for nothing is normally just that … Nothing !
   
Share of Sales: For your ISVs to implement a solution of their own to manage their sales, installed customer base, marketing, subscription billing, payment collection, etc. would be a substantial cost in time and money and would require a steep learning curve in an area that is not core to their business. For providing this together with the fact that you are driving new sales opportunities to them through the marketplace justifies a sharing of the margin on a sale.
   
Skills Transactions: When your ecosystem is looking for resources, no matter whether it is end-users, ISVs, resale partners, etc., providing a closed community resource pool with known skills will always deliver a more targeted result for the potential employer/contractor and keeps the skilled employee/organization in the ecosystem. By providing the ability for people and organizations to advertise and find appropriate resources efficiently at reasonable rates can add substantial earnings to your business.
   
Advertising: A corporate website should never be a place where advertising clutters up your brand. However, in a marketplace this advertising, if done with proper relevance based targeting, can provide a great service to showcase products or services that are currently in the users area of interest. By example, a user searches for an add-on product for business intelligence and a range of appropriate ISVs can promote their products to this user through targeted advertising.
   

These, together with a range of other leveraged revenue opportunities can deliver substantial earnings to your organization. Based on studies we have completed, increased earnings of 3% and more can be achieved through the monetization of a marketplace.

These earnings can both add substantial value to the business or if reinvested into the ecosystem, can make them more effective in the market and continue to build your brand.

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Business Software Product Ratings Are a Bad Idea

No RatingsIn the enterprise software space, showing product ratings is not always a great idea.

There are a number of reasons for this:

  • Implementations fail for many reasons and it is not only the product that is at fault. In most cases the cause is a combination of issues such as the end-user not specifying their requirement properly, a systems integrator that did not do their job properly or a budget that overran.

  • As human nature goes, users are more likely to rate a failed implementation than a successful one so the product may in many cases have 1000 great sites but one bad one and that is the one that gets rated.

  • The first product to get ratings will by and large make it extremely difficult for other equivalent products in the same marketplace to get traction. Potential customers will typically be presented with the highly rated products first and this prevents other products, which may in fact be better, from being given a fair chance at the sale.

  • If products are continually beaten by others in the marketplace because of their "first to market" ratings, then there is no incentive for them to remain in the marketplace and as such you loose the developer and your ecosystem looses a potential solution.

This is not to say that all products are equal or that some should not be forced out of the market, but it does suggest that this is not the responsibility of a ratings engine to decide.

As an alternative, the following could be used:

Rich Content: All products in the marketplace should have rich content which properly showcases its features, benefits and successes. This content can include customer stories, public relations, product videos, vertical market solutions, brochures and downloads.
Developer Programs: Define minimum standards through your ISV programs that dictate the status required in order to publish products in the marketplace.
Developer Profile: Awards, years in business, number of customers, areas of expertise and the developer membership status can be used to profile the developer as an organization.

Although a bit more effort is required, there are many ways to properly provide relevant and rich information to customers so that they can make a quality purchase decision without risking the potential dangers of relying on a rating.

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3 things that will transform the future of a business software vendor

disrupt_220.pngWith cloud, mobile, social and big data advances all happening at once and at lightning speed, how will shifts in technology impact the way software businesses are run?

Ginni Rometty, CEO of IBM, recently made a prediction that three key areas will change everything. These three areas are:

- Data analytics will drive business decisions
- Social Networks will impact on value delivery
- Individuals will no longer be aggregated

Here is a look at how these may affect the modern software vendor.

Data Analytics – “business decisions and opportunity creation”

As potential customers use technology more and more in their assessment and purchasing processes as opposed to traditional face-to-face sales relationships, so the use of data will become more important to understand markets, drive content delivery and to predict futures.

Data will also be used to understand what customers have already consumed and where there are opportunities for complimentary products and services.

For example, a customer may have purchased a financial ERP solution but they are a manufacturing organization so they should also have MRP applications in their solution mix … where they do not currently have this, so analytics would highlight the opportunity.

This could be reinforced by analyzing the movements of individuals in the organization as they review content on a site … they would be downloading brochures, reviewing certain products, viewing videos, etc. If this happens to be MRP related material, then the analytics would increase the rankings of the opportunity.

Social Networks

While these networks in years past were predominantly used in the social lives of individuals, as those people start to permeate into the business world, so is the use of social networks becoming integral to their day-to-day business activities.

These social networks will be used for finding information, rating products and services and getting feedback from existing customers.

