THE MONETIZATION PLATFORM
Everything you need to win in the subscription economy.
INTEGRATIONS
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Over the past few years, the manufacturing industry has begun to embrace the seismic shift towards a consumption model that not only allows tech vendors to scale their businesses but also makes their financials risk averse. This shift towards achieving a predictable revenue model has also forced tech vendors to reprioritize. In order to increase margins, accelerate recurring revenue and directly benefit from the As a Service economy, some vendors are focusing on transforming their channel program to enable their partners to handle recurring revenue and bundle hardware, software, and services.
The push for this radical change is a response to a noticeable shift in business buyers’ behavior, that of flexibility in the way they consume technology. They want affordability, options, and the capabilities of “pay-as-you-go” services. As a result, tech vendors are now beginning to offer Anything as a Service (XaaS) bundles, such as Device as a Service, or Workplace as a Service, through their channel partners by including software and services alongside their core products. Check out more on how technology vendors are reaping the rewards of the As a Service economy in our White Paper.
According to a survey by TSIA, 50% of companies with transactional revenue models – models based on one-time selling of products – reported a churn of 10% or more in their bookings. In contrast, only about 23% of the companies that have adopted selling recurring services saw a similar drop. Even during the pandemic, vendors offering subscription models witnessed a deceleration in growth but not a decline in revenue.[1]
To benefit fully from the subscription model, it’s imperative for tech vendors to enable their channel partners that may lack suitable tools and processes. So, while these partners drive product adoption and integration, upsell and cross-sell their services, they need continuous support from vendors to customize their offerings.
As businesses migrate from transactional models to consumption models, the complexity in the integration of disparate IT systems on both the vendor and the provider side grows exponentially. As a result, the transition is often hindered by additional expense on resources, support, and maintenance. However, because the rewards from such a model are higher in the long run, organizations must not see this as a daunting exercise but strive to automate and unify their operations.
Unlike a linear supply chain, ecosystems form clusters around customer needs, and tech vendors aren’t untouched by this revolution. In a Forrester survey, 76% of the business leaders agreed that current business models will be unrecognizable in five years’ time. The main agent for this dramatic shift will be the adoption of dynamic ecosystems. Another Forrester forecast states that 17% of B2B transactions will flow via e-commerce and marketplaces by 2023.
Creating an ecosystem marketplace, however, has its challenges. Managing a diverse set of suppliers and processes, continuous interoperability issues, the complexities of developer programs and localization needs for diverse markets.
CloudBlue’s platform and network can help. Partners can integrate their hardware, software and services to create the final product within one platform and launch the offerings in multiple countries and currencies. Tech vendors can easily onboard resellers and distributors; manage catalogs and product listings; and processes for ordering, fulfilment and billing. This translates to minimal time to market and boosts ARR.