Defining a Marketing Strategy for a Software Company
The client was a leading software company incorporated in Gujarat and employing around 15 people. It had developed a web transact suite (WTS) including an application server, an integrated web server and a transaction server. Priced competitively, the WTS functionality compared well with offerings of other well-known products like Apache, WebLogic, Tuxedo etc. Further, the client intended to offer the product to application service providers (ASP), internet service providers (ISP) and independent software vendors (ISV) who serve a middle market clientele that is extremely cost conscious and cannot afford the cost of a full-fledged implementation of well-known branded products like Oracle, IBM or Microsoft.
Thus, the top management prepared a rough cut plan including financials for promoting the WTS. However, it requested UC to validate the assumptions underlying the business plan, to define a strategic roadmap and also to value the WTS.
To develop the marketing strategy for the client, UC adopted the following approach:
- Understood the business plan prepared by the client with its underlying assumptions
- Defined the seven key strategic questions that required to be answered as part of the engagement
- Analysed the following parameters -
1) The software product segments and key trends with a key focus on packaged products, e-commerce products and middleware
2) Competitive offerings from Microsoft, IBM, Oracle etc vis-à-vis WTS
3) Impact of the open source movement on the WTS
4) Customer profiles and their IT spends especially on web suites
5) Appropriateness of various types of distribution channels based on the complexity of the product being sold
6) Evaluated countries’ attractiveness for the WTS
7) Key success factors
- Recommended the following initiations -
1) The WTS should target small and medium enterprises (SMEs) in India and other countries where English is predominant as a language
2) The WTS should be priced under USD 600S
3) Value added resellers (VAR) and systems integrators should be used as the distribution channel, given the complexity of the product
4) WTS be positioned as a high value for money product rather than as a technologically superior one
- Valued the WTS using similar transactions, discounted cash flows and replacement methods.
The client received a detailed strategic plan and an assessment of the value of its WTS.