28 September 2020
One of the main challenges with selling B2B software solutions is that your customers have existing applications and are reluctant to use your solution until you integrate with their systems. Additionally, they see integration as a benefit to you as much as it is to them and may be reluctant to pay for the full cost of integration.
This is a non-trivial problem because, for each customer, you may have to integrate with several systems, and across your customer base you may need to integrate with hundreds or even thousands of different systems.
To solve this problem, you have a three paths available to you, each with its own benefits and drawbacks.
Build custom integration points and own the IP: In this path, you build and maintain custom integration points for each of your customers.
Benefits: You own the integration. This is your intellectual property and you can customise it to suit each of your clients.
Drawbacks: You support the integration. You need to build it and maintain it which consumes development resources that may be better spent working on your core platform. Even if it is not a loss-leader for you, your margins on integration work are probably far lower than margins on your core systems.
Buy integration software and own the process: In this path, you buy integration software such as Dell Boomi and deploy it in each of your customers.
Benefits: You build custom integration for each of your customers so you can get it exactly right.
Drawbacks: Integration can still be time-consuming even with commercial integration software. Often the expertise required to use commercial integration software may be hard to hire and hard to keep as they may not fit in neatly with your development team structure. Furthermore, the pricing model for many integration software systems can be challenging to make work with your business. There may be a large one-off fee for the software plus an ongoing fee that does not reflect the value delivered over time. Additionally, your sales cycle may be lengthened by your client performing security reviews of the commercial integration solution in addition to your own solution.
We track most of the integration software companies using the PIRATE profile methodology. You can read about this by clicking this link.
Encourage your customers to develop their own integration capability: In this path, you build good APIs into your application and push the problem of integration onto your customers.
Benefits: Your customers can build integration deep into their systems which maximises the benefit they receive from your software. For example, take procure-to-pay SaaS software where the business value can extend deep into the finance and treasury teams. If your customer takes a wholistic view to integration they may achieve efficiencies that go well-beyond the traditional procure-to-pay business case.
Drawbacks: Your ability to sell your application relies on your prospect's perception of their ability to integrate with you. If the key decision-maker in your prospect does not have confidence that their IT department can integrate with you, they will not sign a contract.
But there's a way to get the benefits of all three paths with none of the drawbacks.
Managed Functions White-label / Co-label solution handles all of your customer's integration requirements whilst creating native cloud infrastructure that can be deployed to our cloud, your cloud or your customer's cloud. You can read more about how Managed Functions works at this link.
Our integration specialists can even participate in your sales calls to provide your customers with confidence that integration is a low-risk part of the project which speeds up your ability to close deals.
Let's look at a typical sales cycle for a B2B SaaS software company using our white-label or co-labelled service:
Step 1: You validate a prospect
Step 2: You set up an integration call with your prospect, your sales/pre-sales team and our integration specialist. In the call, our specialist uses your brand or is co-branded with you. We lead the call and, during the call, prepare an integration diagram.
Step 3: We meet with your team to identify the optimal integration approach. This is usually a two-phase approach where, in phase 1, we integrate at the minimal level for you to deliver your solution. In phase 2, we integrate more fully with your customer and fully automate any manual steps remaining in the process. Phase 2 is optional for your customer.
Step 4: Your customer chooses whether to stop at the phase 1 integration or do both phases of the integration. If they elect to go with both phases of the integration it is because they see additional value and are willing to pay additional fees.
Step 5: Our white-labelled / co-branded integration team builds the integration, deploys it to your customer's preferred cloud provider and then manages the integration.
The advantage of this approach is two-fold:
In the first phase of integration, your customer is on-boarded and starts using your SaaS service as quickly as possible, and
the second phase of integration can be priced differently from the first to reflect the additional value delivered to your client.
Using the Managed Functions white-label / co-branding approach, you can solve your integration problem and see the following benefits:
Getting started is easy. Contact us and we'll walk you through the white-label / co-branding approach. We can shortly have you up and running with a full integration service that delivers the optimal value to you and your clients.