Business software vendors will need to drive more of their content to these social networks so that it is readily available to their potential customers.

Individuals – “the depreciation of aggregation”

Rometty put it like this ... “What you will see with rapid data and social sharing is the death of the average and the introduction of the era of you”.

As opposed to using aggregated segmentation to target customers, the data and social changes together with the emerging technology to use these will allow business to interact at an individual level and cater to their specific needs and wants.

In the business software arena this is desirable and necessary as no two businesses are identical and so the solutions created need to be unique for each customer. As such, the successful sale demands this “individual” approach.

These changes will need a cultural and mindset shift as well as the adoption of new technologies and systems (for example Ecosystem Management Platforms) to support the business software vendor through these changes.

While the challenges would exist, the opportunity to unearth new opportunities would be substantial.

 

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In-App Purchasing – Is it effective for enterprise software ?

in-app.pngWhile In-App purchasing is a growing and successful sales channel in the mobile consumer world, is it a viable strategy for enterprise software vendors?

To keep this article in context, we will define an enterprise system as one where it is in use by a business and there are 5 or more users of the application.

Well the jury is out on this … and based on early evaluations, with the different drivers surrounding enterprise software, it is unlikely to be as effective. What is more, if this is done at the exclusion of having a traditional product marketplace, then the sales model is more of a risk than an opportunity to the vendor.

Here are some of the reasons why:

New deals: For new customers that do not currently have any of the vendors products they cannot do any In-App purchasing as they have no App in which to do it! Where the solution requires a mix of products of the vendor and add-on products, then a marketplace rich in content and information is essential for any hope of selling to this customer.

The purchase process: At the time that an application is required, there is typically a requirements process that is completed. Once done, then a search and evaluation exercise will get underway from which a purchase decision would be made and the internal purchase workflow would come into play. This does not augment In-App as a sales channel.

Who makes the decision: The user is, in most cases, not the person that will be making the decision about a purchase and is also not likely to be the person looking for new functionality. As such, the In-App adverts are wasted on this user.

Trusted advisors: Where the enterprise uses a vendor’s partner for their purchases, implementation and support, they will in most cases turn to them as their trusted advisor for assistance in finding, selecting and purchasing new applications.

Volume: Typically, In-App adverts deliver products relevant to the section of the system in which the user is currently working. Any number of products could be available to enhance this part of the system and so the sheer volume and lack of the ability to filter this based on the users defined requirements would render the adverts ineffective. It is likely that the user would still navigate to a content rich marketplace to exercise a selection process.

A frustrating distraction: If there is an “off” button, it is highly likely that users will turn off the distracting adverts. If there is no “off” button, then it is likely that the help desk will be receiving a few calls to find a way of doing it.

In-App purchases of enterprise solutions may generate some demand by catching the right user at the right time with the right message but given the challenges, would need to co-exist with other sales channels and models and is unlikely to be the model that actually generates the enterprise add-on application sale.

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Differences between AppStores, WebStores, Catalogs and Ecosystem Marketplaces

Ecosystem MarketplaceFor Business Software Vendors, the need to implement a more encompassing ecommerce solution is becoming more prevalent every day.

This is being driven by a changing landscape in which the industry is seeing new sales channels, new deployment methods, new revenue drivers and new business models which in turn are affecting the rest of the business operations including marketing, channel management and accounting.

Once the vendor has recognized their need for an ecommerce solution to manage their changing business, they then face the challenge of figuring out which of the myriad of options out there best suites their business.

This is especially difficult for vendors that have an established and complex ecosystem of resellers, ISVs, end-users, distributors and skilled resources as the ecommerce solution selected needs to keep these entities involved in the transactions.

The following chart shows the types of ecommerce features needed by a channel focused vendor and the ability of different types of systems to deliver them.

 

Function Marketplace Webstore Catalog App Store
         
Self Help Portals supporting the whole ecosystem including partners, distributors, ISVs, end-users, branches, “crowd”
Multi-Channel Sales model support including Web, Mobile, In-App, Channel
Multi Party Transactions to include multiple trading partners in a single transaction
Limited


Limited

Multiple Product Types including Mobile, On-Premise, SaaS, Hosted, etc.
Automated Notifications
Traffic Analytics
Payment Processing


Limited


Limited
Inbound Marketing
Limited

Limited

Limited
Outbound Marketing


Limited


Limited


Limited
Complete product collateral including video, PDF, HTML, presentations, spreadsheets, etc
Limited
Fully integrated across all components i.e. each of the features listed in this table should be integrated with each other to provide a single cohesive solution
Skills Market
Ecosystem Profiling
Limited
Ecosystem monetization e.g. membership fees, product placement fees, skills search, advertising etc.
Ecosystem activity integrated to social networks
Drives traffic back to the vendor
Vendor shares in revenue
         

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A Cloud Product Strategy Is not Enough

More than SaaSWhile the promise of new and large revenue streams for business software vendors is driving huge investment into developing cloud strategies it seems that there is much being overlooked in the process.

