Sanjeev Aggarwal's Blog

April 9, 2015

Infusionsoft ICON15: Inspiration and Automation for Small Business Marketing

Laurie: Hi, this is Laurie McCabe and I’m here today for SMB’s Spotlight with Greg Head, who is the Chief Marketing Officer at Infusionsoft. We’re at the ICON 2015 event, which is Infusionsoft’s annual user conference. It’s been a blast so far and I’d like to learn more about it, but Greg, could you start just by telling us a little bit about what Infusionsoft, and about the company in general?
Greg: Well, Infusionsoft is the leading sales and marketing software for small businesses and the company has been around for just over 12 years. It started as a small business that turned into a startup that turned into a growth company. And now it’s one of the largest software companies, with 30,000 small business customers. We serve exclusively small businesses and we have over 600 employees and thousands of partners.
Laurie: And located here in the Phoenix area?
Greg: Yes, located here in Phoenix where we started.
Laurie: Okay, and just to clarify when you say small business–because we know as analysts when people say small business they could mean a thousand different things–what’s small business for Infusionsoft?
Greg: Well, we serve small businesses that have up and running businesses. That are full time and have employees and are still owner operated, which means most of our customers have 25 employees and of that most have fewer than 10. That’s where most small businesses reside, but there’s the mid-market of hundreds employees and on up that we are not involved with at all.
Laurie: Okay, that’s good clarification. So tell us about ICON. This is the third year I’ve been here so I’m very familiar, that it’s a great event, but who is it for? What are the goals for the event?
Greg: ICON is our annual conference for users and partners, and now other small businesses that want to join in on all the learning and keynote speakers and so forth. So it’s here at the Phoenix Convention Center, we outgrew the conference room and then hotel rooms and the largest hotel in Phoenix. It’s kind of a movement that’s been happening and now there are over 3500 people here this week. Here exclusively to talk about small business growth, small business sales and marketing, some on how to use Infusionsoft better, that’s definitely part of it. You can be here for three days and attend very valuable sessions and keynotes on these topics.
Laurie: Yes, we will post a link to where people can get more information about the sessions.
Greg: Excellent.
Laurie: So, can you tell me a little bit more about the Infusionsoft solution, what does it do for small businesses? Why do they use it? What benefits do they get out of it?
Greg: Yeah, the main thing, is that our solution is the small business CRM, the contact management, the customer database, and the marketing capabilities from web forms, to emails, and all the automation needed make things go–because small business owners need to make things go.
Laurie: Right.
Greg: And ecommerce to transact online, it’s all in one system. So we help small businesses that are growing and have customers, leads in their funnel coming off the website and Facebook, the new digital funnel has exploded.
Laurie: Right. Exactly.
Greg: Most small businesses have a dozen different tools to capture leads over here and to sell something online over here. So Infusionsoft is the one system that can organize all of that.
Laurie: And to automate it.
Greg: Yeah, once you are organized you can actually automate. You can set it up to start doing things for you that we used to have to do manually.
Laurie: Right.
Greg: And that’s driving a lot of small businesses crazy.
Laurie: Yes, because you can’t keep up with the follow up and the other things that you need to do on that one off basis in a small company. Well, even in a large company it just doesn’t scale. So if you don’t automate it…
Greg: Yeah, but big companies, for instance, at Infusionsoft, we have IT resources, technology, and money to throw at it. Small businesses need one system that’s going to run and help to do that.
Laurie: Yes, absolutely, and I think that as a small business, that you got to have the inspiration, the perspiration, but then you need automation because if you don’t have that you know that perspiration factor just shoots right up.
Greg: Yeah, that’s right.
Laurie: And you’re killing yourself before long with that. And that gets on to my next question, which is for many small businesses, unless they are sales and marketing coaches, or something like that, sales and marketing is an intimidating thing. Putting yourself out there, fear of rejection and everything else. So when you counsel people about some of the basics, things they should look at when you’re thinking, “Okay how do I take sales and marketing in my company to the next level? Or I realize that my revenues are flat, or my revenues are declining, so I’ve got to do something. Where is the right place to start?” How should they think about tactics, strategy, that kind of thing?
Greg: Well, most small business owners don’t think about it separately, it’s part of what they do, and they’re in the firefight. So the first thing is when we help them, it’s a function of where they are in the stage of their business. Maybe they’ve just quit their job, and now they have the business up and running, and getting sales going for the first time. Or maybe they have some revenues and they’re trying to grow figure out tactics to make it work, and 10 or 20 employees, you’ve got different types of issues there. But primarily small businesses jump right into the tactics to go get people to talk to, to sell or convert online. So they run right into the tactical mode, and that’s where all the beginning is. They have a hard time taking a step back and looking how to optimize all that.
Laurie: Their real objectives are how they are going to measure the improvement?
Greg: Yeah, again they get a little stuck because they are peddling so fast, and they don’t look at the biggest thing underneath of all of that is distinguishing the right market for their products and services. At first everybody goes out and tries to sell to everybody but after a while, you have to start narrowing it down, to the ones who are your best customers and prospects.
Laurie: So I know you have a lot of tools to help people use the Infusionsoft solution, do you also have services to help them figure out those bigger picture things?
Greg: Yeah, well small businesses need help and between our partners and us we help them get Infusionsoft set up and get the system running and helping in their business, and we’re also advising them tactically where they should be spending time to plug the hole. Our partners do consulting as well to help small businesses figure out their marketing strategy. At ICON, over half of the speaking sessions are not about the tactical, day-to-day tactics. We are also trying to help them with ways to think about the business, and how to get through the next hurdle in the business. While businesses get to a once place, then it’s a struggle to get to the next level.
Laurie: Yeah, getting stuck and then unstuck.
Greg: So getting unstuck is a major part of what people get from coming to Infusionsoft, for a few days seeing some other possibilities and getting some tactical help to help bridge some of those gaps.
Laurie: Yeah, I like because we all get stuck in our own ruts. S one last question for you really. For you, what are the most exciting highlights here at ICON?
Greg: Well it’s a big deal for us when we get to be with all of the people that we serve. That’s why we’re here, and we get to hear all the small business stories about the stuck and unstuck. We appreciate that and all the challenges small businesses face. Some of our customers get on stage and tell their stories, and that’s a big part of what we do here. We’re continuing to grow, this is a major movement. And we’re announcing new capabilities in our product and the Infusionsoft payments to make getting paid easier and simpler, and more.
Laurie: Right, so once customers are ready to buy, you can easily process the payment.
Greg: Well, big companies, other departments handle the function of getting paid.
Laurie: We all want to get paid, right? I think that should be a good program, and you also introduced some new things to help them get started more quickly?
Greg: Yeah, there are new resources, we keep improving the resources we have for small business owners, starting with Infusionsoft get started and learn more about the concept that they may or may not know. So that’s part of our help center, and our kick-start services that we offer. And we are always making the software easier because we know small businesses have a passion, and they don’t want to spend all day reading manuals and learning to use something. You know most small business owners are focused on something else. So we try to make it easier to focus on the things that they do, and to get back the time and passion and growth in their lives. Families all that stuff that they thought they’re going to get more of, but didn’t really work out that way, so that’s why we’re here.
Laurie: This has been a great synopsis of Infusionsoft and ICON. Thanks Greg, so much.
Greg: Thank you very much.

See ICON15 event highlights here

.

February 24, 2015

SMB Spotlight: IBM’s Midmarket GM On New Partner Strategy and Programs for SMB and Midmarket Companies (Part 2)

Sanjeev: Hi, this Sanjeev Aggarwal from the SMB Group, and in today’s SMB Spotlight I’m speaking with John Mason, who is IBM’s General Manager for Midmarket. Hi John. Thanks for joining me in this two-part discussion about new IBM developments and solutions that are relevant for the midmarket and SMB space. Continuing our discussion in this second post, we focus on IBM’g go-to-market and channel strategy for SMBs and midmarket.

Sanjeev: How is IBM’s channel involved in marketing and selling some of these new solutions?

john_mason_edit

John: A couple of different ways. So for Verse, for example, we make that available to and through our business partners and they have an opportunity to develop recurring revenue model, annuity model and can also add their own consultative services, things like messaging migration or post-implementation support.

