For Small SaaS Vendors, The Benefit Of A Free Tier Is To Attract Partners

Recently, I published a report about a small software-as-a-service (SaaS) vendor, Dimdim, which is having success in the crowded Web conferencing market. Like many small vendors, Dimdim provides a free service tier, generously allowing up to 20 participants into the free meeting, to help drum up business. The report, though, did not simply highlight the number of users that Dimdim has captured in four short years of existence -- over 5 million -- but also its success in attracting partners like Intuit, Novell and Nortel CVAS. Why? For new vendors entering crowded markets, attracting partners is vital for two reasons:

  1. Partners open doors to new markets. In crowded markets, incumbent vendors and new entrants jostle to serve customer needs. For the new entrants, the customers that can be wrangled through media hype and analyst buzz is minimal. Mass appeal comes from firms with strong working relationships with a range of buyers in a number of markets -- e.g., oil & gas, healthcare, government -- embracing a small vendor's offering and introducing it to their clients.
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Google Ends Wave: What Lessons Collaboration Tech Product Managers And Marketers Can Learn

Yesterday (August 5), Google announced that it was ceasing attempts to make Google Wave a viable standalone product. Considering the fanfare that the product received in the run-up to its general release (announced at Google I/O in May), it was no surprise the story burned across the blogosphere and the press. In following some of the Twitter traffic, what I found interesting was some of the low-level chuckling I saw from some competing vendors in the collaboration software space. Why? Well, before I get into that, let me make a couple of stipulations:

  1. Google has a history of less-than-stellar product launches. In tossing Google Wave on the scrap heap (and parceling out some of its components as open-source software), the brainchild of Lars and Jens Rasmussen joins a growing number of failed products. Some of this can be attributed to mistakes that Google has made time and again in marketing and product design (my colleague Tom Grant pointed out some of this with Google Buzz). But you also have to factor in that because Google has such a high profile, every time a product under performs it draws a lot of attention, making each failure seem large. But this does not seem to slow the search engine giant's innovation engine, which brings me to my second point.
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Social technologies: Standalone Applications Or Features?

During CScape at Cisco Live, one of the more interesting conversations I had started with a simple question: Is social software (and collaboration software in general) a set of standalone applications or features of other business applications? This sprang from a discussion on the future of the collaboration technology business and really speaks to a couple of important developments in the market:

 

1) Collaboration platform vendors incorporating social features into their offerings. Anyone who's followed my research and my blog posts knows this story: Cisco, IBM, Microsoft and Novell (amongst others) have released collaboration tools that include robust Web 2.0 technologies such as social networks, tag clouds and blogs. This has led to a maturing of the messaging of pure-play vendors - going from "we have the best social software" to "this is how we solve a specific business problem."

2) Business applications that power business processes are becoming social. Another recurring theme in my research is corporate interest in (and fear of not having) enterprise 2.0 technology has led business application vendors to jump into the market. As these vendors do so, they are seeking out tools to help them make their applications social. The inclusion of business application vendors, though, has put more pressure on the pure-play vendors to find a niche that will allow them to compete with vendors that have sure footholds in businesses.

 

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How Do You Demonstrate The Real Value Of Collaboration (Software)?

As I cruised the pavilion at Cisco Live in Las Vegas last week, the display that held my attention the longest was the Collaboration ROI booth. There, the network infrastructure provider making waves in the collaboration software market was demonstrating calculations it had done on how its various solutions were improving efficiency and productivity for specific jobs in verticals like retail banking. In the example I reviewed, banks using virtual loan officers were able to obtain more small business customers because the bank was able to have someone "there" to answer the prospective customer's questions. Now, with all the activity going on around me, why was this so fascinating? Put simply, it relates to a fundamental issue for all vendors hoping to compete in the collaboration software space: How do you differentiate in this crowded market?

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Thoughts On The Enterprise 2.0 Conference

In the wake of the Celtics' fourth-quarter collapse that gave Kobe Bryant his fifth ring, I am endeavoring to find positive things to focus on instead of post-game analysis, which brings me to the Enterprise 2.0 Conference. This was my second year attending the event (which is conveniently located 10 minutes from my house), and I must say that my takeaway this year is more positive than my impressions after last year's show. I appreciated the optimism exhibitors and attendees have about the market and the passion they show for the topic - which led to some lively debates. But during my three days at the event, the things that really caught my attention were:

 

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Help Us Benchmark “Social Maturity”

We recently embarked on a Forrester-wide research project to benchmark the use of social technologies across enterprise organizations. Why is this important? Well, as you may know, we cover social technologies from a wide range of perspectives – from roles in marketing to IT to technology professionals. We find that each of these roles differ in their general “social maturity” and that most companies are experiencing pockets of success, but few, if any, are successfully implementing it across the board. In fact, full maturity in this space could take years, but there are clear differences in how some ahead-of-the-curve companies are using social technologies for business results. In fact, at this point it has been clearly established by many people (including us many times over) that social technologies are transformative tools that are changing the way companies do business. So we’re not talking as much about the opportunity social presents, but rather we are trying to determine the current reality of practitioners. It’s also clear that many companies have made tremendous strides in planning and organizing for the use of social technologies. However, the one question we consistently get is: “Where is my organization compared to others in the use of social media?”  We want to benchmark these companies to see if we can answer questions like:

 

  • How do you define “social maturity,” and why is it important to get there?
  • Which companies are ahead of the curve in implementing social technologies for both external use (i.e., for customers/consumers) and/or internal use (i.e., for employees/partners)?
  • What have been the biggest drivers of success?
  • What are the biggest challenges?
  • What steps do most organizations need to take, and why?
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Do All Business Applications Need To Be Social?

