What Successful Partners are Doing to Build Profitable Cloud Businesses Microsoft Cloud Summit Fall 2014 Marilyn Carr Partnering and Alliances Research 2013 IDC Report It Can Be Done 2014 IDC Report How ID: 499079
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Successful Cloud Partners 2.0: What Successful Partners are Doing to Build Profitable Cloud Businesses
Microsoft Cloud Summit , Fall 2014
Marilyn Carr, Partnering and Alliances ResearchSlide2
2013 IDC Report – It Can Be Done 2014 IDC Report – How? WW Survey with over 700 respondents 20 in-depth interviews
2
http://aka.ms/idccloudebookSlide3
AgendaPlanning for your cloud businessCloud business strategies
Cloud sales strategies
Marketing for the cloud
Managing and measuringEssential guidance
© IDC Visit us at IDC.com and follow us on Twitter: @IDC
3Slide4
Successful Cloud Partner PracticesPlanning for Your Cloud Business
4Slide5
Planning for Your Cloud BusinessConsider Your Cloud Plan
You’re probably not behind… yet.
But you are losing deals to
Born in the Cloud and other partners
5Slide6
Planning for Your Cloud Business© IDC Visit us at IDC.com and follow us on Twitter: @IDC
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We have effective solutions where we serve business applications to mobile devices through SharePoint online or through Azure where SharePoint is a tenant. Then
we are exercising three Profit Pools at once with Cloud as our leverage point
.
Emily Lynch, VP Marketing, Catapult Systems
Understand your profit pools
What do
you make the most money on now?
What
impact could cloud have?Slide7
Planning for Your Cloud BusinessIs it time for a management
offsite?
Key decisions must come from the top
Helpful to get outside help to facilitate
7
Cloud has transformed our business but if you don’t have a plan
and you haven’t communicated it, how the heck are you going to get everybody there? Connor Callanan, CEO , CoreSlide8
Successful Cloud Partner PracticesYour Cloud Business Strategy
8Slide9
Your Cloud Business Strategy Build Your Recurring Revenue – The New Killer Metric
Offers
predictability, cash flow, and positive impact on company valuation
9
Like every ISV in the world
you want to be seen as a
SaaS company to Wall Street eventually.Brian Cook, Executive Chairman,
NintexSlide10
The Recurring Revenue Trough
10
Today
Past
Future
Revenue
Revenue Shift + Investment Slide11
Recurring Revenue: Long Term Appeal
11
Revenue from customers signed in year 1
Revenue from customers signed in year 2
Revenue from customers signed in year 3
Revenue from customers signed in year 5
Revenue from customers signed in year 4
Today
FutureSlide12
Recurring Revenue: Predictability
12
Past
Future
Revenue
Traditional Project Services Model
Cloud or Managed Services Model
Having
recurring revenue on a cloud service model has been gold for us because it
flattens out the peaks and valleys
of revenue
.
Jonathan
Voight
, CEO AgilitySlide13
Recurring Revenue: And not Or?
13
Today
Past
Future
RevenueSlide14
Your Cloud Business Strategy
Go Big Or Go Small. You Can’t Do Both
SMB = volume
Enterprise = depth
14Slide15
Your Cloud Business Strategy
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You May Not Have To Change Everything
Selling services to enterprise customers may not change too much. Slide16
Your Cloud Business Strategy Use Cloud Internally And Share Your Own Best Practices
Gain powerful credibility with customers by using the products you are selling
Become your own best customer success story
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We are using a lot of business intelligence internally to drive how we make business decisions faster. It is
not difficult to transition this from an internal focus to an external offering
as the decision making improvements we have made through the use of smart technology resonates with all commercial businesses. Mark Williams, Partners & Alliances Director, WavexSlide17
Your Cloud Business Strategy You Only Have To Stay One Step Ahead
Cloud technology is evolving rapidly
Successful partners stay one or two steps ahead of
the customer and competitors to be a leader
Create a plan to keep on top of key developments in the solution areas where you focus
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Your Cloud Business Strategy Differentiate With Domain Expertise To Increase Profit
Cloud can commoditize you must differentiate
By
business process (e.g. accounting) or by industry vertical (e.g. retail).
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Our presales technical guys and our architects that are working with the customers to implement our software:
100% we have hired from the industry. Isa Qureshi
, EVP, Client Services,
QLogitek
Slide19
Successful Cloud Partner PracticesYour Cloud Sales Strategy
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Your Cloud Sales StrategyUnderstand Why Cloud Sales Are Fundamentally Different Past: Get to the sale
Now: The sale is the beginning
20Slide21
Your Cloud Sales Strategy
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Open Doors With Cloud, Then Up-sell
Get in the door with Cloud
Up-sell over the long term relationship
Slide22
Your Cloud Sales Strategy Choose the Right Sales Structure For You Separate or Integrated?