We’ve also introduced something called Watson Explorer for business partners. So, that really gives a very powerful cognitive search and analytics. And through this Explorer program, the business partner can identify high revenue potential and resale opportunities on Watson Explorer and then we continue to expand that obviously into other areas. So there’s are really significant joint market investments that we make together with our business partners.

I believe it’s in the order of 100 million dollar investment in co-marketing that we spend with our business partners together. We invest and they invest and then we jointly market to identify new opportunities.

One example is in the UK where we used a very interesting customer reference from Australia. The rugby team in Australia was using, in this case, SPSS to do predictive analytics on player injuries. The customer was called the Waratahs rugby team from Australia. They were using multiple data sources, looking at the players’ training program, their previous injuries, history of injuries, number of minutes they played in matches, that kind of thing to predict future injury probabilities.

The UK team took that customer reference, turned it into a marketing campaign, which was essentially a mock newspaper. That the UK IBM team together with specific, I think, two or three business partners sent this out to 97 different sports clubs in the UK, rugby teams, soccer teams, cricket teams, with a headline that said, you know something about that particular club’s lead player getting injured in three weeks’ time.

So, they sent, for example, to Manchester United such-and-such a player gets injured in three weeks. And then explained within the text how they could have used the IBM analytics tools working with the business partner to predict and effectively reduce the likelihood of injuries and therefore seen significant benefits to the team, which counts on having a full roster of players, etc.

We sent that to 97 different clubs and within a week we had 47 calls back into either IBM or the business partner asking for a follow-on meeting to see how they could actually take advantage of this same capability. And right now, we’re in the process of qualifying a number of those different opportunities into actual closed deals together with the business partners.

So what’s being indicated there is having an actual customer reference in the industry. Having a partner with the skillset, in this case analytics, and having that partner engaged early on in the joint demand generation efforts that we co-fund. That’s where we’ve seen very high response rates and then a much higher yield on the marketing activity.

Sanjeev: That is a great example, more specifically because small and midmarket would like to know how companies similar to theirs are using these solutions and what benefits they’re getting out of them.

John: Yeah, I think the key is you’re not just talking to the customer about technology but actually listening for their business challenge and in their language that’s relevant to them and their particular industry and turning that technology into a solution to that particular challenge.

So that’s where we’re also working programmatically with a number of our business partners to try to have that intersection point between industry expertise and technical know-how around specific cloud, analytics, mobile and social solution plays that can build on an existing customer reference in the same industry to find new opportunities.

Sanjeev: And I’m sure examples like these will open up new opportunities for IBM not only in accounts that have been familiar with IBM but also net new accounts.

John: Yes.

Sanjeev: Ease of use and the value they’re providing to SMBs.

John: Exactly. Yeah.

Sanjeev: So with IBM having so many products and solutions, how do SMBs find out about some of these new solutions that are innovative, ease to use, cloud-based?

John: A couple of different ways. One is obviously through our business partners. A lot of small and mid-sized businesses treat the business partner almost as their IT department whether it’s a cloud service provider or a more traditional business partner. So, quite often that is an inroad for a customer to start using IBM. In some cases, they may not even know they’re using IBM. It could be an embedded part of a cloud service provider solution that the SMB is buying and it’s actually IBM technology that’s provided there embedded in the solution. So, that’s one way.

Also, through traditional business partners with different solutions that we provide through them. But that is in some ways kind of a second-level connection. It was important for us to also establish a direct connection point for small and mid-sized businesses. In particular, to see what is available in terms of cloud services from IBM and from our business partners.

So, that led us to develop the IBM Cloud Marketplace, which brings together this very broad portfolio of offerings that IBM has itself but also third-party cloud services. And it’s organized, it’s a very simple, you can filter in ways, you can choose by self-identifying, if you like, as a developer or as an IT operations person or as a line of business decision maker. And within the line of business decision making you can choose by horizontal sort of functional area, marketing, human resources, finance, etc. or you can also sort by industry.

So, we’re really trying to use that as an on ramp for a customer to explore some of these solutions that they may not even realize IBM provides. And it could be solutions from third parties. In some cases, they even compete with IBM’s own offerings. We won’t exclude people who have a competing cloud service either. It’s important for us to demonstrate to customers and partners that we want to participate in an eco-system, which is open and allow customers to choose the solutions that best meet their needs, not necessarily force them to buy in the ways that we dictate. So it’s really about being a participant in an active but open eco-system of partners.

Sanjeev: Can SMBs if they go to this marketplace find out solutions that they can try before they buy?

John: Yeah, absolutely. One of the key requirements that we heard was the ability to get a free trial and to have limited free trial period or limited functionality for free for the customer to get a sense for whether this is a good fit. So we have a number of try before you buy type offerings. SoftLayer is one of them. You get a free month of virtual server from SoftLayer. IBM Verse, the communication offering that we mentioned before, has a 90-day free trial. Watson Analytics there’s a free version available, and then depending on which additional sources you want to use, then it steps up into a fee-based offering.

Sanjeev: How transparent is the marketplace for the users or SMBs to see not only the trial solutions but how much is the cloud solution going to cost them on a monthly basis if they do decide to go ahead and acquire that solution?

John: It varies a little bit, depending on the offerings. Obviously, some of the offerings are relatively simple, can be purchased with a credit card, in which case the pricing is clear, up-front on a per-seat, per-month basis which is the case for SoftLayer and some of the other offerings like FiberLink.

Sanjeev: How about like Watson Analytics?

John: Watson Analytics is free right now. We’re moving to additional tiers of fee-based offerings. So the switch should be coming out any time now.

Sanjeev: OK. Thanks. And what resources does IBM have to educate, train SMBs on the adoption of these new solutions? I think some of them you mentioned before. Are there any online videos, information content, online tutorials that can help them with a faster on ramp and different usage scenarios?

John: Yeah. Across every one of these solutions we have a wide range of video tutorials as well as user communities where users can pose questions, comments, share their own experiences as well as more structured tutorial content. Much of this, by the way, is accessible also through the IBM Cloud Marketplace. And so, if you start to explore one particular solution and are looking for more information we usually provide links within that same space to help the user identify more training, white papers and access to the community.

Similarly, by the way, for our business partners we also have a dedicated portal that we’ve just completely revamped called PartnerWorld where we have literally thousands of partners who have access to partner training materials and communities as well.

Sanjeev: OK, great. One last question. Does IBM and its partners have a program to help SMBs migrate from, say, Gmail to a Verse type of a solution?

John: We have several IBM Cloud Certified Business Partners who offer this type of migration, many of who are accessible through the Cloud Marketplace.

Sanjeev: Yeah, because sometimes the issue for SMBs is not only having new and innovative solutions, easy to use solutions available, they need to see how to move to adopt these new solutions based on what they have because in some cases they have lots of existing data.

John: That’s also an opportunity for our business partners to provide their value in the transition and migration type services as well. That’s something that we may not do directly. We, I know, are looking at tools that we could provide to help with that, but it’s also an area that a lot of our business partners have years of expertise in helping migrate from one platform to another.

Sanjeev: Yeah, definitely. I think if you can provide some of these tools to help the business partners make the life of SMBs easier in this migration I think it will go a long way to help both IBM and the partners. Great. Thank you.

John: Sanjeev, one other thing I forgot to mention is also on a cloud infrastructure approach with software, particularly for startups, we’ve also recently introduced a free cloud access On Ramp to help startups get started on using SoftLayer by providing up to $120,000 worth of free usage of SoftLayer for startups. That’s maybe something that they can also consider.

Sanjeev: How can startups can find out about the availability of these resources.

John: That was announced in November and you can view the press release on ibm.com: IBM Global Entrepreneur Program.

Sanjeev: Thanks for this very informative session. I think IBM, at least today, does have a really good roster of products to help SMBs be more productive in their journey to compete with the larger companies. I look forward to seeing the progress some of these solutions make in the upcoming months. Again, thanks for taking the time to talk to me.

John: Thanks, Sanjeev. Appreciate the time and I certainly look forward to continuing the discussion. Thank you.

