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2011 Top 10 SMB Technology Market Trends January 18, 2011 Laurie McCabe, Partner SMB Group www.smb-gr.com
2011 Top 10 SMB Technology Market Trends
January 18, 2011
Laurie McCabe, Partner
SMB Group
www.smb-gr.com
2011 Top 10 SMB Technology Market Trends
1. Mobile Commerce Lifts Off
2. SMBs Demand Order for Social Media Chaos
3. Apps Stores Become a Key Information Source
4. The Shift to Cloud Computing Becomes Irreversible
5. A New Cloud Channel Model Forms
6. Transitioning to the Insight Economy Gets Easier
7. Tablets Add Fuel to the Mobile App Explosion
8. Integration Becomes a Key Business Solution Differentiator
9. Hybrid Computing Accelerates Virtualization
10. Continued Convergence of Communication and Collaboration
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Top Challenges for Small and Medium Businesses Top business challenges 1. Growing revenues
2. Attracting new customers
3. Improving cash flow
4. Maintaining profitability
5. Reacting quickly to changing market conditions
Top technology challenges
1. Get better business insights from existing data
2. Figuring out how different solutions can help the business
3. Implementing new solutions and upgrades
4. Integrating social media with Web site, marketing tools, etc.
5. Keeping my systems up and running
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(Source: SMB Group 2010 SMB Routes to Market Survey)
1. Mobile Commerce Lifts Off
We’re going mobile… • Mobility market will reach $1 trillion by 2014
• 37% of US smart phone users have made a purchase on handsets in last six months
o 19% purchased music
o 14% bought books, DVDs or games
o 12% have purchased movie tickets
• 32% of Android and 29% of iPhone users willing to spend $100+ from their handsets
• 27% of all consumers used mobiles to browse and research products at 4x/12 month period.
• Mobile payments market expected to quadruple by 2014 to $630bn--5% of total ecommerce sales
• SMBs will enable mobile commerce to build business and grow revenues!
With the Internet in our pocket or
purse, it’s only a matter of time
before mobile commerce really
takes off.
(Sources: Gartner, ATG, Juniper, ABI, comScore)
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SMB Use and Plans for Mobile Transactions
Source: SMB Group, 2010 SMB Mobile Solutions Study
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22%
23%
23%
24%
28%
31%
31%
32%
38%
40%
40%
42%
28%
24%
34%
44%
35%
35%
42%
37%
39%
42%
42%
42%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90%
Makepayments/transfers to
third parties
Deposit/withdraw/transfer funds
Manage/administertransaction accounts
Log and track productand/or service
requests
Check invoice status
Paybills/invoices/balances
Pay for products,goods, or services
Check delivery statusof my orders
Shop/buy products
Sharing--post pictures,documents, etc
SMS contact the salesor support contacts
Add/view/changepersonal information
% Valid Cases
Current Plan
Small Business
Sample Size = 570
2. SMBs Demand Order for Social Media Chaos
Did you know???
• More than 3.5bn pieces of content (web links, news stories, blog posts, etc.) are shared each week on Facebook
• The average number of tweets/day was over 27.3m—in 2009—adding up to 10bn/year
• 70% of bloggers are organically talking about brands on their blog.
• 84% of consumers say online reviews influence purchases
• More than 700,000 local businesses have active Pages on Facebook
Social media volumes and
venues are multiplying—
word of mouth on steroids!!!
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SMBs Demand Order for Social Media Chaos How much time do you spend to to track, converse, monitor and manage your company’s presence and brand???
• Create content in multiple places, monitor and scan views, respond on different sites, etc.
• Track and analyze online listings, comments, ratings, reviews, etc. about your business and your competitors
• Scan Twitter followers for conversations to join
• Check RSS feeds
• Check Google Alerts
• Create and monitor relevant communities and topics
Social Media Management
helps you bring order to
the chaos!!!
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SMBs Demand Order for Social Media Chaos
Social media management solutions help you to manage incoming and outbound online interactions more efficiently
•Save time by managing and integrating customer interactions across multiple social media venues and with other marketing activities (web site, search engine marketing, email marketing, etc.)
