Welcome back to Sherpa’s PX Webinar series, where our channel specialists are joined by leading tech experts to share their insights into channel optimisation through the lens of Partner Experience (PX).
In this instalment of Sherpa’s PX Webinar series, we wanted to look at marketplaces and how Vendors can make marketplace - where high scale, coupled with indirect partner management - work and thrive in a world where Partner experience is so important.
Partner experience begins with a simple question: are your Partners satisfied? As a Vendor, unengaged Partners directly translates into poor customer service which is the driving force behind Channel success in a SaaS world.
What we’ve seen in recent years is that the Channel is evolving rapidly from a productised economy to a recurring revenue one: and cloud marketplace is a key pillar of SaaS models.
In our webinar Go-to-market with ISVs, Sherpa’s Director, Pascale Smith, was joined by a panel of distinguished tech experts - Shaheen Aynikalayil (Director, GSI and Telco at Trend Micro) and Tim Guest (Director of Consulting51) - as they shared their insights into how Vendors could utilise marketplaces to generate long term value for ISVs and themselves.
Thank you to everyone for joining us and to our fantastic panel, Shaheen and Tim, for their astute insights. If you need a recap from the Webinar, please see below or read on for our four key take-aways.
Marketplace as a Strategy
Channel has evolved, and the shift that we have seen towards SaaS means long term success is driven by customer satisfaction. Marketplace has a role to play in achieving this, which hosts a long list of benefits for customers. Primarily, marketplaces offer convenient access to a range of reputable, good-value products.
Marketplaces also offer the opportunity for customers to solve the unique challenges their organisation faces, by cherry-picking products across different Vendors to design their own, bespoke solution. This is great news for ISVs, who are exposed to a community of potential Partners also opting for a collaborative approach. The abundance of analytical data alongside using the right methods will improve company strategy.
"Impartial reviews available on marketplaces are like gold for the customer. It can also provide a new stream of customers." - Shaheen Aynikalayil
At the forefront, cloud marketplaces can benefit the Vendor as they offer quick and scalable access to a new community of engaged customers. For Vendors, the commercial and financial opportunity is real.
Procurement is becoming easier for B2B buyers to use marketplaces with quicker access to tools than traditional direct purchases.
- According to Tackle.io, more than 35% of the Forbes ‘Cloud 100’ companies are active marketplace sellers.
- And Forrester predicts that 17% of global B2B spend will flow through ecommerce and marketplaces.
- Reported in 2021, AWS revenues grew by 32% to reach $13.5 billion; Azure grew by 50%; and Google by 56% (Quocirca: July 2021).
So if you aren’t listed in marketplace in 2021, you may be missing a trick.
Vendor anxieties over committing to marketplace
Developing a marketplace strategy is an increasingly important priority for tech Vendors, we at Sherpa speak to. As part of that marketplace strategy, it is important to understand the partner perspective of generating successful Channel revenue.
Even with in-house experts, it can take anywhere up to 4-6 months for an ISV to get listed into a marketplace. This expertise is costly, and so many organisations share concerns around the considerable level of commitment and investment.
Supporting ISV decisions and evaluation of marketplace strategy is a key strategy area where both Vendors and marketplaces can do more.
"It is critical to gain information about where your customers are going to shop and validate whether you have the capacity to be in a marketplace. Marketplace has to contribute engineering and technical aspects and sales to make this investment successful." - Shaheen Aynikalayil
Additional ways Vendors could support ISVs in their marketplace evaluation would be:
- Expectation setting: a clear and realistic timeline for getting listed
- Specific guides to positive evaluation of the costs and gains of marketplace e.g. a pricing structure
- Offer some tech assistance and support
- Specific incentivisation programmes - both to get listed and then for ongoing promotion and marketing
- Offering a white-glove service for key ISVs with enablement from commercial models, listing but also continuing success
Leveraging marketplace data
Whilst marketplace has been considered a key trend for Channel over the next few years, the growth has exceeded expectations. Unsurprisingly, due to the vast success and the high transaction volumes of marketplaces in recent times, many Vendors have adopted this into their Channel strategy and swarmed there. Marketplace has grown by 35% in 2020 according to the 2020 State of Cloud report.
This has left the space congested, and so it is imperative that as a Vendor you stand out.
But how can you make this happen? One answer could be to create transparency around data to help ISVs ensure marketplace success in the long term.
Marketplace offers huge potential for Vendors to collect analytical data and form a deeper understanding of customers, an element which isn’t fully utilised in supporting ISVs yet .
"Innovation and community go hand in hand with marketplaces." - Pascale Smith
Help your ISVs by using marketplace data to inform about customer trends and what they want from your products or services. Learn what customers are looking for in products and which companies they are speaking to; from there you can tailor your future sales strategies to better meet the demands of your customers.
What can Vendors do to better promote PX in a cloud marketplace environment?
We have spoken about where value lies in cloud marketplaces and how it can benefit your business. So what are the priorities for Vendors to improve a Partner experience in a cloud marketplace?
Poor Partner experience = bad customer experiences = higher churn + lower life-time value
There is a huge amount of investment required to make it in marketplace - from financial and IT commitments to evaluation of customer success for retaining and renewing customers.
ISVs as a business have to make the right investment in the right marketplace that will be relevant and complementary to your own buyers.
Research and long term motivation into marketplaces is needed to ensure Partners choose you. There are over 100 cloud marketplaces so you need to ensure it is relevant and targeted towards your buyers and enable Partners and ISVs to be satisfied and have a positive experience.
The giants of cloud marketplaces - AWS, Azure and GCP - all invest heavily in buyer and seller motivation using data to drive their online strategy and constantly evaluate how to create a seamless workflow relationship within their Channel.
A common mistake in marketplace is after battling hard to get their foot in the door, Partners find that they can easily get lost in the crowd. As we have discussed, customers are spoilt for choice, and so it is imperative that your product or service offering stands out.
Many Vendors miss the opportunity to connect with new Partners and ISVs in marketplaces to collaborate and form partnerships to expand their service offering. However this is key to not only appearing more attractive to potential customers but to also retain previous customers.
So there we have it - cloud marketplaces boast many positive opportunities for Vendors to drive both their PX and CX. However as a Vendor, you should be prepared and set expectations for the full-bodied investment that comes hand in hand with resourcing marketplace. Time, energy and investment are key to conquering the space.
Active collaboration is now the dominant theme within marketplaces and increasingly over the channel ecosystem as a whole. Vendors can see who their competition are and are keen to use data to evaluate their approaches to be the customer choice.
Be sure to take existing Partners with you on your journey, and preach the advantages of marketplace to ensure they understand the opportunities it withholds.
Thank you again to our fantastic panel Shaheen Aynikalayil and Tim Guest for sharing your unique insights.