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Posts from the ‘Competitive analysis’ Category

Oct 31

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SaaS Adoption Accelerates, Goes Global in the Enterprise

In working with manufacturers and financial services firms over the last year, one point is becoming very clear: SaaS is gaining trust as a solid alternative for global deployments across the enterprise.  And this trend has been accelerating in the last six months.  One case in point is a 4,000 seat SaaS CRM deployment going live in Australia, Europe, and the U.S. by December of this year.

What’s noteworthy about this shift is that just eighteen months ago an Australian-based manufacturer was only considering SaaS for on-premises enhancement of their CRM system.  What changed?  The European and U.S. distribution and sales offices were on nearly 40 different CRM, quoting, proposal and pricing systems.  It was nearly impossible to track global opportunities.

Meanwhile business was booming in Australia and there were up-sell and cross-sell opportunities being missed in the U.S. and European-based headquarters of their prospects. The manufacturer  chose to move to a global SaaS CRM solution quickly.  Uniting all three divisions with a global sales strategy forced the consolidation of 40 different quoting, pricing and CRM systems in the U.S. alone.  What they lost in complexity they are looking to pick up in global customer sales.

Measuring Where SaaS Is Cannibalizing On-Premise Enterprise Applications

Gartner’s Market Trends: SaaS’s Varied Levels of Cannibalization to On-Premises Applications published: 29 October 2012 breaks out the percent of SaaS revenue for ten different enterprise application categories.  The greener the color the greater the adoption.  As was seen with the Australian manufacturer, CRM continues dominate this trend of SaaS cannibalizing on-premise enterprise applications.

Additional take-aways from this report include the following:

  • Perceived lower Total Cost of Ownership (TCO) continues to be the dominant reason enterprises are considering SaaS adoption, with 50% of respondents in 2012 mentioning this as the primary factor in their decision.
  • CRM is leading all other enterprise application areas in net new deployments according to the Gartner study, with the majority of on-premise replacements being in North America and Europe.
  • Gartner projects that by 2016 more than 50% of CRM software revenue will be delivered by SaaS.  As of 2011, 35% of CRM software was delivered on the SaaS platform.  Gartner expects to see SaaS-based CRM grow at three time the rate of on-premise applications.
  • 95% of Web analytics functions are delivered via the SaaS model  whereas only 40% of sales use cloud today according to the findings of this study.
  • The highest adoption rates of SaaS-based applications include sales, customer service, social CRM and marketing automation.
  • SaaS-based ERP will continued to be a small percentage of the total market, attaining 10% cannibalization by 2012.  Forrester has consistently said this is 13%, growing to 16% by 2015.
  • Office suites and digital content creation (DCC) will attain compound annual growth rates (CAGR) of 40.7% and a 32.2% respectively from 2011 through 2016. Gartner is making the assumption consumers and small businesses will continue be the major forces for Web-based office suites through 2013.
  • The four reasons why companies don’t choose SaaS include uncertainty if it is the right deployment option (36%), satisfaction with existing on-premise applications (30%), no further requirements (33%) and locked into their current solution with expensive contractual requirements (14%).

Bottom Line: Enterprises and their need to compete with greater accuracy and speed are driving the cannibalization of on-premise applications faster than many anticipated; enterprise software vendors need to step up and get in front of this if they are going to retain their greatest sources of revenue.

Source:  Market Trends: SaaS’s Varied Levels of Cannibalization to On-Premises Applications Published: 29 October 2012 written by Chad Eschinger, Joanne M. Correia, Yanna Dharmasthira, Tom Eid, Chris Pang, Dan Sommer, Hai Hong Swinehart and Laurie F. Wurster

Oct 18

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SaaS Is For Closers – How High Performance Sales Teams Use OnDemand Apps to Beat Competitors

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There are plenty of sales teams exceeding their sales quotas today.

Much of their success comes from the commitment their companies have to creating sales training systems that are delivered over SaaS platforms. From Proctor & Gamble, which has a state-of-the-art sales training system delivered entirely over the Web, to General Electric who also has an exceptional sales training program and many others, there are companies investing heavily in SaaS-based training platforms for their sales and distribution networks.  Many smaller software companies I have worked with use Force.com as the development platform to create their own sales and partner training systems entirely in-house as well.  This area of SaaS application development is proliferating today.  Here are several take-aways from the activity going on right now.

Take-Aways

Of the thirteen companies I know of who have created their own sales training system entirely on a SaaS platform within the last year, seven have met or exceeded their sales quotas in their latest fiscal year.  This is a 53% success rate.

What is going on is that the companies who beat their quotas launched their OnDemand training systems months before a major revenue event, including new product introductions and planned bundling campaigns.  The result was a major increase in sales efficiency due to the accelerated and focused training.

  • SaaS Training Systems Often Turn Into Competitive Analysis Hubs On Steroids. One enterprise software company is using Force.com as the platform of choice for creating an entire network of sites and portals on competitive analysis topics and projects.  This has turned into an online community that unifies direct and channel partner sales with knowledge.  It is very effective in distributing competitive pricing and strategy ideas on how to beat competitors on deals.
  • Putting Tribal Knowledge to Work Selling. Taking the knowledge inside a company that is learned over time and getting it included in an online training system is invaluable.  All companies in the 53% who are beating their quotas have done this.  Their training managers are experts at gleaning tribal knowledge out of the company and getting it into the online learning systems so sales can use it to sell.
  • Role-based learning that can be tailored to different selling scenarios is a must-have. This is what the Force.com platform does very well, it allows these companies, many of them in the B2B manufacturing arena, to create role-based learning paths and programs for their sales teams.  Each member of a team has to go through the online training and score at a sufficient level to get more leads and get out to customers.  The more they learn the more they earn.

Bottom line: Sales training is the secret weapon many companies are using to beat their competitors on deals today.  The ability to deliver training anytime, anywhere on a SaaS platform just strengthens a sales force even more.  Add in putting tribal knowledge to work and creating online competitive analysis hubs, and the competitive strengths of a company become even more formidable.