Solve for Internal Conflict or Customer Choice?
© IDC Visit us at IDC.com and follow us on Twitter: @IDC
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Separate Cloud Group
Integrated Group Slide23
Your Cloud Sales Strategy Carefully Architect Your Sales Compensation
Problem: How to motivate salespeople who were used to selling up front license + services deals?
If affordable, pay up front
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We changed the bonus triggers for our salespeople
that they get more percentage on the
SaaS sales than they do from on-prem. And they also have to sell a certain percentage of
SaaS
in order to even get the on-
prem
bonus.
Anonymous,
ISV Slide24
Your Cloud Sales Strategy Consider Hiring Outside The Box
Hir
e
young Hire
for value Cloud partners have more staff in sales and marketing vs. other partners
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Your Cloud Sales Strategy Create A Lean, Mean Operating Model For Volume
For a volume play, impetus must be on efficiency
Minimize the cost of making the sale
Consider Telesales To Increase Your Reach Telesales can be a cost effective strategy,
Different skill Metrics driven
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The top sales people, like Charlie, are making 50 to 100 calls per day. The sales cycle is a few days and implementation is a matter of weeks. The focus is on high-volume.
Ben Gower, Managing Director, Perspicuity Slide26
Your Cloud Sales Strategy Take Customers To The Cloud In Steps
Many customers are still not ready to fully dive in
Certain products are good for the first sale, some better to up-sell
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Once customers realize they can
iterate and improve the Azure solution quickly and easily and relatively inexpensively - they go wild. There are no boundaries. The amount of overhead it takes for us to roll out a new set of changes is minuscule, it’s almost nothing.
Alex Brown, CEO, 10
th
MagnitudeSlide27
Your Cloud Sales Strategy Speed Up the Sales Cycle by Sidelining Cloud Objections
Arm your telesales team with resources to take FUD questions off-line
One-page FAQs, videos, web sites, etc.
27Slide28
Successful Cloud Partner PracticesYour Cloud Marketing Strategy
28Slide29
Your Cloud Marketing StrategyShift Your Marketing To Digital
Successful cloud partners are investing in digital marketing
SEO, pay-per-click, banners, videos, webinars, blogs, social media, iterative web pages and landing pages, etc.
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We have a film crew and editing company that does
Youtube
videos for us. Obviously
our goal is to always try to differentiate ourselves
.”
Brian Cook, Executive Chairman,
NintexSlide30
Your Cloud Marketing Strategy30
Establish Your Brand With Thought Leadership
Get known as a thought leader
Some partners provide incentives for staff to publish
We do a lot of bylined articles. I had a bylined article in ‘Wired’ a little while ago, and we just had one in ‘Chain Store Age’ magazine. We typically, I would say
once a month, we have some thought leadership piece out there
. It continues to build presence and awareness and it drives some inbound traffic.
Alex Brown, CEO,10
th
MagnitudeSlide31
Successful Cloud Partner PracticesManaging and measuring
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Managing and measuringFocus on new customers, but also renewals
It is critical to keep existing customers happy
Not as easy as it sounds
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One of the things that we hadn’t intended on doing which was then a
real success for us is the contact center
. When we bring someone onto Office 365, the day they go live they have a 1-800 number. Stephen Alderman, Chief Technical Officer, InverseCurveSlide33
Managing and measuringManage Using New Key Performance Indicators (KPIs)
Monthly Recurring Revenue (MRR)
Recurring Revenue %
Churn % Lifetime Customer Value
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We have a monthly recurring revenue number that we want to hit.
That’s the only metric we actually present back to our staff. And that number is on the wall. If we hit our target, we fly 40 people to Las Vegas in October.
Chris Day, CEO, Fully ManagedSlide34
Essential Guidance34Slide35
Essential Guidance
There are many paths to Cloud success. Common elements of success include:
Recurring revenue models
are slowly but surely replacing traditional project and transactional based models.
Most partners will have to endure some short term pain in order to achieve
long term success, which could include higher margins and a higher company valuation. Those who master a specific vertical or horizontal domain will be able to speak the language of the new power broker in the enterprise, the Line of Business executive.
The time to act is now. There is a land grab going on for cloud customers and there’s not much time left before you find yourself in the bottom half of cloud partners. 35Slide36
Successful Cloud Partners 2.0: What Successful Partners are Doing to Build Profitable Cloud Businesses
Microsoft Cloud Summit , Fall 2014
Marilyn Carr, Partnering and Alliances Research