Monday, February 08, 2010
SaaS Trumps Social Media
Posted by Mike Dubrall at 1:48pm
Managing Director Gilwell Group
With all the hype surrounding social media, it’s easy to overlook the impact of the Software as a Service (SaaS) model that has enabled the social media phenomenon. (Certainly, fewer people would be using Twitter if they had to purchase it and load it onto their computer.) And while 2010 is going to be the year of social media enablement for resellers, the next decade is going to be about adapting business models and channel programs to support the sale of services rather than products.
There is little debate that a significant percentage of channel revenue is going to shift to the SaaS delivery model (potentially through online communities). The only real discussion is about how fast this will happen and how high the SaaS revenue percentage will be in 2020. Recently, the ISV World conference in Germany asked me to talk this subject, so we pulled out some cameras and shot three videos about the SaaS market. Joining me is SaaS expert Ken Boasso.
If you don’t have time to watch all the videos (about 30 minutes), let me net it out for you. SaaS is already big and its going to get bigger. A different channel business model is required, one that can deal with thousands of new users/subscriptions a month. Social Media is a key enabler for SaaS because it enables low cost and effective marketing and sales capabilities. The resellers of today are not ready for any of this and will be looking to their vendors for leadership. Some traditional vendors are going to push their resellers into bankruptcy by pressuring them to sell products rather than Cloud services. The old channel is going to have to make some tough choices very soon. A new channel is going to emerge to specialize in selling Cloud services and not hardware or software products.
The biggest issue in marketing is trying to understand the new channel for selling SaaS (Cloud) services. IMHO, this issue is more important than social media, but we can’t get around to addressing it until channel executives are familiar enough with SaaS that they can make good planning assumptions. And that is why social media is critical. It gives everyone “hands-on” experience and a glimpse of how channels of the future are going to look.
Social Media changes (and levels) the playing field for marketing, communications, and customer intimacy. New strategies for reseller success are needed. SaaS changes the entire game and will require a new league to be created. Are you ready for all of this?
Mike Dubrall is Managing Director of Gilwell Group, a consulting company that specializes in “channel social media enablement." (Next program for resellers starts on February 18!) He is a regular blogger in the Integrated mar.com Partner Manager Community. Contact him at http://xeesm.com/mikedubrall
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