Building the cloud product strategy is just the starting point with a number of areas being sorely neglected and which will come back to haunt technology executives in the near term

As a part of a comprehensive roll-out, the following represents some of the items that should be addressed …

Most vendors will have existing legacy customers that will take time to cross over to cloud and there will still be a substantial demand from new customers that wish to stay with on-premise solutions.

The challenge here is how to build a hybrid sales channel that caters for both cloud and on-premise customers and where the customer can engage in an individualistic way.

For example a customer may want to review, test and purchase an on-premise solution through the web whereas another may want the same solution but wishes to engage a channel partner from the outset. The end result is the same but the path to the result is substantially different and needs to be catered for in the sales model.

For a cloud solution to gain substantial traction, the solutions available need to be comparable to those which are available in the legacy on-premise solutions. These solutions are made up of both the products from the vendor as well as complimentary products from their ISV partners.

If the ISV products are not made available in the cloud offering, it is likely that the customer will be unable to construct a solution to meet his requirements and thereby the vendor would risk losing the client and will not be able to convert existing customers to their cloud offering.

To achieve this, the vendor must provide the tools necessary to help the ISV integrate and deploy their products together with providing the relevant ecommerce solutions to promote, sell, invoice and collect payment for the ISV products.

While the vendor website in the past was adequate being an information delivery tool, moving to cloud products creates the demand for the website to now also provide ecommerce capability for the consumption and management of the products and ecosystem.

These ecommerce solutions are not the typical B2B or B2C type web-store solutions as they need functionality that will provide a solution to functions such as subscription billing, system provisioning, license management, multi-party transaction splits (e.g. commissions for channel partners), multiple sales channels, multiple deployment methods and more.

The ecommerce solution would also need to provide the ability to list and sell both the vendor core products as well as the ISV complimentary products to afford the customer the ability to build their perfect solution … much like an advanced AppStore.

At the same time, the cloud introduces an environment which puts distance between the customer and the traditional channel however the services provided by the channel are essential to the successful implementation of solutions for the vendor’s customers and unless the channel is engaged, the vendor will need to set up their own service resources which at the end of the day is very likely to set off any benefit derived from offering cloud products.

So while the topics covered here are not exhaustive, they illustrate the issues that need to be considered in conjunction with any cloud product strategy.

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Are You a Dog - The Internet Does Not Care


Are you a dog - The internet does not careSo you are a small or medium sized software vendor and with tough competition out there you need to be perceived to be bigger and better to close more deals.

Well if ever there was a reason to embrace the web trend for SMB software, this is definitely one of them.



Business is becoming more and more comfortable with finding, selecting and procuring solutions on-line. The argument about traditional sales processes requiring trusted advisers to hold the customer’s hand from start to finish is becoming myth rather than reality … although many software vendors still find it hard to believe that the world has moved forward.

Sure, in many cases, there is a need for the channel in both the sale and implementation of SMB software but they are getting involved much later in the sales cycle and customers are looking for products that do not require the same intense levels of channel or direct involvement as was needed in the past.

We just have to look to the stellar growth that many “new age” SMB software providers like Xero, Box, Intacct, Salesforce.com and others are seeing to understand that the demand is there and that SMB software vendors need to embrace the trend and move their businesses in that direction.

So, apart from product, here are a few pointers that should be considered to help make your business more competitive.

Get active with SEO: If you want to be found this is essential and it does not have to burden you unduly. There are many great tools out there that are inexpensive and easy to use and with minimal time and effort will enhance your profile immensely.

Give your website a revamp: This is the first perception that a prospective customer will have of your business. Use an open source CMS system, add a standard off the shelf professional template, convert your existing content into your new CMS and you are up and running.

Add new quality content: More than 75% of an SMB's purchase decision is based on the information available on which to base his decision. By providing both quality and quantity content, the potential to sell grows exponentially.

