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By Hank Barnes
For many technologies like computers, productivity software, and networking, SMBs have typically turned to regional or local solution providers for assistance, particularly during their early phase of adoption when more assistance is required (once an item is well understood and commoditized, SMBs will choose the least expensive buying approach, which is usually e-commerce). These solution providers have a cost structure designed for local support and provide personalized service to their SMB customers.
For the SMB, they get a level of attention that they need, without paying high fees for travel expenses and direct consulting resources. The solution provider gets a profitable relationship that they can benefit from through the years as they help their SMB customer leverage new technologies.
One of the hottest trends in the technology industry is software as a service (SaaS). The SaaS market is dominated by emerging vendors who are providing customers with a new cost model for software--on with no up front licensing or special hardware needed; all that’s needed is an Internet browser and pay as you use via a monthly subscription arrangement. While this changes the core approach to purchasing software, it does not change the fundamental need for support and assistance in getting maximum value from these solutions for the business.
Most SaaS vendors use an e-commerce model to sell their solutions. Part of this is driven by the fact that the revenue model does not lend itself to direct sales and part of this is driven by the nature of the technology—since you access it with a browser, why not just purchase a subscription the same way. As vendors get established, they are typically expanding beyond e-commerce with a direct sales and service force. The interesting thing is that most of those vendors are pushing to get larger and larger deals and competing with traditional enterprise vendors.
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