When is the Right Time to Consider Entering a New Cloud Marketplace or Opening Up a New Channel of Business?
Your solution on its own has been enough to build a business but as you think about ways to expand that business, partnerships and expanding into app marketplaces is one area to consider.
Salesforce, ServiceNow, Hubspot, Microsoft, AWS, and more have built entire ecosystems of supportive apps to their products. Because these large platforms can’t keep up with every feature request and use case needed for customers, their marketplaces have become big money makers. Not only for the platforms themselves who make a percentage of each app sold, but for the ISVs hosting their apps on these marketplaces. These solutions make a real impact to those companies driving strong partnerships and real dollars for those businesses who are invested here.
The Salesforce economy continues to grow rapidly and is poised to create $1.6 Trillion in new business revenue by 2026. As Salesforce expands its revenue, ISVs can expect their Serviceable Available Market(SAM) to expand at a similar rate. Future revenue projections are $50 Billion for Salesforce directly by FY26.
Not every ecosystem offers the same benefits and what is right for one business is not for another so in this blog we wanted to offer our advice on where to begin your consideration.
1. Go where your customers are
You’ve built customer relationships through trust and offering a service they need. When you start to think about where you can expand your business, think about where your customers are also investing. If your customers are also heavily invested in Salesforce or ServiceNow, those might be ecosystems you want to explore. There are solutions that help you understand what technology your customers use or you can do it the old fashioned way and have a sales person ask them (and log it in CRM!).
2. Understand your customers use cases and investmen
If your customers are invested in Salesforce, ServiceNow or others, identify if there are tasks they do today that would be easier if your solution was integrated directly into that platform.
3. Identify where you fill in gaps
As we mentioned earlier, these platforms need ISVs to help fill gaps in their current product offerings. Not every cloud or workflow can address every customer use case needed. This is where ISVs come in. ISVs specialize in one specific area and enhance the core offering.
For example – Salesforce has a limited document generation solution built into Sales Cloud, however if you want more customizable and complex quotes, proposals or presentations you may consider purchasing an app from the AppExchange that specializes in complex document generation.
As you explore the ecosystem(s) where your customers are, you need to also understand the out-of-the-box features and functions that come with a Salesforce Cloud or ServiceNow Workflow. You do not want to find yourself competing against sellers selling their own products. The sellers will choose their product over yours every time unless you offer something that the customer needs and out-of-the-box is not available. Concepts like whitespace, blackspace, and greyspace are important for ISVs who choose to build in an ecosystem like Salesforce where they are pushing 3 major releases per year as well as growing via acquisition. Your messaging to Salesforce sellers needs to be precise and up-to-date.
4. Understand your competitive landscape
Before you jump feet first into the deep end of your ecosystem partnership, it’s best to understand which sharks are already in the water. Spend some time on the marketplace in question like the AppExchange or ServiceNow Store to identify who else is there.
- Are the competitors you run into on deals everyday also on the marketplace?
- If yes – this might be a reason to get in to keep a competitive edge with new prospects
- If no – great news – you now have a differentiator and one more reason that a prospect should consider you.
5. Partner opportunities
If you work with system integrators today, tap into those relationships to gauge how they think your business would fit into their current projects. If they have Salesforce, Hubspot, Microsoft or ServiceNow practices, what sort of projects do they see where you could fit in, where do they see the most opportunity for you and where can you help fill in gaps for them.
Once you have a view of the ecosystem and where you could potentially play, you have the opportunity to start shopping it around internally to gain buy in and approval.
Where to begin:
Start by talking to your customers and partners.
The best way to truly understand where your customers are and where you could consider expanding is to start asking the questions. During your next QBR or meeting with your champion ask where else they are investing this year, what solutions they use alongside yours that could benefit from a closer integration. Similarly with your partners – understand where they see a need for you and where they think you should invest.
Identify the opportunity
Understand your TAM, SAM and KPIs
- What does your current customer opportunity look like
- If you sold this into 10%, 35%, 50% of those current customers what would that revenue stream look like
- How could this affect your competitive positioning
- Where could this lead to additional revenue streams
- What would success look like at day 60, 90, 365?
Get executive buy in.
Entering a new ecosystem will take time, work and budget so it is key that you have an internal executive sponsor who believes in the expansion and partnership plan.
- You need an app which means either a development team that understands the Salesforce or ServiceNow platform or investment in a PDO like Yansa, Appiphony, or CodeScience who can have the experience and can build you a solution – at a cost.
- You need marketing to support go-to-market launch including messaging, collateral and more.
- You need a partner person or team who can build a relationship with the internal CRM sales team.
Articulate benefits to your business:
- Increase customer loyalty and stickiness
- Reduce churn
- Create new revenue streams
- Differentiate from your competitors
New channels of business bring new opportunities for revenue but it’s often hard to know where to start. We hope this guide helps you along your journey to your next big partnership. And if at any point in time you feel overwhelmed, know that there are resources available to get you to success faster.
Want to learn more about how InVisory can help you on your cloud marketplace journey? Contact us — we’re here to help!