Implement an ecommerce solution: There are many studies that show how a multi-channels sales approach and a frictionless purchasing process can substantially increase sales. By implementing an ecommerce solution you can both add a new sales channel and simplify the purchase process for the customer.

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Increase Sales, Drive New Sales Models, Deliver Multiple Deployment Methods and Manage The Business

Ecommerce, Operational and Marketplace SolutionsSoftware businesses are being affected by the growing demand for:

  • Subscription billing
  • Multi-channel sales models including In-App, Web and Channel
  • Multiple product deployment types such as SaaS, Mobile and On-Premise
  • Web merchandising, marketing and promotion
  • Delivering a better customer web experience

To achieve this, software vendors need an integrated ecommerce, marketplace and operational platform that would provide the relevant functionality to:

  • Support multiple sales channels including on-line, direct, through partners and In-App
  • Sell, track, manage and deploy on-premise, SaaS and mobile products
  • Increase Sales through turning traffic to your website into customers by delivering a rich environment where prospects can find, review, test and purchase products
  • Create new sales opportunities by using "big data" to identify trends, user interest and merchandising effectiveness
  • Process subscription billing and payment collection for your SaaS and Hosted solutions together with billing your legacy Annual Maintenance Fees
  • Create a Marketplace ("App Store") of both your products and those of your ISVs to assist your channel and customers in building comprehensive solutions quickly and easily
  • Provide a rich Resource Library of technical, marketing and downloadable content
  • Automate Notifications for support, marketing and merchandising events delivered directly to your ecosystem as well as to social networks
  • Give your ecosystem the tools they need to make transacting with you simple yet comprehensive through highly functional self-help portals
  • Keep your partners engaged by ensuring they are involved in relevant sales transactions no matter which sales channel drives the deal and automate multiparty splits on these transactions
  • Make it easy for your customers to find suitably qualified systems integrators, consultants and staff while creating new business opportunities for your channel through a Skills Market

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Yosemite, Mountain Lions and Software Vendors

Yosemite, Mountain Lions and Software VendorsYosemite, Mountain Lions and Software Vendors I recently visited Yosemite National Park and was at awe with the immensity and beauty of it all. It was also a touch daunting at the thought of how big it seemed and how small I felt against it.

I then came across an article in the Yosemite Guide publication, which got me thinking (please read the article “What should you do if you meet a mountain lion?” attached) … In our insignificant world of enterprise software we have our behemoths like SAP, Oracle, Microsoft and IBM. They are all-powerful and will be around forever, taking control of the world below them. You just have to look at the struggling HP to see how these entities can survive massive disruption.

These organizations could be seen as the Mountains of Yosemite.

However, our world of business software has Mountain Lions who can hunt and by being agile, smart and hungry can find a space where they can flourish and build great success. By embracing change and in many cases creating disruption of their own, they carve out of the rock a sector that they can own and grow. Some great examples of this would be Salesforce.com, Box, Xero, Atlassian and Splunk.

Then there are the small un-funded software businesses with great people and ideas but are still finding their way. These businesses can be successful by following in the footsteps of other startups and by transitioning from the “hunted” to being a Mountain Lion. These small businesses need to do everything they can to be perceived as being stronger than they are. The web has delivered to them the best opportunity ever to “fight back” and to be seen as a relevant entity.

By using the ecommerce (subscription billing, marketplaces, portals), social marketing (LinkedIn, Twitter, Blogs) and web hype (“if it is on the web it must be true”), any business can create a presence and attract new opportunities. Just look at the explosion of subscription and mobile solution demand and it is easy to see how a small software vendor can take advantage of a disruptive environment.

Besides creating great products, smaller software vendors can use technology to grow their own businesses and should be actively embracing those web tools that can help them achieve it.

Of course many of these ideas will still fail because not every idea can be a winner and because not everyone can effectively execute but even those that fail can still have their moment of fame through the web.

From a different perspective, for this exact reason and from the consumer perspective, they have to be careful how they select their “web” suppliers … but that is a different topic.

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Build Channel Adoption of Your Cloud Initiatives

a1sx2_Thumbnail1_Cloud_adoption.jpgFor those vendors that rely on their channels to go to market, there is the challenge of motivating them to adopt new business, deployment and revenue models. 

In this post, we look at some of the challenges being faced and solutions to them.

Revenue Sharing

In the past a license would be sold, the customer would pay a lump sum fee and the partner would take 30% of the proceeds.

The license fee, if we were to ignore annual maintenance fees for this purpose, represented the lifetime value of the deal and all parties involved would share in it.