This is the second of a two-part SMB Spotlight interview with John Mason, IBM’s General Manager for Midmarket. In the first post, we discuss new IBM developments and solutions that are relevant for the midmarket and SMB space. (link to first post)

June 5, 2014

SMB trends driving interest in Online File Sharing and Collaboration (OFSC) solutions

SMB Group recently wrapped up its 2014 Small and Medium Business Routes to Market Study, which examined U.S. SMB technology adoption and the buying cycle in 10 key solution areas. (Small businesses are defined as those with 1 to 99 employees, and medium businesses are those with 100 to 999 employees.) As part of this study, we gathered SMBs’ perspectives on their top business challenges, how technology impacts their business, and their technology spending plans.

One of the study’s most dramatic findings is SMBs’ growing realization that cloud-based services, especially SaaS applications, offer powerful and capable solutions while decreasing capital outlays, risks and operational costs. Among the 10 solution areas we assessed, online file sharing and collaboration (OFSC) solutions is one in which SMBs seem particularly interested.

The online file sharing and collaboration (OFSC) market includes a cloud-based infrastructure and software application platform with a range of functionalities that enable SMB employees—regardless of file format, device, application environment, operating system or location—to:

  • Store and synchronize files from multiple endpoints using a cloud service.
  • Upload, manage and distribute content files.
  • Share files from multiple endpoints (e.g., desktops, laptops, smartphones, tablets).
  • Share files among various applications on a given device.

Share files and collaborate with colleagues within the company as well as partners and customers outside the company.

Several trends are driving interest in OFSC solutions, including the following:

  • Email-based file sharing: The use of email for communication and collaboration probably won’t cease anytime soon. SMBs currently use email systems for file sharing and collaboration. Sending multiple copies of files consumes the biggest amount of storage space, accounting for 70% to 80% of storage capacity and storage system costs. However, cloud sharing and collaboration solutions are helping SMBs gain control over file proliferation and replication as well as storage costs while increasing employee collaboration and productivity.
  • Accelerating cloud adoption: SMBs have bought into the cloud promise—a faster, flexible, cost-effective and secure route to obtain the IT solutions they need in order to create and run their businesses. SMB Group research shows SMB use of cloud business and infrastructure applications is poised to grow from 33% to 44% over the coming year.
  • Decreased costs:Cloud-based solutions deliver applications to users over the internet without requiring the purchase of supporting hardware, software or ongoing maintenance. Because cloud vendors manage all of their customers on a single instance of the software, they can amortize infrastructure-related costs over thousands of customers. This results in substantial economies of scale and skill, reducing the total cost of ownership (TCO) for customers that deploy business solutions, and represents a compelling alternative to traditional on-premises solutions.
  • Rising adoption and functionality of mobile devices:SMBs have been adopting mobile solutions at a fast and furious pace. SMB Group research indicates 67% of SMBs now view mobile solutions and services as critical to their businesses. 83% have already deployed mobile apps to help improve employee productivity. However, easy-to-use mobile file-sharing and collaboration solutions failed to keep pace with this explosion until solutions such as Dropbox, Box and Google Drive became available. SMBs will be looking for easy-to-deploy, cost-effective file-sharing and collaboration solutions to get more value from their mobile investments.
  • Explosion of content and data: The volume of data continues to grow at a very rapid rate as SMBs increase their use of data-rich applications and access these applications and content from multiple connected devices. According to a McKinsey & Company report, the amount of global data generated per year is projected to grow 40% versus 5% growth in global IT spending; 30 billion pieces of content are shared on Facebook every month; and 5 billion mobile phones were in use in 2010. This is creating increasing demand for cost-efficient and scalable online storage and content management solutions because SMBs don’t have resources to implement and manage this magnitude of growth with their meager internal IT resources.
  • Increase in information-driven decision making:Data use increasingly will become a key basis of competition and growth for individual SMB companies. SMBs will leverage data-driven strategies to innovate, compete and capture value from information, creating increasing numbers of “knowledge workers” who need to create and access information on a regular basis both from the office and remotely.
  • Limited or no IT resources: SMBs lack the dedicated IT resources of larger enterprises (Figure 2). Most SMBs have limited IT resources, and the resources they do have are fully deployed to keep the IT infrastructure and endpoints up and running. Consequently, they do not have bandwidth to adequately implement and provide ongoing support for on-premises solutions—prompting SMBs to adopt high-quality and high-availability cloud-based solutions.

Small and medium businesses (SMBs) are rapidly adopting OFSC solutions to give employees powerful and capable collaboration solutions without the hassles of traditional on-premises collaboration and file sharing alternatives. However, since the functionality of different vendor OFSC offerings varies significantly, SMBs should thoroughly examine their options to see which solutions are best suited to their current and future needs.

The SMB Group recently published a report Online File Sharing and Collaboration: The SMB Market Opportunity. This report examines the key drivers prompting SMBs to adopt cloud-based OFSC solutions; provides market opportunity and revenue forecast from 2014-2020 for these solutions; and detailed information about the top OFSC vendors in the SMB market (AirWatch Secure Content Locker, Box, Citrix ShareFile, Dropbox, Egnyte, Google Drive, Hightail, IBM Connections, Microsoft OneDrive, Salesforce Files). The report concludes with our recommendations for both vendors that offer OFSC solutions, and for SMB customers that are evaluating them.

October 31, 2012

SAP TechEd 2012: Implications for SMEs and the Partner Ecosystem

Filed under: Blogs - Sanjeev Aggarwal, Cloud Computing, ISV, Mobility, SaaS, Sanjeev Aggarwal Blog, SAP — Tags: , , , , — sanjeevaggarwal @ 12:10 pm

Sanjeev Aggarwal, Partner, SMB Group

During the week of October 15, I attended SAP TechEd 2012 in Las Vegas, along with about 6,500 SAP technology specialists and partners, and a small group of influencers. Although SAP is more widely renowned for its success in the large enterprise market, the small and medium enterprise or SME market (which SMB Group labels the small and medium business or SMB market) is a core part of SAP’s installed base and essential to SAP’s growth strategy. Roughly 80% of SAP’s more than 128,000 current customers are SMEs with less than 1,000 employees. In addition, SAP has more than 12,000 partners worldwide who provide SAP solutions and services to SME customers.

During this year’s TechEd, SAP discussed three areas that underscore SAP’s commitment to the SME market and its fundamental belief that strong growth opportunities lie ahead in this segment.

Taking HANA to the Cloud and to SMEs

  • HANA Cloud was by far the lead theme overall at 2012 TechEd. As Bill McDermott, co-CEO remarked, “HANA lies at the heart of the intellectual renewal going on at SAP.” HANA began life as an in-memory analytics engine, and quickly evolved into a database. Now, as SAP announced at the event, SAP is building the HANA Cloud as a next-generation platform for developers.

    SAP HANA AppServices and SAP HANA DatabaseServices are services that allow developers to create next-generation applications using native SAP HANA, Java and other rapid-development services. The good news is that SAP will now offer for free, developer licenses for SAP NetWeaver Cloud to get more support from the developer community. These shared services will build on SAP’s cloud platform vision by providing building blocks for portals, integration, mobile, analytics, collaboration and commercial services required to expedite building and life-cycle management of applications.

    SAP HANA One, a deployment of SAP HANA on the Amazon Web Services Cloud. HANA One currently supports a relatively small 64GB HANA instance on Amazon’s AWS cloud for $0.99 per hour. This will make it faster and easier and cheaper for developers to build affordable, HANA-enabled apps for SMEs.Although HANA Cloud is still a work in progress, HANA Cloud services and SAP HANA One are first steps to SAP realizing the HANA Cloud development platform vision. Significant work is required to move this from a development/testing proof-of-concept to a production platform where commercial applications can be deployed. SAP needs to develop a strategy to help developers move rapidly to commercial deployment and promotion, as Salesforce.com has done successfully with its Force.com platform and ecosystem.

  • SAP also announced that SAP Business One, version for SAP HANA, has been in limited release mode as of September 18, 2012, with general availability slated for some time next year.

