IBM’s SaaS vs. On-premise Software Sales

As the SaaS economy is exponentially growing, we see more and more software vendors taking their business to the cloud. Which in return pushes the partner channel to undertake serious strategic changes like business digitization and subscription sales. Traditionally, software resellers selling standard SKUs, make their revenue from the small margins on top of every on-premise perpetual license sale they transact. But now with introducing end-customers to the cloud and pay-as-you-go motion, resellers can generate sustainable recurring revenue month after month.

Even though the heavy old-school license agreement may seem profitable venture with up-front fees, they contribute less money to the reseller organization in the long run. They also require more one-to-one engagement as the account executive moves the deal through a longer sales cycle. The subscription’s monthly “bite-size” payments and zero long-term commitments grow reseller revenue steadily and predictably. This means SaaS sales are closed faster, customer lifetime value estimations become higher, and monthly resale commission continuously fuel the reseller’s operational expenses.

With customers becoming more independent and demanding, individual acquisition costs are growing fast. Fortunately, the new SaaS sales motion satisfies the escalating demand. Now, IBM is modernizing its reseller channel to answer the new cloud opportunities.

IBM SaaS applications

By embracing the future of digital buying and selling, IBM makes sure that its resellers will meet the modern demands of always-on industries in a low touch environment. IBM’s cloud portfolio hosts 150+ SaaS applications - essentially everything necessary to reinvent a reseller catalog with ready-to-deploy solutions and minimum impact on IT resources. All IBM XaaS offerings are API enabled to seamlessly work with any cloud infrastructure resellers are leveraging. They are also designed to fit existing SaaS catalogs while providing an additional value.

The new Cloud Marketplaces Reseller program is developed to eliminate the up-front investments resellers can have in transitioning from on-premise to cloud subscription sales. When partnering resellers with cloud aggregators (and with the CA’s cloud commerce platform), IBM makes taking the decision to transform business structures easier. And ultimately allow them to get onboard with the new customer’s requirements (simple, transparent and fast buying progress) while breaking up with one-sided partner like box-movers’ distributors with no GTM strategy to grow their resellers.

IBM SaaS Resellers’ Success Stories

To win in cloud-based subscription sales, you have to believe in your cloud vendors and its software capabilities.

Adding IBM SaaS offers to their portfolio, IBM Business Partners have experienced:

When cloud hit the market, the rules of the game changed overnight. Suddenly, offerings from big-name brands like IBM came within the reach of smaller and medium-sized organizations for the first time. This development presented a valuable opportunity for us to capture market share and grow sales...

We have moved our entire business to the cloud—we no longer have servers in-house; everything now runs on cloud-based applications...

The new approach helps us run a much more agile business, as we can spin up new systems and react to changing demands from both our clients and the business very quickly. It is also saving us a great deal of expense and effort, as we don’t have to worry about keeping software up-to-date or standing up and maintaining hardware.

— Tim Pinchin, Head of Marketing, T-Impact

IBM SaaS solutions available with the IBM Partner Marketplaces Program

See full portfolio here. 

IBM has paved the ground for its Business Partners to turn into successful cloud resellers. Are you ready to start the strategic planning on how to transition from on-premise to subscription sales with a cloud aggregator?

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