Transition from “Product > Channel > Customer”
to “Customer > Product > Channel”
is accelerating in B2C & B2B, changing how we partner and deliver value.
🏆 #1 Amazon Leadership Principle
It took some time for the rest of the world to catch up with what is core of Amazon mindset.
“Leaders start with the customer and work backwards. They work vigorously to earn and keep customer trust.”
This “thinking backwards from the customer” framework is now more important than ever.
Everything starts with the value we bring to a customer. Channels are key too, but ultimately they are a way to deliver this value.
✔️ Who: Customer needs
✔️ What: Value you deliver
✔️ How: Channels
In the case of B2B, smart channel partners are recognizing this rapid shift and re-focusing on “What” value they add to customers.
🎯 Cloud Marketplaces as a Customer-First Forcing Function
The rise of cloud marketplaces accelerates this shift dramatically. By reducing transaction fees to a mere 3%, the message is clear: the value of the resell channel is capped at this percentage.
This compels a reevaluation of the unique value each partner brings to the customer, beyond just facilitating transactions.
💡 Jay McBain, Chief Analyst at Canalys, explained this shift at our recent event, How to Unlock the Next-Gen Cloud GTM.
“Now the big marketplaces have all come together and said the value of resale is 3%. The same as a credit card swipe in consumer.
So all the money to collect on behalf of a vendor, the time value of money, waiting net30, net60, net90 for the money, the risk that the customer is not going to pay after that … that entire cycle that's been around forever is only worth 3%.
📍 It's not worth 40%, which we paid in the 80s,
it's not worth 30%, we paid in the 90s,
it's worth 3%.
So if you're going to do other things as a partner, which you do:
do value added partners, do the consulting, the design, the architecture, the configuration, the implementation, the integration -
there are hundreds of other services, but it's not paid for at the point of sale anymore.
And what a marketplace effectively does to a new educated younger buyer is break it out into line items.
I'm okay paying for consulting, I just want to see how much. I want to see that as its own thing. And I want to compete for that later.
And if somebody is doing these particular things, now I understand more of how the economics of the product purchase work as well.”
This recalibration to a customer-first strategy and streamlined channels like marketplaces changes the partnering models. It also makes transparent the costs/value of each service and empowers buyers to make better decisions.
__________
📈 Accelerate your Growth in Cloud Marketplaces
Transform your marketplace strategy with first-hand insights from Cloud GTM leaders in our 5-week cohort course. Learn in a community of great alliance leaders. Join 100+ alums from companies like GitLab, Darktrace, IDC and others.
Comments