    SAP Business One is SAP’s flagship ERP solution for SMEs with fewer than 100 employees. This HANA-powered version uses the HANA database and allows both the transactional (ERP) and analytical application to be run on the same server, and promises significant performance advantages. Running both ERP transactions and analytics on a single platform speeds access to information for analytics, reporting and search, without slowing down transactional processing.

    While not every SME will need to turbo-charge these functions, some SMEs are challenged with exponential data growth, and managing and extracting the insights they need from it. For instance in the health care industry, companies can integrate patient transactions with insurance company patient utilization records and hospital electronic medical records, to providing a complete real-time view to better manage patient care and costs. By crunching through more data more quickly, these businesses can more readily gain the insights they need to succeed in an increasingly complex and competitive world.
    Meanwhile, SMEs that don’t require the increased speed and power and analytics capabilities that HANA supplies can continue to buy SAP Business One based on Microsoft SQL database, which SAP offers as both an on-premises and cloud based solution.

Enabling Mobility for SMEs

With the acquisition of Sybase and Syclo (which SAP acquired in April’12), SAP is moving to help SMEs develop a mobile application and mobile management strategies. Sybase’s robust, market-proven Sybase Unwired Platform, is now augmented by the Syclo mobile application development platform to enable partners to rapidly develop, configure and deploy mobile apps for SME customers. SAP partners can also help SMEs to add mobile capabilities to their existing business applications, and/or help them develop custom mobile applications to address business requirements. SMB Group research studies indicate that many SMEs are planning to deploy internal mobile solutions in areas such as field service and CRM. In addition, they are planning to provide external mobile apps in areas such as payments, marketing and appointment and reservation scheduling to boost customer engagement and create new revenue opportunities.

Empowering the SME Partner Ecosystem

The partner ecosystem heavily influences SMEs’ business solution purchase decisions. Many of the partners I spoke with at the event provide consulting, implementation services and development for SAP’s SME-focused applications, including Business One, Business by Design, Business All-in-One, Business Objects Edge. Now SAP is helping these partners build skills in HANA and mobility to support new SME requirements.

Partners will play a vital role in helping SMEs customize application, analytics and reporting on the HANA platform or help startups develop new next generation application on SAP HANA Cloud. Likewise, on the mobility front, partners are essential to help SMEs develop a comprehensive mobility strategy that includes mobile access to business application and address the mobile management issues–including devices, access, security and mobile applications –in a unified way.

SAP is sparking renewed interest from and incremental opportunities for the SAP partner ecosystem. HANA Cloud, SAP Business One with analytics powered by HANA, and new mobility solutions will help SAP attract new partners and grow its partner ecosystem. Meanwhile, SAP’s laser focus on the mobility front will help it forge new partnerships with mobile solution developers that want to capitalize on the opportunity to provide mobile solutions via SAP’s Sybase Afaria platform. SAP is also opening up the SAP PartnerEdge program to help attract these new partners with educational tools, resources and training–as well as credentials to validate and certify partner skills for mobility and HANA.

In addition, the current SAP Mentors and partners that I met at TechEd were excited about the new opportunities that this will open up for them. For existing SAP partners, SAP’s new HANA and mobile solutions provides a pathway to incremental opportunities in their existing account, and an entrée to develop business in new ones.

Perspective

SAP is betting that these new technologies and solutions will give it an edge in the SME market. But for many SMEs, this is uncharted territory. SAP will need to make a hefty investment—particularly around HANA—to build awareness and understanding of the value that it brings to the table. Likewise, it must build on TechEd to ensure that it rolls out a steady, effective training program to help partners position, design, build, implement and support SAP solutions in these areas.

That said, as discussed in The Progressive SMB: Customer Stories are Worth 1,000 Analyst Words, SMB Group research indicates a distinct and growing segment of SMEs that we call “Progressive SMBs.” Despite economic uncertainties, Progressive SMBs plan to increase IT investments. They see IT as a tool for business transformation, and a way to create market advantage and level the playing field against bigger companies. Furthermore, Progressive SMBs have higher revenues expectations than their peers.

For instance, 50% of the small and 73% of the medium Progressive businesses (who are increasing technology spending) anticipate revenue gains in 2012, compared to just 15% of the small and 8% of medium businesses that plan to decrease IT spending.

The opportunity for SAP lies in growing the Progressive SME segment. After all, its unlikely that SME technology stragglers are going to become SAP customers. To accomplish this, SAP will need to make a significant investment outside of its installed base (as well as within) to educate SMEs about the increasingly dire consequences that technology laggards are likely to face, and the tremendous upside that they can gain by using IT solutions more strategically. Then, SAP must clearly connect the dots to demonstrate how SMEs can apply its new solutions to leapfrog competitors and grow their businesses.

If SAP can alert and educate a broader SME audience, then it can not only help narrow this gap, but also increase the market opportunity for its new solutions.

June 10, 2012

NetSuite SuiteCommerce: Transforming Commerce Solutions and User Experience

 Last week I had the opportunity to attend NetSuite

SuiteWorld 2102 in San Francisco. One of the most notable announcements was the launch of NetSuite’s new SuiteCommerce Commerce-as-a-Service (CaaS) platform for B2B and B2C businesses.

The SuiteCommerce offering is designed for e-tailers, retailers and other companies that sell online and provides these businesses with multi-channel platform which is integrated with NetSuite’s core ERP system. This gives companies a unified front-end to manage their various digital sites and brick-and-mortar stores, connected to their ERP to provide a single system of record for history of customers across channels. According to NetSuite, SuiteCommerce will help businesses to:

  • More easily customize web page content and integrate information into back-end financial systems
  • Tailor eCommerce solutions to the requirements of mobile, machine-to-machine (M2M) and social networking platforms
  • Enhanced social networking solutions through integrations that augment the platform with social functionality such as social ratings, reviews, personalized product recommendations and conversations

NetSuite will offer two SuiteCommerce options:

  • The Mid-market version targets businesses with smaller product catalog of products and services. The Mid-market suite starts at $1,999 per month and is available now.
  • The Enterprise version is aimed at larger companies and is designed to handle a more extensive product catalog of products and services. The Enterprise version at $3,999 per month and will be available in August 2012.

The vendor also announced a roster of SuiteCommerce partners, including Square, Stripe, Acquia, Bazaarvoice, MyBuys, Velaro and Shotfarm that have developed apps that integrate with the platform. In addition, it announced partnerships with the creative agencies that can help companies design their sites to optimize SuiteCommerce capabilities. These partners, agencies and VARs can extend the SuiteCommerce platform using NetSuite’s SuiteCloud development platforms and SuiteApps.

Perspective

The timing of this announcement couldn’t be better.

Technology trends are converging to create a perfect storm in the world of commerce—one that empowers customers and raises the bar for companies to meet new, more demanding customer expectations. Social media empowers customers with information from friends and other unfiltered sources. Mobile devices are
facilitating this trend, making it possible to research and shop for products and services anytime and anywhere. Cloud computing and ecommerce are blurring the boundaries between brick-and-mortar and online commerce stores, creating an imperative for merchants to provide consistency and visibility across channels.

This has created an environment where customers expect more from businesses throughout the commerce cycle. They want anywhere, anytime, any-device access to multiple sources for information gathering, product and service evaluation, selection, purchasing and customer service. As a result, merchants need to anticipate what the customer wants, automate and personalize customer interactions, and enable the customer to do business where, when and how he or she wants.

NetSuite’s introduction of SuiteCommerce is designed to help businesses meet these elevated customer expectations. NetSuite has had an integrated eCommerce offering for years, an almost 2,800 of its customers run their web sites and storefronts on NetSuite. However, SuiteCommerce is intended to go beyond the commerce experience to integrate social, mobile and other customer touch points.

As NetSuite’s CEO Zach Nelson noted in his remarks at the event, “Over the past decade, NetSuite has transformed how our customers operate their businesses internally. Over the next decade, NetSuite will transform how businesses operate with other businesses and with their customers through NetSuite Commerce as a Service.”

In addition, SuiteCommerce strengthens NetSuite’s “one system of record” integrated suite story, which is a good one in the mid-market. SMB Group’s research finds that “integrating different applications” is a significant challenge (Figure 1).

