Cloud services have become the foundation of enterprise computing. Migrating enterprise resources to the cloud gives corporations more agility and cuts costs. To add a new enterprise application or more data storage, you simply add more cloud capacity. If you are selling enterprise services, then you must include cloud services and cloud service providers in your sales strategy.
Cloud-based services have become a primary concern for IT and business managers. In one 2021 survey, 99 percent of respondents reported they use at least one public or private cloud in some way, and 77 percent of enterprises have a dedicated cloud team or cloud center of excellence. The survey also found that 36 percent of enterprises spend more than $12 million a year on cloud services.
No wonder resellers and IT consultants want to make cloud computing part of their sales offering. If you are offering business-critical computing solutions, then cloud services must be part of the mix.
The Era of Everything as a Service
When cloud-based services started to take off, initial conversations were around software as a service (SaaS). SaaS implementation is ideal for enterprise users since it offers all the features and functions of on-premises applications but without the need for on-premise computing hardware and data storage. The applications run in the cloud, providing turnkey access to software from any browser. SaaS is fast to deploy, requires little or no in-house resources, and demands less IT management.
Today we see the evolution of everything as a service (XaaS) as the enterprise infrastructure migrates to the cloud. We now have function as a service (FaaS), business process management as a service (BPMaaS), IT as a service (ITaaS), and even ransomware as a service.
When you are selling enterprise technology, you can think of XaaS as variations on the three basic cloud-based services:
Software as a Service (SaaS)
SaaS is one of the most basic forms of cloud services. This is a hosted enterprise software model where applications are made available over the internet. Corporate customers usually license SaaS applications as a subscription, purchasing enough seats to meet their needs. SaaS applications are completely cloud-hosted, so the customer only has to log in from a web browser; data, servers, storage, virtualization, and networking are handled by the SaaS provider.
Platform as a Service (PaaS)
PaaS offers cloud computing services that supplement enterprise resources. With PasS, the customer licenses hardware and software tools over the internet for applications such as software development. Rather than managing in-house resources, developers can use hardware, software, and storage in the cloud. PaaS is attractive since it provides the computing resources you need when you need them, and most services are pay-per-use, so there is substantial cost saving.
Infrastructure as a Service (IaaS)
IaaS provides computing resources via the internet such as storage, servers, and networking. IaaS is a cost-effective way to host your data center in the cloud, using virtual machines for computing. IaaS can make workloads faster, easier to manage, and more cost-efficient.
SaaS vs. PaaS vs. IaaS
Appreciating the differences between SaaS, PaaS, and IaaS is important for enterprise sales. The biggest difference between these services is how much you must manage. SaaS is completely managed in the cloud. PaaS provides all the resources you need to run your own applications and store data. With IaaS, you are still responsible for applications, data, middleware, and the operating system while the IaaS provider handles servers, storage, networking, and virtualization. Your enterprise sales opportunities are dictated by the type of cloud services.
Perfecting a Cloud Sales Model
Helping customers choose the right cloud computing services depends on their needs.
If the customer wants an alternative to on-premise systems, IaaS offers:
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More control over the infrastructure while outsourcing servers and storage
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More scalability, making it easier to change the infrastructure to accommodate growth in network traffic
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More stability, reliability, and support, since the service provider handles the hardware, including upgrading hardware and troubleshooting
If the customer is looking for hardware and tools to simplify development and deployment, then PaaS may be the answer since it offers:
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A hosted platform that includes servers, networking, databases, and everything you need in a hosted platform for application development and testing
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The ability to support multiple, geographically dispersed developers working on the same project
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Lower costs and easy-to-access resources to develop and deploy an application
When it comes to selling cloud services, you should understand the features and benefits of your cloud partners and their revenue models. Unlike enterprise software sales, IaaS and PaaS tend to use a pay-as-you-go or subscription pricing model, which means you must adjust your sales strategy accordingly. You also must revise your internal revenue model to determine how to maximize profits from selling cloud services.
Selling cloud services also demands new metrics for measuring sales success. Subscription revenue is generated over time rather than when the contract is signed, so sales revenue is stretched out over time as well. Many cloud sales teams are measuring success in terms of new customer acquisitions and monthly recurring revenue, which provides an incentive to reduce customer churn as well as bring in new business. For example, Microsoft compensates its Azure sales team by measuring customer success and the use of Azure cloud services.
MarketStar Understands Cloud Sales
For cloud sales, it makes more sense to measure sales success against the two factors that affect cloud sales profits:
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The cost of customer acquisition
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Customer lifetime value (LTV) or contribution to profits over time
MarketStar can help control customer acquisition costs and increase LTV. Outsourcing lead qualification to a sales-as-a-service expert such as MarketStar saves money by eliminating leads that will waste sales time and resources. MarketStar also understands cloud selling, which means we not only qualify prospects but can also guide them to the right types of cloud resources.
Customer churn is the biggest threat to ongoing cloud revenue, and MarketStar has the expertise your sales team needs to reduce churn and increase LTV. For example, we have sales engineers on staff who can bring the technical expertise you need to close a deal and to help develop a roadmap to ensure the customer sees ongoing ROI. You need a strong customer success team to assist with onboarding and work with customers, outsourcing customer success to a company like MarketStar is a proven strategy for reducing customer churn.
To learn more about cloud sales strategies and how MarketStar can help build your cloud sales, be sure to check out our infographic, “Crushing it with Cloud Sales.”