•Gain a more unified view of your customers and marketing
•Drive more business with social and online marketing investments
•Spot new opportunities and areas that need improvement
•Benchmark yourself with competitors
BatchBlue “social CRM”
HubSpot inbound marketing
Marchex Reputation Management
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3. SMB App Stores Become a Key Information Source and Channel
“Figuring out how technology solutions can help my business” is the #2 technology challenge
• Sorting through different technologies, geek-speak and hype is tough
• Today: SMBs turn first to search engines, vendor emails and vendor websites
Application stores help streamline the discovery, evaluation and selection process for business apps
•One-stop shop to find, try and buy
•User-generated reviews, rankings
•Expert commentary, tips, advice and resources
•Find apps that work with those you already use
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SMB App Stores Become a Key Information Source and Channel
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(Source: SMB Group 2010 SMB Routes to Market Survey)
4. The Shift to Cloud Computing Becomes Irreversible
• Cloud infrastructure will grow to $116.5 B by 2014: Forrester
• 20% of all businesses will own no IT assets by 2012: Gartner
• Global cloud computing market will to 121.1B in 2015: MarketsandMarkets.com
• “Hockey stick growth for cloud computing”: Steve Ballmer, Microsoft
Cloud Computing Survey Points to
Arrival of 'Cloud Thinking'
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The Shift to Cloud Computing Becomes Irreversible
Customers
“Faster, cheaper, easier”
• Eliminates capital investments for infrastructure
• Eliminates ongoing technical management and update costs
• Reduces financial risks
• Reduces requirements for internal IT expertise
• Speeds time to solution value
• Increases vendor accountability
• Evolves more flexibly
• Provides connectivity and collaboration advantages
• Focus on business results
Vendors
“New revenue streams, efficiencies”
• Penetrate new markets reducing costs and technology barriers
• Predictable recurring revenue stream
• Provides a real-time pulse on customer behavior and requirements
• Enables cross-selling opportunities
• Reduces support calls and costs
• More manageable upgrade cycle
• Capitalize on economies of scale and skill
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The Shift to Cloud Computing Becomes Irreversible
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0%
5%
8%
9%
10%
20%
0% 5% 10% 15% 20% 25%
Acctg., Financial, ERP
Collaboration
Web site design/hosting
Contact and customer management
Business Analytics
Online Marketing
Valid Cases %
9%
10%
25%
25%
27%
27%
0% 5% 10% 15% 20% 25% 30%
Acctg., Financial, ERP
Web site design/hosting
Business Analytics
Contact and customer management
Collaboration
Online Marketing
Valid Cases %
Small Business
Medium Business
(Source: SMB Group 2010 SMB Routes to Market Survey)
Percentage of respondents using cloud solutions:
5. A New Cloud Channel Model Forms
Traditional Software Channel Model
• Indirect channel is an integral part of sale, delivery and support of on-premise business software
• Complements software developer with sales, implementation, support and service
• Little overlap between software develop and channel roles
Cloud Solutions Channel Model
• Doesn’t align with traditional software/vendor channel roles
• Cloud vendor delivers much of what IT channel traditionally provided (sourcing, installation, management, etc).
• Blurs the line between software developer and channel roles
Software Developer
End-user Customer
Traditional IT
Channels
Cloud Channel
New
skills?
Smaller deal size?
Less
upfront $$?
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A New Cloud Channel Model Forms
• Cloud vendors have focused on direct sales to establish growth and demonstrate viability
• But--direct sales alone can’t fuel the future growth curve
• The cloud and SaaS eliminate/reduce technical barriers to adoption—but customers still need help to:
o Evaluate and select the “right” solution
o Tailor the solution
o Integrate legacy and third-party solutions
o Adapt business processes
o Train people
Cloud vendors can effectively penetrate the
market through direct Web channels alone
Myth!
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A New Cloud Channel Model Forms
Vendors
• Authentic channel commitment
• “Right sized” partner programs to avoid channel conflict
• Collaborative approach
o Quotas jointly determined
o Reward renewal as well as sales
o Marketing and sales programs
o Billing models
o Joint customer service tools
• Compensation geared to different partner types
o Referral commission only, upfront + annuity, etc.
Channel Partners
• Think solutions, not products− from solutions reseller to solutions catalyst and “trusted advisor”
• Extend the solution with opportunities to resell, develop and integrate additional functionality
• Adjust the business model
o Prepare for smaller deal sizes and faster deployments
o Align skills, metrics, etc.
o Plan for different cash flows
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6. Transitioning to the Insight Economy Gets Easier • 1.2 zettabytes of digital information
will be created in 2010
• A zettabyte is 1,000,000,000,000,000,000,000 bytes (that's 21 zeroes!)
• Online video, social networking sites such as Facebook, digital photography, cell phone data all contributing to the data pile-up
• Annual amount of bytes we collectively produce forecast to soar 44X over the next decade
(Source: 2010 IDC and EMC study)
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Transitioning to the Insight Economy Gets Easier
“Information is not knowledge.” − Albert Einstein
•“Information overload” (Alvin Toffler) refers to the difficulty a person can have understanding issues and making decisions because of TMI--too much information
•#1 technology challenge for SMBs: “Getting better business insights from the data we already have”
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(Source: SMB Group 2010 SMB Routes to Market Survey)
Transitioning to the Insight Economy Gets Easier
• Until recently—BI has usually been too complex and expensive for most small businesses
• New on-demand BI geared for SMBs
• Help measure and manage the business
• Interactively slice and dice data for “what-if” scenarios
• Streamline data collection, analysis and reporting
• Get everyone “on the same page”
• Help you zero in on a specific task—financial analysis, spend analysis, pipeline management, online marketing, etc
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7. Tablets Add Fuel to the Mobile App Explosion • A majority of SMBs already
use smartphones
• SMB tablet adoption--In less than one year (e.g. iPad, Dell Streak, etc.) is already strong:
o 10% of small businesses are using tablets
o 22% of medium businesses are using tablets
Mobile App Stores Use and Plans
20%
22%
16%
15%
16%
11%
55%
54%
52%
10%
9%
22%
0% 20% 40% 60% 80% 100% 120%
Google Android Apps MarketPlace
Apple iTunes AppStore
RIM Blackberry AppWorld
My company already uses Aware and planning to uss
Aware, but no plans to use Not aware of this
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Source: SMB Group, 2010 SMB Mobile Solutions Study
Tablets Add Fuel to the Mobile App Explosion
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Small Business
25%
30%
30%
31%
32%
35%
35%
37%
39%
46%
50%
65%
30%
21%
40%
29%
27%
28%
34%
29%
33%
36%
34%
21%
0% 20% 40% 60% 80% 100%
Fleet asset tracking
Employee payroll
Mobile marketing and advertising
Payment processing
Supply chain integration/inventorymanagement/Direct store delivery
Sales force automation applications
Business analytics
Social media marketing
Delivery & shipment applications (order& shipment tracking, etc.)
