Strategy Rule 5 – Differentiation – Make it Simple, Intuitive and Indisputable – The Best of Both Worlds
The enterprise software market for gorillas is becoming soup - MISO soup - Microsoft, IBM, SAP and Oracle.
Large enterprise software vendors have a lot going for them. They have a big base, a large sophisticated salesforce, and big budgets to create a lot of noise in the market. Microsoft has a low-cost global channel with partners in every locality to explain and deliver their products.
It’s simply not possible to “out-base”, “out-salesforce” or “out-noise” MISO or even the lesser enterprise gorillas.
The big advantage of the open source model is the community and the low cost global internet distribution model. For this to work effectively your differentiation must be simple, intuitive and indisputable. You can’t rely on a sales-person having a long conversation to argue your differentiation or a long evaluation to prove your differentiation. It is critical to attack “the weakness in their strength” - classic “Ries and Trout” marketing warfare (First published 20 years ago but still as valid today.
Their strength is the salesforce and big marketing budgets. If you can get you message across simply without the need for a large expensive salesforce and large marketing budget then this becomes their weakness. The channel becomes too expensive to deliver the product. What you have is a classic open source best-of-both world’s strategy.
The best market for this is an already educated market that has been using the technology for a number of years.. The market doesn’t need to be taught what the problem and pain chain is. They know it. What they want is simple competitive based, differentiation based messaging.
The customer knows:
- The High-End systems are too expensive and complex
- The Low-End systems are low priced but don’t meet requirements
- But why should I choose you?
The customer has to come to the conclusion the best solution is in the middle - The Best of Both Worlds. (This is best described by John Zagula and Richard Tong in the Marketing Playbook. I’ll talk more about this in later blogs)
An example is the following Differentiation/Comparison of Alfresco, SharePoint and ECM Stack:
- ECM may be Scalable and Robust but it is too Expensive and Proprietary
- SharePoint may be Lower Cost but it is Proprietary and not Scalable
- The world needs an open source alternative to legacy ECM
- The world needs and open source alternative to SharePoint
Open Source, Scalable and 1/10th of the cost - The Best of Both Worlds