How and Why to Sell Software-as-a-Service (SaaS / Cloud Solutions)
There is no doubt that the IT industry is fast paced and constantly evolving. Love it or hate it, the fact is your customers are demanding and moving to more cloud based solutions, and this trend will continue. IDC research shows that companies spent £10BN globally on cloud services in 2010, and this will grow to £27BN in 2013.
Cloud computing is a potential game changer for the traditional IT Reseller, one that could reduce margins, change delivery models and routes to market, reduce service revenues and level the playing field for smaller niche resellers.
There are approximately 10 million small and medium businesses in the UK who have not been able to leverage core software applications due to complexity and cost. Cloud computing allows these companies to take advantage of the latest technology with no capital outlay, with no complicated installations, and with a predictable monthly cost.
Those who do not embrace the cloud risk being left behind. Such organisations stand more chance of not being around in 5 years time as customers migrate to cloud solutions, and on premise software returns diminish.
The Impact on Traditional Resellers
In 2011 surveys reported that 29% of resellers already believed the cloud would have a significant
impact on their business. The questions resellers face include:
- How to position, choose, market and sell cloud services.
- How to adjust billing models, support, service delivery and sales commission as you resell both
on-network and cloud offerings.
- How to demonstrate value to your customers and your place in the cloud supply chain.
- How to retain customers who are already moving from on-premise software to the cloud.
- When the delivery model changes from on premise to cloud, a lot of the regular "wrap-around" services associated with installation and management disappear.
So how do I sell it and convey the benefits to my customers?
End users today are driving business consumerisation, expecting to be readily able to access
their "apps" from any mobile device - be it their iPhone, iPad, BlackBerry, Android or other tablet.
The pressure is on for Business IT departments to deliver this within
the constraints of a secure environment for the business and to reduced budgets.
For IT, these demands and pressures make the cloud an attractive option.
For your customers the advantages are clear;
- Reduced costs - predictable, flexible billing and getting "more for less"
- Speed - deploy instantly, upgrades are seamless, new features added continuously
- Mobility - access systems from a range of devices.
- IT Flexibility - giving IT departments the ability to focus on delivering business value instead of fixing things, eliminating the need to perform mundane and costly installs, patches, and updates.
- Always up to date - Gone are the 12 – 18 month cycles waiting for the next version of shrink-wrapped software; in its place, automated updates will be delivered, ensuring a constant stream of cutting-edge, innovative solutions.
consistently show that consideration of cloud or SaaS solutions is driven by ease of change,
flexibility to the business and reduced costs.
The Financial Shift for Customers
Cloud solutions can deliver not only technically, but also financially. Revenue spent can shift to
the Operating Expenditure (OPEX) financial line as opposed to hardware and software licensed
solutions, which sit on the Capital Expenditure (CAPEX).
Combined with reduced costs, rapid
deployments, low or no setup costs, vendor guaranteed support and service level commitments,
these financial benefits have led to an increasing number of firms switching one or more of their
solutions to the cloud.
Stepping into the Cloud
Many resellers are unaware of just how little money they make selling on-premise technology, and how much more they could make selling cloud solutions - not only to existing clients, but to the 15 million small business who cannot afford up-to-date in house IT solutions..
In some cases resellers are looking at a 50% profit increase, just by switching part of their business model to a cloud service one.
Selling Cloud requires fewer resources than on-premise selling, plus it frees up more time to go after new customers.
Regular monthly billing means predictable, growing cash flow rather than one-off sales, and customer retention can be as high as 98%.
Where do Redcoin Fit in as a Cloud Distributor?
We have taken the decision to embrace the cloud, and we believe are uniquely placed to offer a unique and comprehensive aggregated range of IT Security solutions.
We are not a "me-too". Our offering is not a "smoke and mirrors" operation - our carefully selected solutions and back-office integrations will assist our Reseller Partners move into the cloud to be a painless one.
Current cloud solutions offered by Softek include ViperVault Online Backup, AppAssure, McAfee Email and Web filtering, Email continuity, Alertsec full disk encryption - with many more valuable, differential services coming on stream all the time.
Billing is by far the number one issue faced when moving to selling SaaS - and the simple fact is the vast majority of resellers cannot today make the switch from a traditional one off annual up-front invoice, to potentially hundreds of smaller, flexible monthly/quarterly/usage based billing options. Softek can help.
We will of course be offering our traditional "Value Add" services to back up your entry into selling cloud - providing billing services, training, full marketing support, pre-post sale tech support, lead generation, telemarketing, deal registration, excellent margins and more!
Totally unique, some of Softek's offerings can be 100% Rebranded as your own if you so wish - and from where Resellers can manage their own customers, manage the subscriptions, manage billing and add new clients.
Talk to us today...
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