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                                        Solution Marketing
                                        Best Practices
                                                                   Steve Robins
                                                                       Principal
                                                   Solution Marketing Strategies
                                                             November 7, 2009


© Solution Marketing Strategies, 2009
About This Presentation

         Following are the slides presented at ProductCamp Boston
         on November 7, 2009.
         Check out The Solution Marketing Blog –
         http://bit.ly/pcampsol for supplemental material.


         Join the Solution Marketing Community!
          – Subscribe to The SolutionMarketingBlog (see “Subscribe” on the right):.
          – Join Solution Marketing Pros on LinkedIn:
            http://www.linkedin.com/groups?home=&gid=1826720 .




© 2009                                                                                p2
Steve Robins

         10+ years in solution marketing
           – Expertise in product, solution and industry marketing
           – Experience: EMC Documentum, KANA, The Yankee Group and more

         Principal, Solution Marketing Strategies
         Founder, The Solution Marketing Blog
         Inbound Marketing Certified Professional
         If I can help you in any way, please let me know:

               s.robins@SolutionMKT.com
                                  SteveRobins1
               www.LinkedIn.com/in/


               www.Twitter.com/SteveRobins
               www.SolutionMarketingBlog.com
               www.SolutionMarketingStrategies.com                     www.barcamp.org/ProductCampBoston




© 2009                                                                                                     p3
Walmart: People Need Solutions




         “   With some of our customers
             who live paycheck to
             paycheck, they need
             solutions to problems,
             not another ad campaign.
                                                               ”
                                                           Stephen F. Quinn
                            Executive VP and Chief Marketing Officer, Walmart
                                     2009 ANA Annual Conference, 11/6/2009

                                         Sources: Carole Gunst/@aaronstrout




© 2009                                                                          p4
Not A Solution to the Customer’s Problem




                                           Product




© 2009                                               p5
Complete Solution to the Customer’s Problem

                                            Solution




© 2009                                                 p6
Complete Solution to the Customer’s Problem
                                             People
                                             • User interfaces
         Technology                          • Training
         • Applications                      • Support
         • Complementary                     • Best practices
           technologies                      • Domain expertise
         • Hardware and
           infrastructure                      Process
         • Custom coding                       • ROI studies
         • Integration services                  Reengineering
                                               • Process optimization –
                                                 efficiency,
           Information                           effectiveness
           • Data
           • Content, documents,     Services
             images                  • Strategy
           • External data sources   • Project management
           • Data security           • Risk management
           • Data policies           • Custom coding
                                     • Integration services

© 2009                                                            p7
Definition


    so·lu·tion mar·ket·ing. Noun.
    The process of defining, educating,
    and providing access to complete and
    integrated solutions that deliver
    customer value by helping customers
    to solve their problems.


© 2009                                 p8
Solution Marketing Requires a New Model


                                                            Promotion



                                          Product
                                                              P
                                                                        Price

                                           P          The 4 P’s
                                                                        P
                                                    Place


                                                    P

Derived from SIVA model, Chekitan & Dev


© 2009                                                                          p9
Solution Marketing Requires a New Model
    The 4 P’s - updated


                                                           Education



                                         Solution                        Value
                                                           SEVA
                                                    Solution Marketing


                                                     Access




Derived from SIVA model, Dev & Schultz


© 2009                                                                           p10
Solution Marketing Adds Value To
    Marketing, Sales and Product Management




                                          Field
                                       Enablement
            Social Media                                            Frictionless
                                                                       Sales



                                              Education



                            Solution                        Value
                                              SEVA
                                       Solution Marketing


                                        Access

         Marketing                                                         Product
          Support                                                        Management
                           Solution Marketing



© 2009                                                                                p11
Solution Marketing Best Practices


                                  Education



Education       Solution                        Value
                                  SEVA
                           Solution Marketing


                            Access




                Text




© 2009                                                  p12
Solution

    Solution

         Strategy
             – Deliver complete solutions that address as much of the problem as possible
             – Include partners, services, data
         Solution portfolio management
             –   Market assessment
             –   Solution strategy
             –   Target solution identification
             –   Revenue estimates                                         Solution
         Solution research                                                People
             – Business challenges                                        Process
             – Use cases                                                  Information