Figure 1: Top Technology Challenges in Medium Businesses


Source: SMB Group 2011 SMB Routes to Market Study

The SuiteCommerce offering also aligns with the direction NetSuite announced at last year’s SuiteWorld event, when it unveiled plans to move up from its SMB lineage (that harkens back to its NetLedger days) to pursue the upper end of midsize business, a two-tier strategy in the large enterprise space, and select industry markets.

SMBs increasingly see that customer-facing mobile applications can help them grow revenue, attract and retain customers, and keep up with the competition. SMBs are using both mobile-friendly web sites and mobile apps to offer functionality to foster this interaction, as shown on Figure 2. Regardless of whether SMBs are employing a mobile-friendly web site, mobile apps, or both, what are the top capabilities that they are providing to external audiences? And what do they plan to add in the next 12 months?

Figure 2 Business Functions Available/Planned Via a Mobile-Friendly Web Site/Mobile App.


Source: SMB Group,
2012 Small and Medium Mobile Business Solutions Study

Mid-market businesses are increasingly enabling mobile apps to access line-of-business functions to conduct business with customers, prospects, partners and suppliers. Mobile support in SuiteCommerce will enable significant new revenue opportunities for NetSuite SuiteCommerce VARs and service providers.

Quick Take

The large number of customers and partners in attendance at SuiteWorld 2012 seemed excited about SuiteCommerce and NetSuite’s direction to help transform from the core internally-focused business application into an integrated, commerce-aware business platform. I talked to several NetSuite VARs at the event, most of them were very excited about the comprehensive easy-to-use solution multi-channel commerce solution.

NetSuite’s ability to get both developer and creative partners for the SuiteCommerce launch bodes well, as these are the applications and services that will bridge the last mile for many customers.

SuiteCommerce currently offers good mobile capabilities to mid-market businesses. However, SMBs increasingly see that customer-facing mobile applications can help them grow revenue, attract and retain customers, and keep up with the competition. NetSuite should look at developing some core mobile apps that integrate with SuiteSommerce, these apps can me customized by the VARs and offered to mid-market business providing significant competitive advantage to the SuiteCommerce platform.

There has been a significant rise in demand for social networking capabilities in mid-market businesses. On the social side NetSuite has already enabled the platform for social networking. Several of the social solutions partners help complete the solution to provide a comprehensive social solution.

One question that remains unanswered, however (although asked by analyst Brian Sommer and explored in NetSuite SuiteWorld Part 1: The Big Points | ZDNet), is how NetSuite will help companies crunch through, manage and make sense the massive amounts of new, external and transactional data that they will be bringing in. While big data, HANA, Hadoop and in memory databases are still fuzzy concepts for many, major players (IBM, Oracle, SAP, etc.) will get better at articulating what it means–and their solutions. And as NetSuite turns further upmarket, the pressure will build for it to have a solid and well-crafted big data strategy.

February 1, 2012

What Can We Learn From This Year’s Holiday Season?

—by Brent Leary, CRM Essentials

In conjunction with IBM’s Smarter Commerce initiative, the SMB Group and CRM Essentials are working on a series of posts discussing how technology is empowering today’s customer, and why companies have to change their approach in order to build strong relationships with them. This is the fourth post in the series.

Christmas 2011 is a great example of Smarter Commerce in action. It’s a lesson in why businesses need to transform the way they market and sell their products and services. According to the National Retail Federation, retail industry sales for the 2011 holiday season increased 4.1 percent year-over-year to $471.5 billion, beating its expectation of 3.8 percent growth. And while the overall numbers probably made for a pleasant holiday for the industry as a whole, what was happening online was astounding:

  • US online holiday shopping season reaches a record $37.2 billion, up 15 Percent vs. 2010 – a rate of increase almost 4X higher than the overall rate for retail.
  • A post-holiday 2011 retail study from Kabbage, Inc. focusing on small-to-medium online merchants found 69% of respondents reporting increased sales. On average, study participants experienced a 32% hike in sales compared to the 2010 season.
  • As late as one week before Christmas 2011, one-quarter of consumers hadn’t even started holiday shopping. (Consumer Reports)
  • 93% of retailers have offered free shipping at some point during the season vs. 85% last year. (USA Today)
  • The 2011 US Holiday Season edition of the ForeSee Results E-Retail Satisfaction Index of the top forty Internet retailers increased by a point from 78 to 79 (on a scale of 1-100)
  • Almost one in four retail searches online on Christmas Day were made using mobile phones or tablet devices, according to the British Retail Consortium (BRC).
  • The number of adults in the United States who own tablets and e-readers nearly doubled from mid-December to early January, according to a new Pew Research study. (New York Times)

Technology’s Impact on Behavior Is Accelerating

The world is changing. While still a fraction of the overall sales figures, ecommerce is growing at a much faster rate than traditional retail. And not just for the big retailers. As the Kabbage study illustrates, small and midsize online retailers enjoyed tremendous growth as well. This in part stems from the effect technology is having on the customer buying process, and the ability of companies to adapt their business processes to support online shopping.

When you think about twenty-five percent of shoppers not starting their Christmas shopping until after December 18th, it really hits home how the process of shopping has changed. Five to ten years ago most people still were going to multiple stores in search of ideas for things to buy, to find recommendations, compare items, and to look for deals, so they had to start their shopping efforts earlier. Now they can do most of that online – with a lot less time involved. And from the online retailer’s perspective, they leverage the latest technology not only to provide this information to online shoppers, but also to deliver the goods on time as well. Jewelry specialist Blue Nile offered free FedEx shipping guaranteed to arrive by Saturday, December 24, for all orders placed as late as 7 p.m. the day before (Friday, December 23). And other online retailers offered similar shipping capabilities.

This all adds up to shoppers more efficiently finding what they want, knowing the price they want to pay and having the confidence of getting it in time – with the added benefit of not having to wrestle with issues like parking, crowded malls, weather etc.. And as both companies and consumers accelerate their technology adoption, look for ecommerce to steadily increase its portion of the retail pie while customers leverage social and mobile to decrease the time and effort it takes to buy things.

Technology’s Impact on Behavior is Dramatically Affecting Expectations

One of the more interesting developments is how technology is impacting customer expectations as well as their behavior. Now that companies like Amazon can get items to us in two days for free, we expect this kind of service all the time. And while 93% of them did offer free shipping at some point during the holiday season, a study also showed 73% of consumers recently surveyed by MarketLive named “free returns” as a top promotion in determining their online purchasing behavior.

This is a great example of customers understanding what technology can do, and expecting vendors to find ways to leverage it to continuously improve their shopping experience. And improving the experience is crucial to keeping customers satisfied. According to the ForeSee study, satisfaction scores are important because a one-point change in website satisfaction can predict a 14% change in revenues generated on the web. And when they were highly satisfied with a purchase:

  • 64% of survey responders said they were more likely to buy from the same company the next time they needed a similar product;
  • 67% were more inclined to recommend the company to others; and
  • 65% felt a sense of ‘brand commitment’.

This illustrates that investing in improving customers’ web experience is a terrific way to build brand loyalty and capture the benefits of viral marketing (or something like this).

A Christmas Carol…

You really don’t have to look much further than Christmas Day 2011 to see how technology has changed customer behaviors and expectations. Digital content & subscriptions (digital downloads of music, TV, movies, e-books and apps) accounted for more than 20 percent of sales on Christmas Day. On any other day of the holiday season, that number was only 2.8%. And these numbers were driven by the rise of mobile devices, with the iPad leading the way on Christmas Day with a staggering 7% of all online sales coming through just that one device – accounting for 50% of sales that day, according to the IBM Coremetrics Benchmark.

While the numbers tell the story, it really hits home personally when I saw my parents (both octogenarians) sitting at the kitchen table Christmas Day – my father with his iPad, and my mother with her Kindle Fire. And my mother, having received the Fire as a gift, was reading an ebook she purchased Christmas morning… with an Amazon gift card.

This is a totally different story of Christmas than Charles Dickens told in the 19th century, but it’s a tale of what to expect in the 21st century when it comes to customer engagement. Because of technology and its empowering effect on customers, they are developing “great expectations” their vendors must live up to. Which means vendors must be smarter in their approach to smarter, more informed customers.