With the shift toward subscription based licensing models (whether on-premise or SaaS/PaaS/IaaS), the revenue sharing structures seem to have shifted with them in that vendors are reducing the percentage they offer and also it is being spread across the lifetime of the subscription … in some cases even the period of earning for the subscription is limited.

Given that we are not talking about short sales cycles typically associated with SMB Cloud Apps, the cost and risk associated with the sales process is borne by the partner and yet the return is lower and spread over a period of time … this automatically creates a barrier to them eagerly promoting the new model and where possible will always revert to the on-premise model.

To get the channel to eagerly adopt the new models, it is essential that the lifetime value of the deal be properly measured and that an equitable share be offered to the partner.

Take a look at this article for further insight into channel compensation … “Cloud Channel Challenges | SaaS Channel Compensation”

Solution Building 

The vast majority of systems sold are made up of components both from the core vendor products as well as those from development partners. Where the complimentary products are not available, a solution cannot be built for the customer and so the deal is lost.

In a study completed by the Cloud Industry forum in their white paper “The critical role of channel in driving cloud adoption” shows that end users value above everything else, the solution that can be delivered. So for the channel to be more effective, building solutions has to be very high on the agenda.

A salesperson typically spends up to 25% of his time researching solutions and 60% of all sales lost are indirectly related to not being able to build the appropriate solution.

Centralizing all the products into a marketplace makes research and consumption of these products much easier and so success rates and the time taken to build the solutions are improved.

For the channel this reduces the sales cost and increase hit rates and so improves their appetite for cloud adoption.

As a by-product, this marketplace also builds new opportunities and simplifies the sales process for complimentary product developers and so enhances their loyalty to the vendor.

Administration and Systems

Critical to the channel partner is the ability to manage his customer relationship. However, when melding this with the vendors desire to get closer to and have more control of the relationship with the end-user, the question starts to beg as to how the transactions between all the parties are managed.

The channel would not be in a position to build the platforms needed to manage the transactions and relationships so given that vendors are the glue that bring all the parties and products together, they would need to provide systems to …

  • Sell through multiple channels with multiple parties involved
  • Assign customers to channel partners
  • Provide both core vendor products as well as complimentary products (and in some cases still offer the on-premise products as a part of the solution)
  • Automate the provisioning of the solution across multiple vendors at the same time
  • Bill customers
  • Collect payment
  • Automate and manage the revenue sharing across the channel

… resulting in easily managed transactions giving both vendors and channel visibility of and control over their mutual customers.

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Can B2B Commerce help business software vendors transition to a direct-to-consumer model

Business software vendors like Sage, Microsoft, SAP and most others are slowly growing their direct-to-consumer model. It just so happens that these consumers are businesses.

A few of the factors driving this shift includes:

  • Consumer experience – businesses are run by people and the experiences that these people have had with their consumer purchases is driving their perception and expectation of business transacting.
  • Technology - it is much easier today for a vendor to deliver a rich experience through new technology like SaaS and mobile.
  • Revenue and margins – these new technologies open the opportunity to migrate existing customers and to attract new customers into recurring revenue models, which deliver substantial margins.

However, to continue to deliver enhanced functionality and high levels of local services, it is essential that the vendor keep their current ecosystem of value added resellers and independent software vendors (“ISVs”) engaged. Were this not to happen, the vendor’s business could be substantially negatively affected.

To deliver a direct-to-consumer model and at the same time deliver a consistent experience for the customer and keep the ecosystem fully engaged is going to add substantial demands on the systems used by software vendors as legacy systems generally do not have the features needed to achieve this.

Consider that if a customer needs a SaaS solution that comprises the vendor product plus two ISV products to build a solution and they are using a reseller to assist with the project to take the system live.

Then, if a suitable system is not in use by the vendor, the customer would need to make purchase decisions on multiple websites, have 3 different recurring billing transactions (if the ISVs have acceptable systems as well!) and have 3 different payment transactions. What about the reseller that is entitled to a commission on the sale?

This would negatively affect the customer experience and the ISVs and resellers.

A new breed of B2B e-commerce solution that provides high levels of features to manage the relationships with customers and partners and to execute the transactions would go a long way to help transition the entire ecosystem across to the new model – this could be termed Business-Commerce™.

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Saxum Commerce are leaders in providing solutions that are critical to the success of a digital vendor's commerce strategy while also assisting them in improving their customers' experience, reducing sales friction and driving revenue growth so that they can focus on their strategy and not the systems that underpin it.