         Solution development                                             Technology
             –   Components                                               Services
             –   Products/enhancements
             –   Partners
             –   Services


Derived from SIVA model, Chekitan & Dev


© 2009                                                                                         p13
Solution
    PowerAdvocate
    Complete Procurement Solutions for the Utility Industry


         PowerAdvocate
          – Provides market and cost intelligence solutions to energy (utilities)
            companies to optimize procurement.
                                                                              Solution
         Challenge                                                            People
          – Differentiate the company from larger players                     Process
            like Ariba                                                        Information
                                                                              Technology
         Solution strategy                                                    Services
          – Products: SaaS solutions for procurement spend, cost, market, sourcing
          – Services: Industry experts provide services to lower costs
          – Data: Market-specific procurement data and analysis

         Differentiator: industry-specific data



© 2009                                                                                      p14
Intuit Quicken Stays,                                     Solution

    Microsoft Money Folds

                            “Intuit is one of the few companies to
                             “Intuit is one of the few companies to
                            take Microsoft head-on on its home
                             take Microsoft head-on on its home
                            turf--packaged software--and come out
                             turf--packaged software--and come out
                            on top.”
                             on top.”


                            "It really has very little to do with
                             "It really has very little to do with
                            technology," said Cape… "What Intuit
                             technology," said Cape… "What Intuit
                            and Scott Cook were so formidable at
                             and Scott Cook were so formidable at
                            was consumer marketing.”
                             was consumer marketing.”


                            “NPD analyst Stephen Baker said that
                             “NPD analyst Stephen Baker said that
                            Intuit won out because ititwas
                             Intuit won out because was
                            aggressive and built critical mass in the
                             aggressive and built critical mass in the
                            finance software arena, adding aa
                             finance software arena, adding
                            number of adjacent products and
                             number of adjacent products and
                            dominating the retail channel.”
                             dominating the retail channel.”


© 2009                                                           p15
Solution

    Intuit Quicken vs. Microsoft Money




               “
                     The only thing the
                     customer cares about
                     is your time spent
                     solving their problem
                                                                  ”
                                                                  Scott Cook
                              Founder & Chairman of the Executive Committee
                                                                        Intuit
                                                              June 11, 2009




© 2009                                                                    p16
Solution

    Intuit Quicken vs. Microsoft Money

         Intuit Quicken
          – Top-selling personal finance software; first release 1984

         Challenge
          – Competitive marketplace (46 in 1984 alone)                        Solution
                                                                             People
          – Ongoing competition with Microsoft Money (1991+)
                                                                             Process
         Solution strategy                                                   Information
                                                                             Technology
          – Heavy focus on ease-of-use, familiar UI
                                                                            Services
          – Constantly monitored customer usage and market trends
          – Holistic approach to solving the customer’s most important problems

         Differentiator: whole product approach vs. Microsoft
         product-centric approach



© 2009                                                                                     p17
Education


    Education & Engagement

         Strategy
             – Educate the market on the problem and how to solve it (awareness)
             – Then educate on your solution (demand generation)
             – Actively engage in an ongoing dialog with the market

         Research - understand the customer
             – Persona, typical titles
             – Optimum communication channels
                                                                                   Dang
         Deliver a relevant message                         Customer
                                                                                       e   r
                                                            Expectations
             – Industry lingo
             – Business benefits rather than technical      Message

         Avoid the solution paradox                         Solution

             – Customers want “out-of-the-box”
               but no one company can do it all
             – Set clear expectations

Derived from SIVA model, Chekitan & Dev


© 2009                                                                                         p18
Education


    HubSpot

         HubSpot
          – Provides an inbound marketing system to help small and medium sized businesses
            get found on the Internet and convert suspects into leads and customers for
            maximum ROI.
          – Web content management - marketing automation - analytics.
          – 1700 customers; founded 2006.
         Challenge                                                              Solution
          – Startup – gain attention in crowded market.                         People
          – Maximize limited marketing dollars.                                 Process
                                                                                Information
         Strategy
                                                                                Technology
          – Inbound marketing – focus on SEO and education
            rather than interruptive product promotion.                         Services
          – Content machine!
          – Provide extensive value-added content –
            at no charge.
         Lesson: inbound marketing dramatically lowers marketing costs



