motivate their channel partners to sell their solutions. Vendors will have to alter their compensation plan to incentivize their sales team, but the result will be far more worth the effort. For instance, if Dell Technologies wants to ship 1,000 devices to a business customer, it also can attach an entire suite of solutions such as endpoint protection or Office 365. This outcomebased sale encourages channel partners to assist with a vendor’s go-to market strategy. Digital marketplace ecosystem Building a digital marketplace ecosystem is essential to optimizing subscription and pay-per-use models. These marketplaces represent a powerful additional channel for the marketing and sales of products, creating new trading partners and reducing costs. It’s the future of B2B sales. Growth in software-as-a-service (SaaS) spending is predicted to give businesses an estimated 20 percent boost a year on top of other sales and marketing efforts. Investing in a SaaS platform gives the independent software vendor the ability to publish once and propagate into many marketplaces. Using a cloud marketplace platform provides technology to connect players in a vendor’s target audience and enables its digital transformation into the subscription economy. With easy access to a vendor’s core market, a cloud marketplace platform enables businesses to accelerate their time to revenue by managing subscriptions, the catalogs, order fulfillment and billing across multiple channels. Customers are offered roundthe-clock service and a more transparent shopping experience. They can compare prices and products in a single source and consolidate the payment process. Tech vendors can set themselves up in the right marketplaces, positioning themselves to remain competitive, generate higher and regular revenue, and benefit from larger margins as well as gaining flexibility. Room to grow A digital marketplace doesn’t have to conflict with classic channel sales or the marketplaces of giants including ASW, Azure and Google Cloud. Building an ecosystem allows tech vendors to customize their reach – both on marketplaces that target their core market and allowing them to be seen on the larger marketplaces. In addition, tech vendors are often dependent on the volume of products or software solutions sold and have more opportunities to increase sales in the shared ecosystem. With global product reach and access to attractive annual recurring revenue streams, it is important for tech vendors to join marketplaces that have a customer base that is core to their go-to market strategy, as well as being seen on a hyperscaler marketplace such as ASW. As tech vendors grow and expand into international markets, central management is required for all sales support and the addition of subsidiaries. Medium-sized vendors, in particular, are often not yet well positioned in terms of their international expansion. By selling solutions in a digital marketplace ecosystem, companies can be profitable and successful in different countries. Many complex tasks around legal requirements and guidelines of other countries are automated by the software infrastructure behind digital marketplaces, so that companies can focus on running their core businesses. Leveraging a cloud platform Businesses are consuming technology solutions and products like consumers shop for goods, with just a few clicks of a mouse. When implementing a subscription or pay-per-use model, tech vendors are recognizing the operational efficiency of adopting an ecosystem of partners. This community of developers can create custom add-ons to refine their products and make them more appealing to channel partners. These communities help identify new use cases to drive business and expand into new verticals and integrations. Partners can build their own multichannel marketplace and manage both their inventory catalog and that of thirdparty providers. This makes it easier for tech vendors to place their products where their customers already are shopping for solutions. Investing in subscription and pay-per-use models will set tech vendors on a smoother path forward. The automated management of subscription models allows seamless communications with partners and billing to be handled in the background, while providing accurate real-time insights into customers’ contracts, projects and profitability. At the same time, a cloud marketplace platform puts tech vendors where they need to be – connected to an ecosystem that allows businesses to leverage marketplaces filled with their target audience from vendors and distributors on to resellers. As with consumers, B2B buyers recognize the benefits of one-stop shopping to grow their businesses. o Jess Warrington is general manager, North America for Cloud Blue, a marketplace platform for everything-as-a-service solutions. Top Four Challenges to XaaS Provider Success High total cost of ownership 19% Low integration with existing software stack (ERP, CRM, RIM, etc.) 18% Rigid business practices (company culture) 16% Company has too many billing systems/systems of record 16% Source: SaaSPath 2022: Worldwide Banner Book, 2022 AT YOUR SERVICE: XaaS 12 CHANNELV ISION | JANUARY - FEBRUARY 2023
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