This is the fourth of a six-part blog series by SMB Group and CRM Essentials that examines the evolution of the smarter customer and smarter commerce, and IBM’s Smarter Commerce solutions. In our next post, we’ll look at key points to consider when planning a smarter commerce strategy. In our next post, we’ll look at IBM’s Smarter Commerce offerings to help illustrate how midsize companies can reshape the way they do business to meet the expectations and needs of smarter customers.

December 28, 2011

2012 Top 10 SMB Technology Market Predictions

Here are the SMB Group’s Top 10 SMB Technology Predictions for 2012! A more detailed description of each follows below.

  1. Economic Anxiety Lowers SMB Revenue Expectations and Tightens Tech Wallets
  2. The SMB Progressive Class Gains Ground
  3. The SMB Social Media Divide Grows
  4. Cloud Becomes the New Normal
  5. Mobile Application Use Extends Beyond Email to Business Applications
  6. Increased SMB Business Intelligence (BI) and Analytics Investments Are Sparked by the Social-Mobile-Cloud Triumvirate
  7. Managed Services Meet Mobile
  8. The Accidental Entrepreneur Spikes Demand for No-Employee Small Business Solutions
  9. Increased Adoption of Collaboration and Communication Services in Integrated Suites
  10. The IT Channel Continues to Shape-Shift

2012 Top 10 SMB Technology Market Predictions in Detail

  1. Economic Anxiety Lowers SMB Revenue Expectations and Tightens Tech Wallets. After the Great Recession officially      ended in 2009, the U.S. economy resumed moderate economic growth in 2010—and the SMB outlook for 2011 became fairly bullish. But new economic worries and uncertainties are dampening some SMB outlook. Our 2011 SMB Routes to Market Study indicated that SMBs are less confident about their revenue prospects for 2012: 56%  of small and 63% of medium businesses are forecasting revenue growth for  2012, compared to the 77% of both small and medium businesses that forecasted growth for 2011. And many SMBs are tightening their tech wallets: More are forecasting flat or decreased IT spending for 2012 compared to 2011. To loosen the purse strings, tech vendors must deliver a rock-solid case for how their solutions help address top SMB challenges—which are to attract new customers, grow revenues and maintain profitability. In addition to broadening subscription-based cloud solution options (which offload big upfront investments), more vendors will offer flexible, alternative financing to help ease the financial burden—and gain a leg up on competitors.
  1. The SMB Progressive Class Gains Ground. That said, we also see a distinct category of SMBs that we are terming      “Progressive SMBs.” Despite economic uncertainties, Progressive SMBs plan to increase IT spending. These SMBs see technology as a vital tool for business transformation, a mechanism to create market advantage and a way to level the playing field against bigger companies. Although price is still a key factor for Progressive SMBs, they are more likely to rate other factors—such as easier to customize for my business, strong reputation and brand, and ability to provide local service and support—higher than other SMBs when making technology decisions, according to our 2011 SMB Routes to Market Study. Progressive SMBs invest more in technology and see the results in terms of higher revenue expectations. For instance, 73% of medium businesses that are investing more in technology anticipate revenue increases in 2012, compared to just 17% among those decreasing IT spending. Technology      vendors need to develop different marketing campaigns and more sophisticated solutions for Progressive SMBs than for their counterparts to win in this very important segment.
  1. The SMB Social Media Divide Grows. SMB use      of social media is rising. According to our 2011 Impact of Social Business in Small and Medium Business Study, about 50% of SMBs already use social media, and another 25% plan to do so within the next 12 months. The study revealed that about half of SMBs take a strategic and structured approach with social media. These      “strategically social” companies use social media for more activities, use more channels and are more satisfied with the business results than the other half of SMBs that are still throwing spaghetti on the Facebook wall.  These more informal, ad hoc users say that they don’t have enough time to use social media effectively; they can’t decide what social media strategies and tools will work best; it’s too difficult to integrate      social media with sales, marketing, service and other business processes; and they are unable to measure value from social media. As new social media tools—from crowd-sourced pricing to video commerce—take shape, SMB      social media “haves” will gain business ground on the “have-nots” in an exponential manner. As the have-nots lose ground, they will clamor for better social media guidance and easier-to-use, better integrated and more affordable social media management solutions.
  1. Cloud Becomes the New Normal. Is the      cloud perfect? No. Is it right for every solution and every business? No.  But that said, the rate and pace of technological change are in overdrive, and the need for businesses to harness new technology-based      solutions—social, mobile, analytics, etc.—to maintain a business edge is rising. Our 2011 SMB Routes to Market Study results      reveal that demand for cloud-based solutions is accelerating in almost all solution areas. For instance, in the past 24 months, only 7% of small businesses purchased or upgraded cloud accounting/ERP solutions, compared with 13% that plan to purchase them in the next 12 months. Areas that show the biggest potential for cloud gains in 2012 are marketing automation, business intelligence/analytics, and desktop virtualization solutions and services. Most SMBs simply don’t have the staff, expertise or capital budgets needed for do-it-yourself IT—and they can’t afford the time it takes to get business payback from a solution that they need to vet, buy,  install and deploy in-house. This makes the arguments for cloud computing—reduced capital costs, speed to deploy, and real-time collaboration and visibility—compelling. Demand for anytime, anywhere, any-device mobile access to applications will also accelerate cloud adoption, as many SMBs will want to offload management of mobile applications to a cloud solutions provider too. Enterprise players such as Oracle (with RightNow) and SAP (with SuccessFactors) have already begun their cloud shopping sprees. Look for traditional SMB vendors (Intuit, Microsoft, Sage, etc.) to join in the fun.
  1. Mobile Application Use Extends Beyond Email to Business Applications. In a custom study we completed this summer,  SMBs indicated that they plan to significantly increase spending on mobile devices and services in the next 12 months, with the highest jump in the 5-to-49–employee size band. The study revealed that with mobile use of collaboration apps (email, calendar, etc.) now mainstream, SMBs are  mobilizing business applications. Some of the strongest categories for SMB  current and planned mobile app use are mobile payments (52%), time management (59%), field service (59%), and customer information management (69%). This rapid uptake will also include more vertical apps that are a perfect fit for industry-specific needs, especially given the choice of both smart phone and tablet (read: iPad) form factors. Unfortunately, our crystal ball is cloudy when it comes to predicting if another vendor will be able to give Apple a run for its money in the business-use tablet market.
  1. Increased SMB Business Intelligence (BI) and Analytics Investments Are Sparked by the Social-Mobile-Cloud Triumvirate. According to our 2011 SMB Routes to Market Study, 16% of small and 29% of medium businesses purchased/upgraded a BI solution within the past 24 months, and 16% and 28%, respectively, plan to do so in the next 12 months. The social-mobile-cloud triumvirate will fuel new and increased SMB investments in this area as businesses try to plow through the growing data avalanche to get to the insights they need to grow their businesses. As SMBs try to get a better handle on customers’      and prospects’ opinions and influence networks, interest in sentiment analysis and social graphing solutions will grow. New mobile access capabilities and applications from BI vendors designed to provide SMBs with just the information they need, when and where they need it, will spur interest as well. Finally, our study indicated that roughly a third of SMBs use or plan to use cloud-based BI and analytics solutions. An expanding array of cloud options in this area will make it easier and more affordable for more SMBs to deploy these solutions.
  1. Managed Services Meet Mobile. Despite momentum toward the cloud, it will continue to be a hybrid world for a very long time. Many SMBs will continue to use existing on-premises apps  and choose on-premises deployment as security, regulatory or other needs dictate. So most SMBs will continue to grapple with IT infrastructure management—even as new mobile device management and governance challenges  grow. SMB adoption of mobile phones and tablets is now on par with that of traditional landline phones, according to our 2011 SMB Collaboration and Communication Study. With employees more likely to lose a smart phone than a laptop, security issues abound and will only increase. The “bring your own device” (BYOD) phenomenon creates additional concerns, not least of which is to create a firewall between personal and business data. These SMB challenges provide ample opportunity for wireless carriers, networking vendors, MSPs and others that can provide integrated and automated managed services. These are likely to include services that encompass management of cloud-based infrastructure and all end-point devices, from desktop PCs, tablets and smart phones to purpose-built mobile devices; network services to reduce downtime and help optimize the network that mobile access relies on; and support for cloud-based dual-persona solutions on personal mobile      devices.
  1. The Accidental Entrepreneur Spikes Demand for No-Employee Small Business Solutions. As unemployment has increased, so has the number of freelancers, contractors, independent consultants and others choosing to go it alone. According to      the U.S. Census Bureau, small businesses without a payroll make up more than 70% of America’s 27 million companies, with annual sales of $887 billion. Many entrepreneurs never intended to take this path, but stay solo because they prefer it to going back to the corporate payroll. Others      stick it out due to limited employment options. Either way, more accidental entrepreneurs view what they’re doing as a long-term business venture instead of a short-term stopgap. As a result, they see themselves more as business owners than as freelancers or contractors. But many have no intention or desire to hire employees. This will spike demand for—and growth of—applications and services that help them to achieve their business goals without adding employees. Traditional small business powerhouses (Intuit, Sage, etc.), pioneers in the SOHO space (FreshBooks,      Shoebox, Zoho, etc.), new start-ups and others will increasingly cater to their needs with solutions that make it easier for them to fly solo—whether from a home office or on the go.
  1. Increased Adoption of Collaboration and Communication Services in Integrated Suites. As evidenced in our 2011 SMB Collaboration and Communication Study, the SMB pendulum is swinging from point solutions for voice, communications, social media and collaboration solutions to integrated suites. Medium      businesses are leading the charge, with 28% currently using an integrated collaboration suite, and 35% planning to do so in the next 12 months. Small businesses are slower to make this leap, but a transition is under way here too. By moving from disparate point solutions to an integrated offering, SMBs can avoid the hassles of learning to use multiple user interfaces, going to different sites to login and remembering different passwords—in short, things that waste time and frustrate users. They also can lower costs and improve their ability to collaborate effectively. A  growing roster of low-cost (or free), easy-to-use integrated collaboration suites (Google Apps, Microsoft Office 365, IBM LotusLive and HyperOffice, to name a few) are adding fuel to the convergence fire—although vendors will still need to address the obstacle of user resistance to learning  something new.
  2. The IT Channel Continues to Shape-Shift. The trend triumvirate—cloud, social and mobile—is also reshaping the IT channel. These trends are moving the goal posts and changing the ways in which channel partners add value. Cloud computing reduces the need for hardware, software and infrastructure deployment skills, and ups the ante for educational guidance, business process transformation and integration skills. Re-imagined channel partner programs from vendors such as Intacct and IBM’s Software Group have blossomed as they shift partner rewards to focus more on value-add and renewals. Meanwhile, non-traditional IT partners, such as creative and marketing agencies, have stepped in to fill a gap by providing social media and digital marketing services for solutions such as Radian6 and HubSpot. In the mobile domain, partners will need to bring more value to help SMBs develop and implement mobile strategies, and offer solutions to manage mobile devices and applications and provide better network performance, reliability and redundancy. As with any significant inflection point, the cloud-social-mobile trend necessitates that older partner models continue to move aside as new, more relevant ones take shape.