© 2009                                                                                        p19
HubSpot’s Inbound Marketing:                                                                                                  Education


    More Effective Than Traditional Marketing
             Registration
         1    required                                                    2       100
                                                                                   90
                                                                                   80
                                                                                   70
                                                                                   60
                                                                                   50
                                                                                   40
                                                                                   30
                                                                                   20
                                                     "Free" content                10

                                                       (80-90%)                    0
                                                                                          Reg required   No reg required


                   Most HubSpot content is available                                    …because “free” content
                        without registration…                                           yields 10-20x readership

                                                                              Blog subscribers                               20,000
         3                                                            4
                                                                              Typical webinar attendance
                                                                              (general interest)
                                                                                                                            3-4,000
                                                                              Typical webinar attendance
                                                                              (product)
                                                                                                                           500 – 1,000
                                                                              Inbound Marketing Certified
                                                                              Professionals                                  1,000
                    Push Marketing   Inbound Marketing

                    Customer acquisition:                                     Sites analyzed on Website Grader             1.6 million
              Inbound marketing costs 5-7x less
                                                                              Twitter profiles analyzed on
                than traditional push marketing
                                                                              Twitter Grader
                                                                                                                            7 million


© 2009                                                                                                                                  p20
Value

    Value

         Strategy
             – Ensure that the customer achieves the level of value they expect
             – Justify and articulate the value through ROI models
             – Consider TCO and customer benefit

         Research
             –   Identify and place value on significant customer purchase drivers
             –   Common ROI models/”before-afters”
             –   Purchasing habits
             –   Budget trends

         Action!
             – Articulate value in terms of price, ROI, TCO, customer benefit
             – Develop ROI assessments with consulting/system integrator partners
             – Reference customers – value achieved


Derived from SIVA model, Chekitan & Dev


© 2009                                                                                p21
Value
                                                                      Value = Benefit - TCO
    Value-Based Pricing

                                                                               Assume that vendor charges fair price
                                                                               for features provided
         Business Benefit ($)




                                                Lost revenue

                                Customer                                                      Benefit
                                                                                        Unneeded features
                                Benefit



                                                     Customer         Benefit
                                                     Benefit                                 Price


                                                                    Customer                  Customer
                                                                    Benefit                   Benefit
                                     A                    B             C                            D
                                High Value          Fair Value      Poor Value               Fair Value
                                Lost software       Price matches   Unneeded                 Price matches
                                revenue             benefit         features                 benefit


                                   Solution use-case drives benefit and value


© 2009                                                                                                                  p22
Oracle and SAP                                                                             Value

    Price-Benefit Disparity in ERP Support

         Oracle, SAP
          – Top 2 ERP software companies.
          – Provide support services - troubleshooting, bug fixes, upgrades.

         Situation
          – Oracle and SAP charge high prices for support, and new providers like
            Rimini Street are moving in. Rimini charges ½.
          – SAP announced planned support increases in fall 2008, from 17% to 22% in
            some cases. In April 2009, customers pressured SAP to measure KPI’s
            prior to implementation.

         Lesson                                                   Maintenance Fees
                                                                  (% of license fees)       22%
          – Minimize customer defections by matching
            price to customer benefit.                            Services margin           90%
                                                                  Services % of
                                                                  corporate revenue         51%
                                                                            InformationWeek October 2009




© 2009                                                                                            p23
Oracle and SAP                                                                                                      Value

    Price-Benefit Disparity in ERP Support

                                                                                Assume that vendor charges fair price
                                                                                for features provided
         Business Benefit ($)




                                                Lost revenue

                                Customer                                                       Benefit
                                                                                         Unneeded features
                                Benefit



                                                      Customer         Benefit
                                                      Benefit                                 Price


                                                                     Customer                  Customer
                                                                     Benefit                   Benefit
                                     A                    B              C                            D
                                High Value          Fair Value       Poor Value               Fair Value
                                Lost software       Price matches    Unneeded                 Price matches
                                revenue             benefit          features                 benefit



