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09 Feb 2010
SaaS strategy has an emphasis on proving value in the first 90 days. It is therefore necessary to modify your sales model, commission structures, and compensation plans.
With SaaS, commission is by ongoing customer use and revenue, rather than licence sales. Dealing with renewals and churn is especially relevant and should be built into the wages of sales staff.
The SaaS provider should supply sample commission plans for channel guidance to help resellers offer a deal that suits each customer.
The development of general or customer-specific software that sits on a shared platform requires more up-front resources than packaged software. And it may require solid SaaS-platform-specific skills.
The contract strategy and duration of contracts need to be reviewed together. Mixed contracts with traditional and SaaS elements must be examined, with clear Service Level Agreements (SLAs) including termination and migration conditions.
Security, data privacy, data use and legacy account transition should also be reviewed, and again the SaaS partner can provide the reseller with examples to guide them.
With SaaS, bills are generated dynamically based on the user count and the amount of services used. Remote server diagnosis should also be replaced by system and network monitoring, focusing on the risk of failure – as one outage or crash may affect the entire customer base.
SaaS customers reviewing their SLAs will look to the channel partner for confirmation of how those service levels will be achieved. Channel partners in turn are likely to need the support of their SaaS provider here.
SaaS providers with the right skills and infrastructure should be able to give the sector a rapid start that will increase the number of services and the average spend per customer. Tight integration and simple billing will boost take-up, while clear differentiation between SaaS and software as a product should help generate sales.
Chris Baldock is managing director at intY
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