Thoughts on what businesses actually need from the Cloud, not what vendors wish they needed.

Chris Bliss

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SaaS Vendors Need To Figure The Channel Out Now

Dust Bowl - Dallas, South Dakota 1936

The Reseller Wasteland is no joke.

Referrals, Word of Mouth and Free Lunch Only Go So Far.
In the young and emerging SMB sector, many SaaS vendors are turning to referral marketing as a way to spread the word. This “you win, I win” model means User A recommends the application, User B signs up, both get a 10% discount. For many simple SaaS applications, this referral model works stunningly well. John O’Nolan’s entrepreneur blog had so much traffic when he blogged about Free Agent Central that he’s now able to use the software completely free of charge.This free lunch strategy is exactly the type of model that freelancers and blog addict community drivers need. Their readership are more than willing to kill a few hours demoing the next new thing so the strategy works.

The Need For Guidance, Consultation and Expertise Is Here

But for software aimed at larger companies, the multi-user and small business in the +5 person size, this doesn’t quite cut the mustard.  Small businesses really need at least one person to champion a solution, and that person has to be there every step of the way to make sure adoption is successful. Usually that falls on the directing manager or owner of the company. Unlike the budding young freelancer or weekend entrepreneur, this person doesn’t have the time to find new solutions.

And the responsibility for picking the right SaaS is far greater:  Will this application fit the team’s needs? How best to migrate information? What’s the cost over 3 years? How does integrating this affect our central information? Are we just building multiple data silos? Is it a problem that this SaaS vendor is 100% funded by VC crazies in Oakland who could care less about small businesses?

SaaS Vendors Can’t Get Into Bed With Their Customers

Unfortunately, the SaaS vendor cannot realistically answer these questions. What restaurant would, in their right mind, turn away hungry customers because their gut feeling was they wouldn’t like what was on the menu? SaaS vendors are in a very competitive market and they’ve got to claw and scratch for every paying seat. Count on them to provide great services and software, but not objective criticisms and recommendations.

As for the blogosphere and twitterverse, there just aren’t many private companies with developed blogs that can devote time to blog / review about every decision they make. Furthermore, businesses are all different and will have different criteria. Sifting through blog reviews and tweets is just as much of a hassle as sifting through software demos and free trials.

What’s An Emerging Channel To Do? Cloud Vanguards and Service Brokers Need Help Too

The opportunities are there, the clients are knocking on the door. SaaS vendors need to think long and hard about the role of the cloud vanguards and what we represent. In many ways, we are some sort of magical dream customer that is well informed, asks critical questions, wants to insure your success and brings you money. If you want to help us, think about what provides us with value to grow our businesses. We’re just as hungry as you are.

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Chris Bliss works at VM Associates, an end-user consultancy for businesses looking to move to the cloud from pre-existing legacy systems.