                                                17%        22% fee

© 2009                                                                                                                   p24
Microsoft SharePoint Delivers Value –                                                                         Value

    With Just 50% Functionality

         Microsoft SharePoint
          – Rapidly growing collaborative content platform, currently $1.3 billion annual sales
         Challenge - competiton
          – Established premise enterprise content management (ECM) vendors --
            EMC Documentum, OpenText, IBM FileNet
          – Open source -- Alfresco, Drupal/Acquia, Nuxeo
          – SaaS – SpringCM, others
                                                                                                      E
         Solution strategy
          –   Remove the “E” in ECM
          –   Stick with 50% of required features
          –   Free software                            Annual growth (users, revenue)*                    25%
          –   Add more advanced features over time
                                                       Licensed users, FY 2009
                                                       (ended 6/30/09)*                           130 million
         Lesson: Customers achieve
         value by buying only the                      Annual revenue, FY 2009*                   $1.3 billion
         features they need
                                                       Average license/user                               $10
                                                                              * Microsoft SharePoint press release October 2009




© 2009                                                                                                               p25
Microsoft SharePoint Delivers Value –                                   Value

    With Just 50% Functionality




    “
           We don’t claim we do everything.
           If we do 50 percent of the functions
           that these other companies do, but
           they’re the ones customers really
           want, that’s fine. The magic is that
           end users actually like to use the
           software.
                                                               ”
                                                              Chris Capossela
                                                         Senior Vice President
                                Information Worker Product Management Group
                                                                     Microsoft

                                                           NY Times 8/2/2009




© 2009                                                                           p26
Microsoft SharePoint Delivers Value –                                                                              Value

    With Just 50% Functionality

                                                                               Assume that vendor charges fair price
                                                                               for features provided
         Business Benefit ($)




                                                Lost revenue

                                Customer                                                      Benefit
                                                                                        Unneeded features
                                Benefit



                                                     Customer         Benefit
                                                     Benefit                                 Price


                                                                    Customer                  Customer
                                                                    Benefit                   Benefit
                                     A                    B             C                            D
                                High Value          Fair Value      Poor Value               Fair Value
                                Lost software       Price matches   Unneeded                 Price matches
                                revenue             benefit         features                 benefit




© 2009                                                                                                                  p27
Access

    Access

         Strategy
             – Enable customers to access/purchase your solution in the manner that works best for
               them.
                         Direct or channel
                         Premise or SaaS
             – Give choices where they make sense
             – Ensure customer success through “the last mile”

         Research
             – Common purchasing channels?
             – Do they prefer to buy through VAR’s? Through SI’s? Direct? On contract?
             – Preferred delivery models… Software? SaaS? Business Process Outsourcing?
         Action!
             –   Enable the customer to purchase the solution through the channels that they want
             –   New channels – beyond the traditional
             –   Marketer provides fastest, least-expensive access
             –   Follow up and training to successfully complete the sale/deployment


Derived from SIVA model, Chekitan & Dev


© 2009                                                                                              p28
Amazon Kindle – Buy Books When, Where                                                                   Access

    and How You Want

         Amazon Kindle
          – First introduced November 2007
          – Download books via wireless                                                  Solution
          – iPhone Kindle app                                                           People
                                                                                        Process
         Included                                                                       Information

          –   Wireless access (small fee overseas)                                      Technology
                                                                                        Services
          –   Access to 360k book library
          –   Device can hold 1500 books
          –   Permanent virtual library at Amazon.com

         Strategy
          – Complete system – technology, content,
            delivery
          – Access content when and where you wish
                                                        Kindle downloads first eclipsed computer downloads in July ‘09



© 2009                                                                                                           p29
Access

    Access - Additional Examples

                  Comcast uses Salesforce.com tools to
                  monitor issues on Twitter.
                  Go where the customers are.

                  Salesforce.com enables users to buy SaaS
                  apps via Appexchange.

                  Apple enables users to buy iPhone apps
                  from AppStore.

                  SaaS or premise software?
         SaaS     Pick one – not both.



© 2009                                                     p30
Discussion

         Your experience?

         Q&A

         Thanks!




© 2009                      p31
Steve Robins

         10+ years in solution marketing
           – Expertise in product, solution and industry marketing
           – Experience: EMC Documentum, KANA, The Yankee Group and more

         Principal, Solution Marketing Strategies
         Founder, The Solution Marketing Blog
         Inbound Marketing Certified Professional
         If I can help you in any way, please let me know:

               s.robins@SolutionMKT.com
                                  SteveRobins1
               www.LinkedIn.com/in/


               www.Twitter.com/SteveRobins
               www.SolutionMarketingBlog.com
               www.SolutionMarketingStrategies.com                     www.barcamp.org/ProductCampBoston




© 2009                                                                                                p32
Solution Marketing
                                        Best Practices
                                                                   Steve Robins
                                                                       Principal
                                                   Solution Marketing Strategies
                                                             November 7, 2009


© Solution Marketing Strategies, 2009

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Solution Marketing Best Practices Presentation

  • 1. As presented at: Solution Marketing Best Practices Steve Robins Principal Solution Marketing Strategies November 7, 2009 © Solution Marketing Strategies, 2009
  • 2. About This Presentation Following are the slides presented at ProductCamp Boston on November 7, 2009. Check out The Solution Marketing Blog – http://bit.ly/pcampsol for supplemental material. Join the Solution Marketing Community! – Subscribe to The SolutionMarketingBlog (see “Subscribe” on the right):. – Join Solution Marketing Pros on LinkedIn: http://www.linkedin.com/groups?home=&gid=1826720 . © 2009 p2
  • 3. Steve Robins 10+ years in solution marketing – Expertise in product, solution and industry marketing – Experience: EMC Documentum, KANA, The Yankee Group and more Principal, Solution Marketing Strategies Founder, The Solution Marketing Blog Inbound Marketing Certified Professional If I can help you in any way, please let me know: s.robins@SolutionMKT.com SteveRobins1 www.LinkedIn.com/in/ www.Twitter.com/SteveRobins www.SolutionMarketingBlog.com www.SolutionMarketingStrategies.com www.barcamp.org/ProductCampBoston © 2009 p3
  • 4. Walmart: People Need Solutions “ With some of our customers who live paycheck to paycheck, they need solutions to problems, not another ad campaign. ” Stephen F. Quinn Executive VP and Chief Marketing Officer, Walmart 2009 ANA Annual Conference, 11/6/2009 Sources: Carole Gunst/@aaronstrout © 2009 p4
  • 5. Not A Solution to the Customer’s Problem Product © 2009 p5
  • 6. Complete Solution to the Customer’s Problem Solution © 2009 p6
  • 7. Complete Solution to the Customer’s Problem People • User interfaces Technology • Training • Applications • Support • Complementary • Best practices technologies • Domain expertise • Hardware and infrastructure Process • Custom coding • ROI studies • Integration services Reengineering • Process optimization – efficiency, Information effectiveness • Data • Content, documents, Services images • Strategy • External data sources • Project management • Data security • Risk management • Data policies • Custom coding • Integration services © 2009 p7
  • 8. Definition so·lu·tion mar·ket·ing. Noun. The process of defining, educating, and providing access to complete and integrated solutions that deliver customer value by helping customers to solve their problems. © 2009 p8
  • 9. Solution Marketing Requires a New Model Promotion Product P Price P The 4 P’s P Place P Derived from SIVA model, Chekitan & Dev © 2009 p9
  • 10. Solution Marketing Requires a New Model The 4 P’s - updated Education Solution Value SEVA Solution Marketing Access Derived from SIVA model, Dev & Schultz © 2009 p10
  • 11. Solution Marketing Adds Value To Marketing, Sales and Product Management Field Enablement Social Media Frictionless Sales Education Solution Value SEVA Solution Marketing Access Marketing Product Support Management Solution Marketing © 2009 p11
  • 12. Solution Marketing Best Practices Education Education Solution Value SEVA Solution Marketing Access Text © 2009 p12
  • 13. Solution Solution Strategy – Deliver complete solutions that address as much of the problem as possible – Include partners, services, data Solution portfolio management – Market assessment – Solution strategy – Target solution identification – Revenue estimates Solution Solution research People – Business challenges Process – Use cases Information Solution development Technology – Components Services – Products/enhancements – Partners – Services Derived from SIVA model, Chekitan & Dev © 2009 p13
