By Richard Dufty, VP of Worldwide Sales and Strategic Partnerships
Today’s small and medium-sized businesses (SMBs) are driving a software revolution. Just a few years ago, these companies went to retail locations to buy software, install it, and configure their systems to run it—or hire someone to do all of this for them. Now SMBs can simply go online to purchase and use powerful cloud-based software solutions.
In fact, more SMBs than ever before are turning to these cloud solutions; recent research indicates that 60 percent of SMBs currently use cloud services, a number that is set to grow rapidly within the next few years. Sparked by this growth, the worldwide market for SMB cloud computing is predicted to reach $40 billion by the end of this year.
Software providers are already starting to see real evidence of these trends. In late May 2013, Microsoft announced that the cloud-based version of its flagship productivity suite, called Office 365, reached one million subscribers in 100 days, faster than Dropbox and Facebook. Microsoft’s numbers translate to an average of more than one Office 365 subscription sold every second in the last three and a half months.
Demand for Cloud Services Rises, but Success Isn’t Guaranteed
As SMBs increase demand for cloud-based apps, cloud service marketplaces are increasingly common. According to Gartner, 50 percent of the top 100 service providers will offer cloud services to their customers by 2015.
“Service providers really do not have a choice,” the analyst firm adds, “but must offer cloud services to protect their current market and to stay connected to their customers.”
Despite the surge of marketplaces, SMBs still face challenges purchasing and managing cloud-based applications. Almost 60 percent of SMBs say they lack the resources to implement new technologies, while 57 percent say they simply don’t have the time to do so.
For these reasons, service providers are ideally positioned to become SMBs’ cloud partner of choice. These providers already serve an important role for SMBs, offering essential business services—including Internet, voice, and mobile—that companies rely on. For busy SMBs, the option of turning to a trusted provider for cloud solutions can not only save time, but also make cloud adoption less intimidating.
Despite this interest and rising demand, simply launching a cloud service marketplace doesn’t guarantee it will thrive. As any businessperson knows, there’s more to success than setting up shop and waiting for customers to appear. Whether a major retail chain, a startup e-commerce site, or an app marketplace, every business needs a strategy to attract prospects and convert them to paying customers.
A skilled sales team can be a powerful asset in almost any sales situation, including selling SaaS apps through a web-based marketplace. In fact, as more SMBs transition to the cloud, creating a “white glove” experience will be one of the most valuable services providers can offer. Rather than just making a one-off sale, the ability for sales teams to be expert cloud consultants to their SMB customers will be an increasingly important differentiator for service providers.
The Benefits of Working with an Expert in Cloud Services Commerce
As the SMB software revolution continues to gain steam, assisted sales will play an important role in both driving cloud services revenue and helping customers find the most relevant, useful solutions for their businesses. To help ensure success, providers should explore working with a partner who can provide both the technical and go-to-market expertise necessary to support a cloud services sales team.
AppDirect offers a monetization and management platform that makes it easy for for providers to distribute, sell, and market cloud services. Currently, AppDirect powers the marketplaces, billing and distribution, and reselling services of leading global companies—including Samsung, Deutsche Telekom, Staples and others—and helps connect 20 million business users to solutions from Microsoft, Google, Box and more.
Learn more about how AppDirect can help you become a cloud services provider of choice for SMBs at the Telco Cloud World Forum North America, October 7th and 8th, in Dallas, Texas. You can also click here to download our assisted sales white paper.