Is B2B lagging behind B2C concerning the Warshaw era?
See previous post concerning the Warshaw curve and era.
Or read the original writing of Douglas Warshaw about On-Demand content consumption and Flipping the Bell curve on applying the Warshaw curve to B2C by Lovely Auer (also known as Adam Park).
Three different market segments are defined:
- The Land of Free
- The Highland of Premium
- The Valley of the Mediocre in between.
In most trends B2B is lagging behind on B2C, thus probably also for the Warshaw era.
Mobile providers: Land of Free
Just like in B2C, the mobile providers are showing the way in B2B too:
A free Asus EEE portable computer + free mobile phone when subscribing for a mobile phone subscription (in the UK and The Netherlands)
Of course this proposal addresses both consumers and business people; still the offering seems mainly to be geared at businesses.
B2B software
The Land of Free
These are the Low-End web service solutions appealing to a large market.
- The Free or Freemium model that is limited in use or capacity and for a limited number of users.
- Small monthly fee solutions for “generic” or universal solutions: CRM, Invoicing, Administration, Web analytics, Content Management System, Office applications, Contact Management, Collaboration solutions, …
These solutions can in most cases be defined by “Less is More” bringing the advantage of not only low running costs but also low implementation costs.
The Highland of Premium
Software used to be solely in the Highland of Premium.
Microsoft and their early competitors changed this in a first phase.
These are the “old” high-end software solutions for large or multinational corporations.
- ERP solutions: SAP, Oracle Financials
- CRM/Call center: Siebel
- Computer Systems Management: IBM Tivoli series, HP OpenView, CA Unicenter, BMC Patrol Consultant
These solutions can in most cases be defined by ‘Too complex to implement” by having high implementation costs and high running costs and can take forever to implement.
The Valley of Mediocre: occupied by Open Source?
Could Open Source solutions be in the Valley of the Mediocre?
They are Free: there is not an upfront payment or investment involved with Open Source. Thus the first impression is ‘The Land of Free’.
However implementing Open Source, a company needs to:
- Invest in a server
- Hire an experienced engineer or system integrator to install, integrate and run the software
- In certain cases: pay yearly for support and maintenance of the software.
- Know about the licensing: GNU GPL, GNU LGPL, GNU FDL, …, CopyLeft.
As the software has been created and crafted by a large number of contributors (individuals), it is likely to be complex, thus one or more specialists with experience in the matter (software, business and business process) are needed.
Moreover Open Source comes in many releases which are defined as stable or not stable.
Only someone with experience in Open Source software can pick out those releases needed to keep pace with the new versions and not to get stuck in an older no longer supported version.
Complexity of licenses:
GNU GPL, GNU LGPL, GNU FDL, …
- How free is the Open Source?
- What about the additional development changes: do they need to be placed in Open source too?
An experienced lawyer is required.
These additional hidden costs probably place the Open Source software solutions in the Valley of the Mediocre.
Example: VOIP
In the Land of Free:
- Skype, Windows Life Messenger, Yahoo! Voice and several others are available.
- VOIP Call centre: additional solutions have been added to Skype by third parties: like the call centre solution SKY-click (free)
In the Highland of Premium:
Any VOIP solution from the big brands like CISCO, Siemens, Ericsson, Nortel, Avaya, Lucent, …
The Valley of the Mediocre:
Again in the middle there is the Open Source provided by Asterisk.
A company has two alternatives:
- Hire a specialist to install and run the software
- Buy a pre-installed version on an appliance.
Again the Open Source VOIP can be placed in Valley of the Mediocre as the hidden costs don’t make it really free or low cost.
Warshaw for more traditional products
There are probably more examples besides the software industry.
Any design engineer can choose the quality required for his products depending on the product and market specifications.
- Low pricing, low quality: screws and fasteners having a low DIN Norm(alization)
- High pricing high quality: screws and fasteners having a high DIN Norm(alization)
Warshaw exists in B2B
Apparently the Warshaw era exists in B2B too.
And Warshaw is likely to stay.
The most obvious Warshaw examples are in software, SaaS or Enterprise 2.0 businesses as:
- They are in constant evolution to keep pace with new market trends and the fast changes.
- Their products and solutions can be deployed over the Internet as a service not requiring any physical delivery, thus freeing them up from any logistic costs involved.
More from LEADS Explorer
- What is the most important in the B2B buying process ?
- The 14 key differentiators between B2B and B2C
- The social media disruption for B2B marketing
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Thanks for good information sharing…..