For GoodData, SaaS Changes The Channel Model Too

Last time I mentioned GoodData, it was in passing, as I discussed YouCalc and other SaaS BI players. In the ensuing year, many other toes have been dipped into the water. I sat down with GoodData CEO and founder Roman Stanek and Marketing VP Sam Boonin this week to catch up on how it’s all going, and from where they sit, the news seems to look pretty good. With 40 employees, 25 customers since last November, and a funding round from the likes of Marc Andreesen and Tim O’Reilly, GoodData seems to be off to a GoodStart. And now it has a new initiative: free analytics for other SaaS players to expand its presence.
The value proposition to users is familiar: on-demand, adaptable, self-service at low cost. You can be forgiven for thinking you’ve been here before. Vendors large and small are making such claims. And the usability, feature-function part is something you have to get hands-on to see for yourself – GoodData makes that easy, so you don’t need me to spend too much of your time on it here. Just follow the link in the first sentence, and play with it yourself – it’s a very simple UI, thoughtfully constructed.
GoodData’s innovation with its new announcement issues a challenging question to the market: can big, direct sales-oriented vendors really get there with their existing products just by “putting them in the cloud”? And more important, will their sales, support and maintenance model truly work for a multi-tenant, continuously updated, SaaS-oriented portfolio like the one you are likely to want to point the product at? The answer so far is “not very likely.” And the ranks of existing and emerging players alike seem to be struggling to find a way to fund and grow themselves in this environment.
GoodData has some intriguing ideas about new routes to market, and it’s acting on them with its new Powered by GoodData initiative, with GoodData for Zendesk as the first available offering. The first wave of adoption was driven by the GoodData for Salesforce product – focusing on one audience, a well-understood environment and design helped the company solve customer problems that were well worth the monthly cost it charges. You can see how it fits into the environment as another tab to pick in the figure (click to expand.)
But that wasn’t the only success – other prospects, like Gazelle (see and hear their story here) wanted access to more kinds of data, and the collaborative nature of the multi-tenant GoodData on Demand offering lets them build dashboards to be shared with partners or suppliers.
It became clear that customers were looking for a platform as a service (PaaS) offering: provision, model, load, operate, optimize. Instead of spending the bulk of their investment on plumbing, customers could get up and running fast, for a relatively small fee. The question is how to get this offering to them. It’s not a direct sales model – that would be much too expensive for GoodData itself. But in the new market, where what the users are running is not on-premise, rigidly constructed silos, a new approach is possible.

Zendesk shows the way

The opportunity becomes clear when you step back and realize that more and more application services are being delivered and consumed in the cloud. One such service is Zendesk, a customer service and support player that offers ticket management and a community-based model in the cloud. Zendesk needs analytics to make its customers even happier, and GoodData needs use cases that demonstrate the value of its offering. The partnership, in hindsight, is obvious, and marginal cost per customer for GoodData couldn’t be lower. It’s a synergistic play, and offers GoodData a chance to gain some more share fast, with obvious upsell possibilities. The value proposition: “with GoodData for Zendesk, we introduce a way for SaaS providers (and their customers) to succeed with analytics.” And it’s free: for SaaS providers, for the end customers; GoodData comes with the product. It neatly connects application users without IT involvement, and without the SaaS vendor spending months in negotiation and engineering to create a go-to-market offering. GoodData believes that when customers see their data, they will want to analyze more data from more sources. And here the upsell comes. Everybody wins. In his blog post, Boonin makes it very straightforward, appealing to the SaaS vendors this way:

“We want to meet your customers. Our value proposition to you is simple: let us delight your customers with meaningful and actionable dashboards, and give them the power to slice and dice the data how they want. We can take analytics off of your product roadmap, let you deliver in less than 60 days, without major engineering investment, and we can even show you a way to make money up-selling advanced analytics. All that we ask in return is the permission to market and sell to your customers.”

This is a new model of channel partnering. It appears very powerful. Its success will depend on the quality of GoodData’s offering, its ability to execute, the number of partners it can identify and the pace of movement to the cloud by companies that have not yet set their architectures in stone. Looks like a model for the future.
Disclosures: GoodData is not a client of IT Market Strategy

About Merv Adrian
Gartner Research VP, technology analyst and consultant, 30 years of industry experience, covering software mostly, hardware sometimes.

2 Responses to For GoodData, SaaS Changes The Channel Model Too

  1. Hi Merv, nice article and congratulations to Gooddata. As you mention in your opening sentence: “many other toes have been dipped into the water”. Indeed, while Gooddata has signed up 25 customers since November 2009 with 40 employees, my company Mirror42 signed up 650 customers for our SaaS Performance Management solutions since January 2010 with 12 employees. We also operate KPI Library, with over 205.000 members the largest community on the globe on Performance Management. If you want to learn more about what we are doing don’t hesitate to contact me.
    Regards,

  2. Merv Adrian says:

    One of the great things about having a blog people read is how one gets connections like this. I’d love to talk. I’ve been aware the KPI Library was out there and I’m interested in its role in creating a community approach.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: