A winning formula for SaaS

by admin on January 15, 2007

in Cloud Computing/SaaS

In a recent Sandhill.com article, Marc Benioff, CEO of Salesforce.com, poster child for SaaS said:

We knew from the very beginning that we wanted to sell a service that made sales force automation as easy as buying a book on Amazon.com. That meant customers had to love to use it. And our subscription-based business model meant that they had to succeed.

Benioff’s strapline is: ‘The end of software.’ A smart piece of PR BS but it has drawn a lot of attention. Today, Benioff is sitting on a $500 million pa business. That makes his company one of the top 40 software vendors in the world by revenue. So SaaS is important. Well yes, but only if executed as something new and not, as Phil Wainewright is fond of saying: SoSaaS. (Same old Software as a Service). Which in turn made me think about design.

In order for something to be well designed it needs to meet two simple criteria. It should:

Do no more than the user needs

Provide the user with an attractive and intuitive interface

One interpretation might be that Salesforce.com’s success has little to do with it being a SaaS player per se. The combination of SaaS pricing models – i.e. rental – plus a need to get customers behind the company meant that designers were forced to recognise customer requirements from the get go.

When considering client computing needs, I wonder how many practitioners stop to think about these points? Isn’t it the case that by and large, we don’t consider that while we may be well used to the manner in which we expect an accounting programme to look, we don’t stop to think what the user would prefer?

At least one practitioner has said to me that recommending stuff like Freshbooks is short changing the client because it doesn’t deliver a full set of books. Spot the fatal flaw in this kind of thinking? From Freshbooks’ perspective, it’s about the client, not the practitioner. That might explain why they grew by some 66% in less than 6 months last year, to 100,000 subscribers, 9% of whom are in the UK with about 6% in Australia. It might also explain why Tom Raftery’s podcast with Michael McDerment, Freshbooks CEO, is way better than anything I could have done.

PS: Last Friday’s SFdC outtage, as reported by David Berlind, must have been a royal pain in Benioff’s backside. But that would be to under-estimate the amount of work that goes in to keeping the ‘lights on’ in SaaS operations. Vinnie Mirchandani talks about this as an issue in the deals he negotiates. the comments are particularly illuminating. These are mostly on-premise deals. OK – so Vinnie plays with the Big Boys. But the same principles apply to the SMB players.

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