Time management & time capture
Field service applications
Customer management
% Valid Cases
Current
Planned9%
14%
17%
17%
21%
23%
25%
25%
29%
31%
33%
53%
14%
24%
22%
42%
29%
19%
26%
31%
29%
33%
36%
35%
0% 20% 40% 60% 80% 100%
Fleet asset tracking
Supply chain integration/inventorymanagement/Direct store delivery
Sales force automation applications
Mobile marketing and advertising
Business analytics
Employee payroll
Payment processing
Field service applications
Delivery & shipment applications(order & shipment tracking, etc.)
Time management & time capture
Social media marketing
Customer management
% Valid Cases
CurrentPlanned
Medium Business
Sample Size = 143 Sample Size = 570
Source: SMB Group, 2010 SMB Mobile Solutions Study
8. Integration Becomes a Key Business Solution Differentiator
• Cloud computing gives SMBs an easier, more affordable and manageable way to deploy and use business and collaborative apps, social media, payments gateways, etc.
• Data stores are growing
• Challenge is to get apps to “talk” to each other—synchronize, exchange and share information and processes
• But integration has remained a challenge
o Cloud-to-cloud
o Cloud-to-on premise
• Often complicated, expensive, and one-off
Ratchets up the need for
simpler, cheaper integration
alternatives!
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Integration Becomes a Key Business Solution Differentiator • SMBs require turnkey integration to
gain full value from technology solutions
• SMB integration options are growing
o Comprehensives integrated business suites
o Solutions that come with embedded integrators for common integration scenarios
o App stores that streamline integration among participating solutions
o On demand turnkey integration services and marketplaces
o Integration appliances
• Integration will become a make or break factor in “short list” decisions
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9. Hybrid Computing Requirements Accelerate Virtualization Adoption
• Top data center priorities:
o Agility
o Managing resource capacity better
• Top business trends affecting data centers:
o Increase in apps and data
o Security and risk management
o Need to reduce costs
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Hybrid Computing Requirements Accelerate Virtualization Adoption
• But vendors will need to invest to educate SMBs about cost savings, management and provisioning benefits
• Help overcome concerns about security, stability and management of virtualized environments
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10. Continued Convergence of Communication and Collaboration Solutions
• Online collaboration suites and hosted unified communication solutions integrate pieces of the collaboration puzzle
• Makes it easier to find, share, manage and use information, locate and connect with the people you need when you need them.
• Delivered as web-based services
o Login using a web browser
o Monthly or annual per user subscription pricing model
Online Collaboration Suites
Email, IM
Soft phones ,
VoIP
Calendars
File sharing
Document mgt.
Workspaces
Web conferencing
Wikis/Forums
Real time feeds
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Continued Convergence of Communication and Collaboration
• Collaboration is the only business activity that every employee engages in every day
• Share and manage info, ideas, resources and connections more effectively
• Make the business more efficient and productive
• Plans to adopt new collaboration solutions
o 20% of small businesses
o 32% of medium businesses
(Source:SMB Group 2010 SMB Routes to Market Survey)
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2011 Top 10 SMB Technology Market Predictions
1. Mobile Commerce Lifts Off
2. SMBs Demand Order for Social Media Chaos
3. Apps Stores Become a Key Information Source
4. The Shift to Cloud Computing Becomes Irreversible
5. A New Cloud Channel Model Forms
6. Transitioning to the Insight Economy Gets Easier
7. Tablets Add Fuel to the Mobile App Explosion
8. Integration Becomes a Key Business Solution Differentiator
9. Hybrid Computing Accelerates Virtualization
10. Continued Convergence of Communication and Collaboration
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Q & A
Laurie McCabe
www.smb-gr.com
SMB Group
About SMB Group
• SMB Group is a industry research, analysis and consulting firm that focuses on technology adoption and trends in the small and medium business (SMB) market.
• We help our clients to successfully:
o Identify market trends and opportunities.
o Understand and segment the SMB market, and the technology solution adoption drivers and inhibitors.
o Evaluate and act upon competitive threats and disruptive trends. o Develop more compelling messaging. o Position solutions for growth and competitive advantage. o Identify emerging market trends, technologies, solutions and their
impact on the SMB market and ecosystem. o Develop SMB market segmentation models
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