Next week, vendors from across the social computing landscape will converge on Boston for TechWeb’s Enterprise 2.0, a business Web 2.0 conference and trade show. In advance of this event – which I will be attending – I thought I’d discuss a topic that has started to emerge in my research of social software: the proliferation of social components in business applications. More specifically, I want to address a question a client recently raised: is having a social layer going to be necessary for businesses to adopt business applications going forward?

Over the last few years, we have seen software vendors position social tools as part of software suites such as collaboration platforms (e.g. SharePoint 2010, Lotus Connections), project management packages (e.g. ThoughtWorks Mingle),  BPM tools (e.g. ARISalign) and CRM systems (e.g. Salesforce Chatter). This is the natural reaction to what seems to be heavy business interest in these technologies: 65% of firms deploy at least one Web 2.0 tool. However, the marketing and selling of these tools is predicated on two myths:

  • Myth #1: Information workers are clamoring for these social tools. I have sat in on many vendor briefings where a company representative tells me employees demand Facebook-like or Twitter-like tools to do their jobs. Not true. When we ask information workers about their use of social networks, wikis, discussion forums, blogs, and microblogs for work, only a small group actually uses them; social networking tools, the best-adopted technology, is used by only 12% of information workers. When we ask non-users their desire in using each of these tools, small portions express interest; the most sought-after technology, discussion forums, only piques the interest of 15% of information workers.
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Where Does Web Conferencing Technology Make Sense?

Last night I had the pleasure of attending the Citrix Online Executive Meet-Up here in Boston; as an East Coast-based technology analyst, I rarely see the vendors I cover in person without hopping on a plane. For those unfamiliar, Citrix Online is the maker of popular remote access and Web conferencing technologies GoToMyPC, GoToAssist, GoToMeeting and GoToWebinar. The centerpiece of this event was a customer panel exclusively made up of marketing professionals who use the conferencing technologies for customer and channel interactions. It was a fact I made sure to jot down in my notebook – why such a marketing-heavy panel? This prompted a broader question: are sales and marketing the real killer applications for Web conferencing?

A myriad of companies occupy the Web conferencing market, offering solutions that address four basic use cases:

  • Ad hoc meetings: collaborative sessions that need to happen on short notice. These could be quick screen sharing/document sharing sessions, technical support or demonstrations.
  • Formal meetings: planned sessions with formal agendas that are centered on a group considering one or more pieces of content.
  • Large & small group presentations: more formal events where a presenter addresses a group of some size with varying degrees of interactivity.
  • Training sessions: educational sessions where participants get information, have interactive learning sessions and can be tested on content.
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Elaborating On The Technology Libertarianism Theme: Some Observations On Two IT Organizations

Last week, Forrester held its annual IT Forum in Las Vegas with the interesting theme, “The Business Technology Transformation: Making It Real.” Gathering together a group of IT professionals and vendors interested in how business leaders will insert themselves into technology decisions, it provided a perfect opportunity for me to discuss Technology Libertarianism – my shorthand for IT departments that take a hands off approach to technologies workers want to use to do their jobs. On the floor of the conference I talked to an IT professional at a large, national non-profit organization and two information workers from at a public corporation providing a popular software-as-a-service application.

The conversation with the IT professional centered on his organization’s need for standardization: they were making efforts to have a homogeneous computing environment for the purposes of having greater control. During our talk, we discussed the influence an end user could possibly have over applications and hardware. His thoughts? While the end users in his organization needed a standard set of applications, and they needed to control the desktop environment to ensure delivery of said applications, he could see the potential of not having to standardize smartphones. When I introduced the idea of virtual desktops to push applications or software-as-a-service, which would allow him not to have to standardize the desktop, he did concede those are interesting ideas. However, he needed to see more evidence that these could be effective solutions for his organization.

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Technology Libertarianism: The Hands-Off Approach To IT That Fuels Technology Populism

One of the themes of my research has been how information worker adoption of technology in general, and collaboration technology specifically, affects IT decision-making. Inevitably, this has led me down the path of studying the phenomenon of rank-and-file employees provisioning their own technology outside the auspices of IT – a phenomenon Forrester labels Technology Populism (though I won’t kick if you want to call it “consumerization of IT”). Very shortly, I’ll be publishing a report that shows not only is Technology Populism a reality, but that it is affecting how technology is officially adopted by businesses. What our data shows is that sizable portions of the information workforce played a role in the selection of their desktop computer (13%), laptop computer (33%) and smartphones (66%). This got me thinking about what this means for technology decision-making in business.

We at Forrester often talk about the transition of IT to BT (Business Technology) – which is our shorthand for talking about lines of business taking a central role in the selection and management of technology. It reflects a need for technology decisions to be oriented toward business outcomes and for business leaders to have greater say in picking the tools their employees use. But this is still a high-level story: it is a tale of executives picking technology for the end user. Technology Populism is specifically about end users taking on this role; and that businesses are seeing benefits (re: cost savings) in allowing this suggests that there may be another concept here beyond IT to BT.

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