May 17, 2011

Pervasive Puts Its Galaxy Integration Community Into Orbit

–by Sanjeev Aggarwal and Laurie McCabe, SMB Group

Pervasive announced Pervasive Galaxy at its annual Metamorphosis conference earlier this month. Galaxy merges an online integration marketplace and community into a single, streamlined platform. Pervasive has designed Galaxy to make remove boundaries between buyers and sellers and make it easier for end-user customers to understand options, review vendors, figure out what’s best for their needs, and shop for and purchase integration solutions. Galaxy’s built-in community capabilities help vendors connect with customers to gain input, gather feedback, exchange ideas and help crowdsource new solutions.

As we noted in our SMB Group Top Ten 2011 SMB Predictions, better, faster integration is becoming a critical business solutions differentiator. Cloud computing has made business solutions more accessible and affordable for a wider swath of companies, but integrating them can often break the bank. This is especially the case for SMBs, who usually don’t have the money or appetite for complex or time-consuming integrations.

This reality drove IBM to acquire Cast Iron earlier this year, and Dell’s recent purchase of Boomi. Now Pervasive, a long-time leader in the integration space, has sent Galaxy into orbit on the heels of some very big players making significant acquisitions in the integration space.

Here’s a quick synopsis of the announcement, and our take on what it means for the integration market and the stakeholders in it.

The Integration Challenge

Integration is one of the biggest and costly hurdles for companies that need to adopt new applications. Companies need to integrate applications and data sources to maximize productivity, reduce redundancy and inaccuracies, and streamline workflows. Yet integration between and among cloud and on-premise applications, different data sources and existing business workflows can be costly and complicated. This is especially true for SMBs, who don’t have IT staff that can develop integration between applications, or the budgets for solutions that require time and labor services.

How Galaxy Addresses the Integration Challenge

With Galaxy, Pervasive is creating a place where customers can easily identify and access affordable and capable integration solutions and vendors, and also provide vendors with feedback about their integration requirements. Galaxy will offer data integration products, solutions, connectors, plug-ins and templates, and serve as a community platform for customers, developers, integrators and other relevant vendors. Pervasive’s intent is that this convergence will nurture a strong ecosystem that will facilitate more rapid, innovative and accessible integration solutions.

Vendors on Galaxy will offer customers both integration components and turnkey cloud integration services. For instance, integration components available in Galaxy include engines, workflows, connectors, agents and rich data services that can support a range of needs, such as data loading, data matching, profiling, transformation and business analytics. It will also offer ready to run solutions for point-to-point solution integration in a subscription-based SaaS model.

How Galaxy Works for Customers

Galaxy enables community participants to build, preview and test, buy integration solutions. These might include pre-built data integration solutions, connectors, plug-ins or templates that enable faster integration solution development.

Instead of starting with a Google search, or contacting a VAR or consultant, and trying to figure out if there is an existing integration solution that’s right for their needs, customers can go to Galaxy and see if there’s an existing solution that fits the bill. They can also use Galaxy to locate a partner than can customize an available integration to their individual needs, or build a custom solution from scratch.

Building an integration community is Galaxy’s other primary focal point. End users will not only be able to shop for ready-made solutions on Galaxy, but will also be able to view and provide ratings on the templates, connectors, plug-ins and solutions in it. They can use Galaxy to inform developers and integrators about their needs, request new integrations, and link to others with similar needs to share the costs of getting a new integration developed. End-users who build integrations themselves can, if they want, also sell them to others via the Galaxy platform.

How Galaxy Works for Partners

Pervasive Galaxy offers developer and system integrator (SI) partners an integration marketplace platform, development tools, integration store, community collaboration and revenue sharing–basically everything they need to build and sell their integration solutions. There is no charge to build an integration on Galaxy. Once partners build the solution and start selling it on the platform, they keep 70% of the sale and the other 30% goes to Pervasive. Partners retain the intellectual property of the integration, and can offer documentation and the required technical support (possibly for an additional fee).

Partners should be able to use Galaxy to help get their integrations to market more quickly, and make their offerings more accessible to a broader market. For instance, Galaxy’s try and buy program gives developers a way to demonstrate ROI before they buy–giving skittish and/or cash-strapped SMBs a risk-free way to try the integration and see if it pays off before they have to spend money for it.

In addition, partners can take advantage of Galaxy’s community to tap into the integration requirements across a range of businesses. This should enable them to tune their integration solutions more closely to actual requirements and meet market needs in a more repeatable and profitable manner.

What Does Galaxy Do for Pervasive?

Pervasive has initiated, built and will maintain and manage the Galaxy marketplace platform. Galaxy gives Pervasive a centralized mechanism to market and provide access to its growing array of development and testing tools–including Pervasive Data Integrator, Pervasive DataCloud, Pervasive Data Profiler in a more streamlined way to developers and integrators–and build a new revenue stream based on the sales of the integrations that partners build and sell.

As the community grows, Pervasive should also be able to extract a lot of insight about customer and partner integration requirements and demands across different horizontal, vertical and geographic markets, which it can use in its own product planning efforts.

