© Dwight Foster, Insightly CRM
NEWS AND INFORMATION
© Dwight Foster, Insightly CRM
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 ...
© Saxum Commerce
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 …
How is this achieved … see the list below!
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.
© Saxum Commerce
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.
© Saxum Commerce
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.
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.
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.
© Saxum Commerce
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:
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:
Add “Rich” content to the marketplace:
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.
© Saxum Commerce
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.
© Saxum Commerce
While 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.
© Saxum Commerce
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.
|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||
|Multiple Product Types including Mobile, On-Premise, SaaS, Hosted, etc.|
|Complete product collateral including video, PDF, HTML, presentations, spreadsheets, etc||
|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|
|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|
© Saxum Commerce
To achieve this, software vendors need an integrated ecommerce, marketplace and operational platform that would provide the relevant functionality to:
© Saxum Commerce