Lessons for the "Consumer Enterprise"
Sales techniques, product features and pricing approaches are being turned upside down as practices from the consumer market are applied to the enterprise software business.
By Joe Kraus, JotSpot
May 12, 2006
Moving from the consumer world to the enterprise world used to be thought of as a disadvantage. I thought so too. After years founding and running Excite more than a decade ago, my new venture, JotSpot, dumped me in the deep end of the enterprise software business.
But after a year running JotSpot, it became clear that my consumer experience was actually an advantage. The enterprise software industry was undergoing a revolution of its own. And the way enterprise software is bought, sold, adopted and used is looking more like the way a consumer product is developed and marketed, and less like the traditional business software model.
Don't get me wrong. I don't mean to claim that none of the "old" rules apply. But most software vendors - and startups in particular - cannot afford to operate with the traditional model that is used by most of the large vendors today.
It is time to do things differently. And most of what enterprise software vendors need to do differently can be learned from the consumer business.
The Melding of Business & Personal
The advance of the Internet is at the heart of the reason why enterprise habits are changing. Since the mid 1990s, the Internet has become increasingly pervasive in companies. It allowed for people at work to do a better job of blending their personal and work lives and improved their ability to multitask.
Before the Net, for example, workers needed to leave work to do personal errands. If you needed to shop or find information, you had to leave your office. Today, an office worker can buy online, research medical issues, find contact information for a friend, and then settle back in to work on a product plan or document - all without leaving his or her desk.
This new behavior of constant switching back and forth between business and personal online services has impacted expectations for business offerings. Now workers are exposed to a whole range of consumer services offered for free. As consumers, we can search "Inside the Book" at Amazon.com, access health information at WebMD, and use Google Earth to look at a friend's new house. All of these are cool, useful services that you don't have to pay for.
Suddenly, your enterprise software rep comes in and asks you to pay $1 million for a license. It is no surprise that at this point, many businesspeople scratch their heads and ask, "Wait, what am I paying for?"
But after a year running JotSpot, it became clear that my consumer experience was actually an advantage. The enterprise software industry was undergoing a revolution of its own. And the way enterprise software is bought, sold, adopted and used is looking more like the way a consumer product is developed and marketed, and less like the traditional business software model.
Don't get me wrong. I don't mean to claim that none of the "old" rules apply. But most software vendors - and startups in particular - cannot afford to operate with the traditional model that is used by most of the large vendors today.
It is time to do things differently. And most of what enterprise software vendors need to do differently can be learned from the consumer business.
The Melding of Business & Personal
The advance of the Internet is at the heart of the reason why enterprise habits are changing. Since the mid 1990s, the Internet has become increasingly pervasive in companies. It allowed for people at work to do a better job of blending their personal and work lives and improved their ability to multitask.
Before the Net, for example, workers needed to leave work to do personal errands. If you needed to shop or find information, you had to leave your office. Today, an office worker can buy online, research medical issues, find contact information for a friend, and then settle back in to work on a product plan or document - all without leaving his or her desk.
This new behavior of constant switching back and forth between business and personal online services has impacted expectations for business offerings. Now workers are exposed to a whole range of consumer services offered for free. As consumers, we can search "Inside the Book" at Amazon.com, access health information at WebMD, and use Google Earth to look at a friend's new house. All of these are cool, useful services that you don't have to pay for.
Suddenly, your enterprise software rep comes in and asks you to pay $1 million for a license. It is no surprise that at this point, many businesspeople scratch their heads and ask, "Wait, what am I paying for?"
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