  • 14. Solution PowerAdvocate Complete Procurement Solutions for the Utility Industry PowerAdvocate – Provides market and cost intelligence solutions to energy (utilities) companies to optimize procurement. Solution Challenge People – Differentiate the company from larger players Process like Ariba Information Technology Solution strategy Services – Products: SaaS solutions for procurement spend, cost, market, sourcing – Services: Industry experts provide services to lower costs – Data: Market-specific procurement data and analysis Differentiator: industry-specific data © 2009 p14
  • 15. Intuit Quicken Stays, Solution Microsoft Money Folds “Intuit is one of the few companies to “Intuit is one of the few companies to take Microsoft head-on on its home take Microsoft head-on on its home turf--packaged software--and come out turf--packaged software--and come out on top.” on top.” "It really has very little to do with "It really has very little to do with technology," said Cape… "What Intuit technology," said Cape… "What Intuit and Scott Cook were so formidable at and Scott Cook were so formidable at was consumer marketing.” was consumer marketing.” “NPD analyst Stephen Baker said that “NPD analyst Stephen Baker said that Intuit won out because ititwas Intuit won out because was aggressive and built critical mass in the aggressive and built critical mass in the finance software arena, adding aa finance software arena, adding number of adjacent products and number of adjacent products and dominating the retail channel.” dominating the retail channel.” © 2009 p15
  • 16. Solution Intuit Quicken vs. Microsoft Money “ The only thing the customer cares about is your time spent solving their problem ” Scott Cook Founder & Chairman of the Executive Committee Intuit June 11, 2009 © 2009 p16
  • 17. Solution Intuit Quicken vs. Microsoft Money Intuit Quicken – Top-selling personal finance software; first release 1984 Challenge – Competitive marketplace (46 in 1984 alone) Solution People – Ongoing competition with Microsoft Money (1991+) Process Solution strategy Information Technology – Heavy focus on ease-of-use, familiar UI Services – Constantly monitored customer usage and market trends – Holistic approach to solving the customer’s most important problems Differentiator: whole product approach vs. Microsoft product-centric approach © 2009 p17
  • 18. Education Education & Engagement Strategy – Educate the market on the problem and how to solve it (awareness) – Then educate on your solution (demand generation) – Actively engage in an ongoing dialog with the market Research - understand the customer – Persona, typical titles – Optimum communication channels Dang Deliver a relevant message Customer e r Expectations – Industry lingo – Business benefits rather than technical Message Avoid the solution paradox Solution – Customers want “out-of-the-box” but no one company can do it all – Set clear expectations Derived from SIVA model, Chekitan & Dev © 2009 p18
  • 19. Education HubSpot HubSpot – Provides an inbound marketing system to help small and medium sized businesses get found on the Internet and convert suspects into leads and customers for maximum ROI. – Web content management - marketing automation - analytics. – 1700 customers; founded 2006. Challenge Solution – Startup – gain attention in crowded market. People – Maximize limited marketing dollars. Process Information Strategy Technology – Inbound marketing – focus on SEO and education rather than interruptive product promotion. Services – Content machine! – Provide extensive value-added content – at no charge. Lesson: inbound marketing dramatically lowers marketing costs © 2009 p19
  • 20. HubSpot’s Inbound Marketing: Education More Effective Than Traditional Marketing Registration 1 required 2 100 90 80 70 60 50 40 30 20 "Free" content 10 (80-90%) 0 Reg required No reg required Most HubSpot content is available …because “free” content without registration… yields 10-20x readership Blog subscribers 20,000 3 4 Typical webinar attendance (general interest) 3-4,000 Typical webinar attendance (product) 500 – 1,000 Inbound Marketing Certified Professionals 1,000 Push Marketing Inbound Marketing Customer acquisition: Sites analyzed on Website Grader 1.6 million Inbound marketing costs 5-7x less Twitter profiles analyzed on than traditional push marketing Twitter Grader 7 million © 2009 p20
  • 21. Value Value Strategy – Ensure that the customer achieves the level of value they expect – Justify and articulate the value through ROI models – Consider TCO and customer benefit Research – Identify and place value on significant customer purchase drivers – Common ROI models/”before-afters” – Purchasing habits – Budget trends Action! – Articulate value in terms of price, ROI, TCO, customer benefit – Develop ROI assessments with consulting/system integrator partners – Reference customers – value achieved Derived from SIVA model, Chekitan & Dev © 2009 p21
  • 22. Value Value = Benefit - TCO Value-Based Pricing Assume that vendor charges fair price for features provided Business Benefit ($) Lost revenue Customer Benefit Unneeded features Benefit Customer Benefit Benefit Price Customer Customer Benefit Benefit A B C D High Value Fair Value Poor Value Fair Value Lost software Price matches Unneeded Price matches revenue benefit features benefit Solution use-case drives benefit and value © 2009 p22