Pervasive and its community members will jointly deveop and participate in demand generation and building visibility for the Galaxy market, vendors and community.

At some point, Galaxy could serve as a launch pad for integration testing and certification, conducted either by Pervasive or possibly by the community, helping to reinforce Pervasive’s position as a leader in the integration space.

Quick Take

The integration challenge is becoming increasingly more complex because of trends such as cloud computing, mobile solutions, social media and the exponential growth of data. These trends will continue to drive the need for companies to integrate more applications and data from an increasingly dizzying array of sources.

These trends are also driving Pervasive and its integration competitors to tear down some of the barriers that have made integration so difficult in the past (see Dell and Boomi: Doubling Down on Integration, for our view on Dell’s approach to this challenge).

With Galaxy, Pervasive has built a streamlined, in-context ecosystem for customers to search for, identify, evaluate and purchase integration solutions. As important, Galaxy gives users a place where they can voice their integration experiences, concerns and requirements. Meanwhile, Galaxy should help partners market their solutions, and gain insight on integration gaps and requirements from a much broader audience, and amortize the costs of developing their integrations over a larger number of customers. The ecosystem approach puts vendors and customers on the same page and fosters the collaboration that should result in a win-win.

However, while Pervasive has built Galaxy, the question remains, will enough users and partners come to make it a true integration destination point? To fuel customer interest, Galaxy needs a strong cadre of actively engaged developers, SIs, and integrations in its ecosystem. Conversely, to attract partners, it needs a lot of customers that partners can sell their services to. Pervasive will need to double down on its social media, marketing, partner engagement and other related activities to ensure Galaxy reaches its goals–especially as it faces strong competition from the big guys–in our opinion, particularly from Dell-Boomi, which appears to be thriving under the Dell umbrella.

But, Pervasive’s smaller, independent status, can also play in its favor, as noted in Top Takeaways from Pervasive’s 2010 IntegratioNext Conference. It can keep a laser-like focus on the integration needs of customers and the business development needs of partners. And its independent status may appeal to prospective partners that may having differing agendas than, or encounter red-tape challenges when working with Pervasive’s larger rivals. If Pervasive can use this agility and focus to its full advantage, and rev up marketing and social media engagement, Galaxy should succeed in it mission to create a vibrant integration marketplace.

April 16, 2010

Highlights from Iron Mountain Digital 2.0 Industry Analyst Meeting

Highlights: The overall annual growth in data volumes is beings driven by an increase in unstructured data created by social media and collaboration solutions, mobile solutions and rich media which is leading to much higher costs for information storage and management. This problem is further exasperated as the information creation moves from customer on-premises sources, to now include mobile edge devices and the cloud. SMBs and mid-market enterprises now need to take a much more holistic approach to information management. Driven by the need to support compliance, litigation, business continuity and disaster recovery requirements – SMBs need to carefully consider who they partner with as their trusted guardian of their information considering their need to store, protect, manage and retrieve this information in a virtual world anytime, anywhere, and anyplace.

Quick Take: I’ve been following Iron Mountain for a while, and this was their 3rd. analyst event that I attended. Everyone recognizes Salesforce.com as a cloud solution market leader; I would venture to say that the 2nd biggest cloud solution and services provider is Iron Mountain Digital. Key insights from the conference are:

  • Shift in company focus from Storage-as-a-Service to ‘Integrated Information Management Solutions‘ that is based on a location agnostic strategy – from on-premise to edge to cloud

  • Key Value Propositions to address the customers Total Cost of Ownership/Total Cost of Management of Information include:
    • Help customers reduce their spend and risk in owning / storing their rapidly growing information through policy-based intelligent information storage and access
    • Help customers improve operational efficiencies and reduce their spend in managing their information for use
    • Trusted partner in information management for both physical and electronic records and information, and in bridging from one to the other in terms of document conversion, data restoration, scanning, etc. 

What makes Iron Mountain different?

  • Information management platform with intelligence-driven and policy-enabled applications. This has been enabled through internal development and innovation (Digital Record Center for Compliant Messaging, for example), partnering (Total Email Management Suite, powered by Mimecast), and a carefully crafted acquisition strategy that started with Connected® and LiveVault® for backup to recent acquisitions that include Stratify® for eDiscovery and Mimosa for archiving.
  • Unique capabilities
    to “look into” and “look across” information
    . This will help with categorization of data – even at the point of creation – to enable intelligent access, compliance (including risk management), discovery, recovery, destruction and other potential use cases

  • Trusted partner who is financially strong. There are several companies offering remote backup solutions, and hosted email archiving, including you local VAR. But will these companies be around when you need the information 10-20 years from now for compliance purposes or to support litigation?
     What is still missing? Iron Mountain is accumulating a good war chest for location-agnostic information management solutions. They do have global relationships with large enterprise and upper mid-market companies – developed as the dominant leader in the physical information management services business that includes the storage of paper documents and magnetic tape storage media for backup and archiving purposes. They serve the SMB market through some core services, through direct and indirect channels. However, in my opinion, there is a larger opportunity in the SMB and core mid-market that includes:

    • Backup and archiving to support daily operations for desktops, servers and mobile devices
    • Backup and archiving to support business continuity and disaster recovery
    • Information management to support risk and compliance management
    • Virtualization of servers and desktops, and cloud computing is creating new and unique information creation and management opportunities which need to be addressed. The vendors that address these solutions (on public clouds based solutions) will be in the unique position to provide the services that Iron Mountain Digital 2.0 is seeking to provide. 

The first mover vendors will gain tremendous benefits, as these solution partnerships are now easy to replace – Iron Mountain can attest to this with their decade-long relationships with a large percentage of their customers. Iron Mountain needs to craft an SMB and core mid-market strategy with a more aggressive go-to-market plan than what I see at present.


 

January 20, 2010

Intuit and Microsoft – two SMB market leaders partnering on cloud platform strategies to deliver web applications

This agreement provides an end-to-end applications development environment and marketing/sales channels for application developers to develop and market application solutions to small businesses. Key elements of the agreement include:

  • Broadening the applications developer community to develop SMB focused applicationsIntuit to provide a SDK to help developers build applications on Microsoft Windows Azure Platform (and Visual Studio) and federate these web applications into Intuit Partner Platform (IPP) and launch these applications through the Intuit App Center (IAC).
  • Expand channel for application developers to promote and market their applications – Business Productivity Online Suite into Intuit Partner Platform (IPP) by year-end – Salesforce.com’s Force.com PaaS platform. Microsoft and Intuit will join forces to expand channels for application developers by introducing them to IAC. With capabilities to buy and access these cloud-based applications from the IAC and support for single sign-on will make it easier for SMBs to use these applications.
  • Microsoft to integrate Microsoft Business Productivity Online Standard Suite (BPOS) is a set of messaging and collaboration solutions hosted by Microsoft, and consists of Exchange Online, SharePoint Online, Office Live Meeting, and Office Communications Online. SMBs that use BPOS will have access to Intuit’s SMB focused business applications like QuickBooks and additional applications available through the IAC.

This relationship is focused on the U.S., the region where Intuit has majority of its presence. Microsoft and Intuit will support joint marketing programs targeted at the applications developers, channels and SMB companies.

In today’s fast-paced and volatile business climate, SMB need cloud-based application as they provide much better total cost of ownership (TCO) compared to on-premise installed applications. This relationship will provide significant benefits to SMBs that have shown increasing appetite to adopt cloud based solutions. The key benefits to the SMB community from this relationship are:

  • For Microsoft Windows Azure cloud platform service (PaaS), the Intuit relationship is a key endorsement of Microsoft as a key player in the SMB segment and of a company that has a good understanding of how to work with application developers. This combination will provide good competition to the
  • With Microsoft withdrawing from the small business accounting application area, creates a much more favorable partnership environment between the two companies to collaborate on the applications and channels front. A cooperative relationship between these two SMB focused companies will yield tremendous benefits to the SMB community.
  • With more than four million Intuit’s QuickBooks customers, the Inuit App Center will present a very attractive opportunity for applications developers to showcase their applications to the QuickBooks user community.
Older Posts »

Blog at WordPress.com.