The Cloud Marketplace Shift

Salespeople, forget the buzz around PLG and AI. Right now, a seismic shift is happening under our very noses, and it's not hidden in PQL > SQL conundrums or ChatGPT Sales Scripts. It's in the Cloud Marketplaces – AWS, Microsoft, Google, to name just a few. Co-selling with these giants is not just an option; it's an essential strategy.

According to data from Forrester selling through marketplaces:

• Increases ASP by 80%
• Reduces time to close by 40%
• Increases Win Rate by 27%

It's unsurprising that Amazon leads this revolution. The potential gains for early adopters and risks for hesitators remind me of how Amazon disrupted retail giants 20 years ago. Cloud Marketplaces are to technology procurement what PayPal was to eBay in the 2000s.

In the last six months, I've worked closely with AWS, exploring the Marketplace. What we've found is not just a trend but the beginning of a new era. It's the biggest shift in customer engagement and buying since cloud and SaaS came into play. This shift is a win/win. It's as beneficial for us vendors as it is for our customers.

Here are my top 5 reasons why you need a marketplace strategy:

1. Co-Selling: This boosts sales by leveraging a cloud partner's existing customer base and insights. Joint sales efforts enhance your pitch, while partner involvement speeds up decision-making for faster sales cycles. The partnership also supports custom solutions and provides resources to improve your sales team's performance.
2. Committed Spend Utilization: This helps enterprises use their existing AWS budgets to buy your software, making it financially attractive for them. This is a strong selling point that can give you a competitive advantage by lowering the financial barriers for customer adoption.
3. Speed: Cloud Marketplaces speed up sales by streamlining procurement and simplifying product discovery. This helps customers make quick, informed decisions and allows vendors to close deals faster.
4. Win Rates: Selling on marketplaces increases win rates by fast-tracking sales, building credibility, attracting ready-to-buy customers, and leveraging co-selling for warm leads. It also helps customers make informed choices through reviews and comparisons.
5. Increase ASP: Marketplaces boost Average Selling Price by offering value-added bundles, attracting a premium audience, and simplifying purchases. Co-selling enhances product credibility, paving the way for value-based conversations that can increase revenue.

Sales velocity increases by 280% through marketplaces. While it doesn't mean $1 sold directly becomes $2.80 on the marketplace, overlooking the growth and the quicker time-to-close would be a mistake.

Two weeks ago, I heard a VP of sales at a $2BN ARR company say: "Last week, my team completed a $10m deal in 5 minutes.”