  • 23. Oracle and SAP Value Price-Benefit Disparity in ERP Support Oracle, SAP – Top 2 ERP software companies. – Provide support services - troubleshooting, bug fixes, upgrades. Situation – Oracle and SAP charge high prices for support, and new providers like Rimini Street are moving in. Rimini charges ½. – SAP announced planned support increases in fall 2008, from 17% to 22% in some cases. In April 2009, customers pressured SAP to measure KPI’s prior to implementation. Lesson Maintenance Fees (% of license fees) 22% – Minimize customer defections by matching price to customer benefit. Services margin 90% Services % of corporate revenue 51% InformationWeek October 2009 © 2009 p23
  • 24. Oracle and SAP Value Price-Benefit Disparity in ERP Support Assume that vendor charges fair price for features provided Business Benefit ($) Lost revenue Customer Benefit Unneeded features Benefit Customer Benefit Benefit Price Customer Customer Benefit Benefit A B C D High Value Fair Value Poor Value Fair Value Lost software Price matches Unneeded Price matches revenue benefit features benefit 17% 22% fee © 2009 p24
  • 25. Microsoft SharePoint Delivers Value – Value With Just 50% Functionality Microsoft SharePoint – Rapidly growing collaborative content platform, currently $1.3 billion annual sales Challenge - competiton – Established premise enterprise content management (ECM) vendors -- EMC Documentum, OpenText, IBM FileNet – Open source -- Alfresco, Drupal/Acquia, Nuxeo – SaaS – SpringCM, others E Solution strategy – Remove the “E” in ECM – Stick with 50% of required features – Free software Annual growth (users, revenue)* 25% – Add more advanced features over time Licensed users, FY 2009 (ended 6/30/09)* 130 million Lesson: Customers achieve value by buying only the Annual revenue, FY 2009* $1.3 billion features they need Average license/user $10 * Microsoft SharePoint press release October 2009 © 2009 p25
  • 26. Microsoft SharePoint Delivers Value – Value With Just 50% Functionality “ We don’t claim we do everything. If we do 50 percent of the functions that these other companies do, but they’re the ones customers really want, that’s fine. The magic is that end users actually like to use the software. ” Chris Capossela Senior Vice President Information Worker Product Management Group Microsoft NY Times 8/2/2009 © 2009 p26
  • 27. Microsoft SharePoint Delivers Value – Value With Just 50% Functionality Assume that vendor charges fair price for features provided Business Benefit ($) Lost revenue Customer Benefit Unneeded features Benefit Customer Benefit Benefit Price Customer Customer Benefit Benefit A B C D High Value Fair Value Poor Value Fair Value Lost software Price matches Unneeded Price matches revenue benefit features benefit © 2009 p27
  • 28. Access Access Strategy – Enable customers to access/purchase your solution in the manner that works best for them. Direct or channel Premise or SaaS – Give choices where they make sense – Ensure customer success through “the last mile” Research – Common purchasing channels? – Do they prefer to buy through VAR’s? Through SI’s? Direct? On contract? – Preferred delivery models… Software? SaaS? Business Process Outsourcing? Action! – Enable the customer to purchase the solution through the channels that they want – New channels – beyond the traditional – Marketer provides fastest, least-expensive access – Follow up and training to successfully complete the sale/deployment Derived from SIVA model, Chekitan & Dev © 2009 p28
  • 29. Amazon Kindle – Buy Books When, Where Access and How You Want Amazon Kindle – First introduced November 2007 – Download books via wireless Solution – iPhone Kindle app People Process Included Information – Wireless access (small fee overseas) Technology Services – Access to 360k book library – Device can hold 1500 books – Permanent virtual library at Amazon.com Strategy – Complete system – technology, content, delivery – Access content when and where you wish Kindle downloads first eclipsed computer downloads in July ‘09 © 2009 p29
  • 30. Access Access - Additional Examples Comcast uses Salesforce.com tools to monitor issues on Twitter. Go where the customers are. Salesforce.com enables users to buy SaaS apps via Appexchange. Apple enables users to buy iPhone apps from AppStore. SaaS or premise software? SaaS Pick one – not both. © 2009 p30
  • 31. Discussion Your experience? Q&A Thanks! © 2009 p31
  • 32. Steve Robins 10+ years in solution marketing – Expertise in product, solution and industry marketing – Experience: EMC Documentum, KANA, The Yankee Group and more Principal, Solution Marketing Strategies Founder, The Solution Marketing Blog Inbound Marketing Certified Professional If I can help you in any way, please let me know: s.robins@SolutionMKT.com SteveRobins1 www.LinkedIn.com/in/ www.Twitter.com/SteveRobins www.SolutionMarketingBlog.com www.SolutionMarketingStrategies.com www.barcamp.org/ProductCampBoston © 2009 p32
  • 33. Solution Marketing Best Practices Steve Robins Principal Solution Marketing Strategies November 7, 2009 © Solution Marketing Strategies, 2009

