Customers using Web 2.0 applications are driving expectations for SaaS ISVs

in 2008 your customers will more and more expect you to offer your business applications via SaaS—whether you are ready to or not.

A long time ago (or so it seems) a similar tale unfolded as customers forced ISVs to shift applications from character mode to GUIs.

The pressure for change did not come from the ISVs. I am sure you also had managers who thought GUIs were a backward step in productivity for business applications. Product managers often claimed “our users do not want a mouse.”

As customers became used to GUIs on their home PCs, they expected the business software they used in the office must also have a GUI—whether it really needs it or not.

The exact same process is being repeated today with the shift from installed software to SaaS.

The pressure mounts on the vertical business applications supplied by ISVs as customers become more used to web-based applications. This pressure will only increase as web-based applications are getting better every day.

2 Web-based applications to sample

Why not invest a few minutes to see for yourself how good some of today’s web-applications really are?

Here are 2 web-based applications I have used that I think are good examples of the state of the art:

• The Picnik online photo editor is a leader in the ever-increasing range of web-based photo-editing tools. Graphic tools such as Adobe’s Photoshop are the classic examples of installed applications. Picnik shows that graphic applications not longer need to be installable software.
• The Squarespace web publishing system is a web-based application for creating and publishing blogs and web sites. The layout and customizing options in Squarespace will give you a good idea of the rich user experience that your customers will be expecting from you from mostly text-based applications.

I think you will agree that these web-based applications are very nice and really rather impressive.

Are you keeping up with your customers?

Your customers are already using web-based applications such as Picnik and Squarespace in their “other life” outside of the office.

These are consumer applications so they are called Web 2.0 rather than SaaS. Even so, your customers are gaining a lot of experience with such web-based applications and this continually raises the bar on what is expected of you from your vertical business applications:

• Will your SaaS business application be as easy to use as Picnik or Squarespace?
• Will it be as much fun?
• If not, why not?

Make the most of the new web-based applications and get to know what is already possible. Do not lag behind your customers on what is possible with today’s web-based applications. Your customers will be expecting at least the same from your SaaS business applications.

Let your competitors repeat their GUI mistake

Many of your competitors are repeating the mistake they made resisting the shift from character mode to GUIs. They are holding meetings right now at which they are trying to convince themselves “our customers do not need SaaS”, or “our customers want to have installable software.”

Leave them to make their mistake—while you double your efforts in 2008 to rebuild your ISV to survive and profit from the shift from installed software to SaaS.

Thank you for reading ISV Survival in 2007. I hope that you are having a good break over Christmas and the New Year.  See you in 2008…