How Does the Cloud Affect Software Resellers?


Share on LinkedIn

Cloud computing is being heralded as the next revolution in software. With customers perceiving the benefits to be cost savings, decreased need of IT services and simplified customization, it can be hard to downplay the need for cloud solutions.

There are risks though. Concerns about security, uptime reliability and long term sustainability come up whenever the topic of cloud is breach. And sure cloud computing isn’t perfect… not yet. That’s the brilliance of cloud solutions, fixes are made quickly and everything is updated in real time. Experts are saying that eventually everything will be done in the cloud. This is where software resellers need to pay attention, because cloud computing, even with its downfalls, isn’t going anywhere. It is better that you educate yourself now and discover the rules before it gets too late to adjust your business model.

IDC predicts that “In 2012, 80% of new commercial enterprise apps will be deployed on cloud platforms.”

To prepare yourself you need to understand these core truths:

  • Businesses see the value in using cloud solutions.
  • As a software reseller you will need to participate in the cloud computing sector.
  • You will lose revenue on services. Cloud implementation isn’t as difficult as on-premise.
  • The sales-cycle for cloud solutions is much faster (by about 2/3) and the methodology is very different from the on-premise model. Your cost-of-sale needs to decrease.
  • You NEED to understand the right way to sell cloud solutions or you won’t know what hit you.
  • Your sales team won’t be able to figure it out on their own; habits are engrained from years of on-premise selling.
    The way you’ve been doing business for the last 20 years is over.

The market has changed and on-premise software solutions are heading the way of the typewriter. If you’re reading this post then you’ve likely already realized this; but you don’t know what you need do to succeed in this new market. What steps do you take to adapt, to evolve, your software reselling business?

The road to success comes from altering the way you think. You will need to adjust your sales team and if you think you can have your existing reps selling cloud at the same time they’re selling on-premise you can be assured you won’t benefit from this set-up. Consider finding one sales representative that ONLY focuses on selling cloud solutions. Your existing compensation model will drive you to bankruptcy so contemplate finding a better fitted model that reflects paying out on the number of seats signed as opposed to a percentage of the deal.

The most important adjustment you need to make to your sales cycle in the cloud? You need to shorten it by about 2/3rds. All the flashy demo’s that your sales reps once did to entice customers to sign deals will need to be compiled beforehand and put on your website within prospects reach. Consumer behavior has changed in a way that they are first educating themselves about your offerings; be attuned to this change in the market and optimize your website for selling cloud solutions.

Ultimately, you will need to make adjustments to your entire business strategy if you want to survive the transition to the cloud.

For more information take a look at this How To Survive In the Cloud Infographic.

Karin Wilson
Software ThinkTank
Managing Editor of Software ThinkTank, Karin Wilson, brings a keen ear and thought for getting the real story behind the voice to this website. She has worked for more than 20 years as an editor, radio producer, writer, columnist and broadcaster. Her work has appeared in numerous magazines and newspapers across North America. Karin helps the Software ThinkTank readership get the best bang for the buck out of today's complex software solutions through innovative thinking and practical application.


Please use comments to add value to the discussion. Maximum one link to an educational blog post or article. We will NOT PUBLISH brief comments like "good post," comments that mainly promote links, or comments with links to companies, products, or services.

Please enter your comment!
Please enter your name here