Editor's Notes

  1. Steve Robins [email_address]
  2. To get started… All too often we marketers think that our product or technology is THE answer to the customer’s problem. But it’s not. In fact, the customer needs much more than just a single product to solve their business problem.
  3. Customers also need to take into account… The people involved – how will they use this? The business processes involved Information …and the services and integration involved to plan, build and connect the system together. Taken together, this is a solution – as opposed to just a product. Today, more and more top software companies are marketing not just products, but broader solutions as well.
  4. Customers also need to take into account… The people involved – how will they use this? The business processes involved Information …and the services and integration involved to plan, build and connect the system together. Taken together, this is a solution – as opposed to just a product. Today, more and more top software companies are marketing not just products, but broader solutions as well.
  5. So here’s a definition… Solution marketing is The process of defining, educating, and providing access to complete and integrated solutions that deliver customer value by helping customers to solve their problems.
  6. You’re probably familiar with the 4 P’s of marketing – product, promotion, price and place. Well, when you work with solutions, you need to take a different approach to marketing. I call it SEVA and it’s based on work done by professors Chekitan Dev and Don Schultz several years back. The four key steps of solution marketing are solution, education, value and access. The first step is understanding the customer problem and defining the solution that solves the problem. Next step: educating the market about the problem and your solution, and engaging with prospective customers. The next element involves looking at the value provided by the solution. Value equals the customer benefit less the total cost of the solution. And finally, access – the ability for customers to purchase and use the solution successfully in the way that works best for them.
  7. Reference Frictionless sales - http://www.beyondvc.com/2008/08/selling-to-larg.html
  8. We’ll take a look at selected best practices for each element of SEVA: Solution We’ll see how Intuit’s solution approach knocked out a major competitor We’ll take a look at PowerAdvocate’s marriage of data and software Education We’ll look at HubSpot, which focuses almost exclusively on education rather than interruptive promotion. We’ll look at IBM’s social media policies to see how social media plays into education. Value We’ll look at the value of SAP and Oracle support – some very interesting lessons here And we’ll see one of the reasons for Microsoft SharePoint’s success against it’s mainline competitors Access Finally, we’ll take a look at the ways that Amazon, Comcast and Salesforce enable broad access to their solutions.
  9. Chart: http://www.publishersweekly.com/article/CA6686612.html
  10. The agenda. I’ll dig deeper into solution marketing, using the case studies to illuminate each of the key elements of solution marketing – solution – education – value – access Then we’ll conclude with Q+A and discussion.