Technology Companies' Challenges

Part
01
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Part
01

Technology Companies' Challenges

Although technology and SaaS companies represent a rapidly growing marketplace, they face many challenges when attempting to acquire new customers, including hyperspecialization, lack of SaaS-specific business solutions, quickly shifting public attention, and failure to invest in brand strategy early on.

Challenge 1: Hyperspecialization

  • In addition to market saturation, SaaS companies are struggling with hyperspecialization, a situation that occurs when each individual business function may require multiple products—which are often provided by different vendors. Technology companies that want to address a number of different business processes will likely need a separate product for each, which can be a costly endeavor.
  • This problem is further exacerbated by saturation—the vast array of solutions/apps available for any given business function—and is only expected to increase as the market continues to be flooded with new SaaS apps.
  • SaaS Mag offers several solutions for acquiring new customers in the face of hyperspecialization, including utilizing public Application Programming Interfaces (APIs). APIs promote value among potential customers by ensuring that SaaS apps are easily integrated with other market solutions.
  • Another potential solution is publishing a "Zap"—an automated workflow that facilitates seamless app integration—and submitting it for hosting on the Zapier's Integrations page.
  • SaaS Mag further recommends considering which tools customers are likely to use along with a given SaaS app and focusing on ease-of-integration in both the design process and product marketing plan.

Challenge 2: Lack of SaaS-Specific Business Solutions

  • Until recently, most up-and-coming SaaS firms have been forced to rely on traditional financial operations, disconnected systems and manual processes (i.e. spreadsheets) in order to manage a subscription model.
  • Outdated business operations lead to errors and hinder a company's ability to scale effectively and take on/manage new customers with ease.
  • Fortunately, due to the rise of SaaS companies (as of April 2019, roughly 50 top SaaS companies are publicly traded), more modern (and increasingly affordable) solutions are now available that were created specifically to support small and scaling SaaS firms.
  • Subscription management software allows SaaS companies to move from time-consuming manual processes to automated systems and improve in a number of areas, including subscription billing and collections, order management, revenue reporting, analytics and metrics.

Challenge 3: Quickly Shifting Public Attention Span

  • While there are pitfalls to attempting to scale your SaaS company too quickly, the short attention span of the American public poses an additional problem if firms fail to grow rapidly enough.
  • The initial free publicity that many new SaaS apps enjoy can fade rapidly, and if SaaS companies don't have strategies already in place to capitalize on that initial excitement, retain public attention and grow explosively from the onset, continuing to attract the attention of new customers can be difficult as the public moves on to "the next big thing."
  • Using ingenuity to continually invest in new and creative means of promotion can help SaaS companies continue to attract new customers even after the initial limelight has faded. For example, in its first two years Dropbox managed to grow by 3900 percent using a simple referral program.

Challenge 4: Failure to Invest in Brand Strategy

  • Many SaaS companies, particularly new startups, understandably focus heavily on product development and distribution. However, many fail to properly determine their target market and develop a powerful brand/marketing strategy to reach that market and continually and cost-effectively acquire new customers.
  • Particularly over the long term—when competitors may be copying your product—brand strategy and customer experience often become paramount to prospecting and sales tactics. The right branding also helps keep current customers engaged, which not only helps with customer retention but also makes them more likely to refer new users or pay increased prices down the line.
  • Ideally, brands should make promises to customers that trigger an emotional connection. Consistently applying this promise through continued brand marketing builds brand equality and improves customer experience.
  • These satisfied users can then be incentivized to help acquire new customers through word-of-mouth at a low cost. For example, Yelp recruited its most charismatic users to create a group of community managers known as the Yelp Elite.
Part
02
of three
Part
02

Technology Companies' Roadblocks

Some additional roadblocks that technological firms are facing when striving to reach their target goals include interoperability issues, cloud plan issues, unstructured data, keeping up with rapidly shifting new technology, adapting to viable social networks.

Interoperability Issues

  • One of the roadblocks that technological firms are facing when striving to reach their target goals is compatibility with other operating systems.
  • There is an increasing demand from users and customers of technological firms for the items on both their mobile devices and their desktops. Therefore, it is necessary that effective communication of systems with one another be established, whereby data can be sent and received with compatibility on user platforms of all types.
  • The progress of companies becomes hindered when some developers do not utilize open architecture and frameworks capable of seamlessly communicating with other systems.
  • The future then involves the use of open applications as well as systems created through open standards, where development efforts are centered on either the application or system, along with the ways in which the system/application cooperates with others.

Cloud Plan Issues

  • Another roadblock that technology firms are facing when striving to reach their target goals is that many of them have not made cloud plans. These firms decide to store their applications and data in-house, while handling everything without outside assistance.
  • This action hinders the companies' progress as most applications are usually hosted in the cloud away from the application's users, and therefore, a lack of portable applications becomes a disadvantage to the company in terms of how it stores data.
  • Due to the innovations in cloud computing technologies and in order "to future-proof networks," making preparations at a firm for a possible cloud move becomes a crucial necessity.
  • A barrier related to the cloud that firms and organizations frequently encounter is the absence of resources and experience. Many firms are putting their workloads within the cloud and cloud technologies continue to innovate.
  • Hence, firms are struggling to keep pace with cloud tools, as the demand for expertise expands rapidly.

Unstructured Data

  • Within the next five years, data is expected to expand by about 800%. However, over 80% of it remains unstructured.
  • This development impacts the progress of the companies because unstructured data requires collection from brand-new sources, especially when traditional data management processes are unable to cooperate "with the variable nature of big data."
  • Unstructured data also serves as a new and unused source of organizational insight, with its analytics possibly being capable of unearthing more crucial data concerning interrelationships that were once challenging to determine.
  • To provide the best returns to an organization, big data analytics demands brand-new tactics to acquiring data, as well as storing and evaluating it. Unstructured data's considerable growth and volume greatly eclipses traditional solutions and exposes the need for up-to-date volume managing.

The Struggle to Keep Up with Rapidly Changing New Technology

The Struggle to Adapt to Viable Social Networks

  • Every successful firm is discussed on social media platforms such as YouTube, Facebook, Twitter, and LinkedIn.
  • The difficulty with shifting from supplying a platform that markets services and products into one that provides solid client solutions becomes a roadblock.
  • It can hinder the progress of a technological company as the social dialog that was supposed to be mined to assist marketing and sales initiatives, shape upgrades and new products, and enhance customer service is being neglected.

Part
03
of three
Part
03

Technology trends

Growth of marketing automation and the leveraging of artificial intelligence (AI) in CRM are two trends in the technology industry that relate to the use of marketing automation and CRM platforms. The details are outlined below.

Growth of Marketing Automation


Black and Decker Uses Marketing Automation
  • Black and Decker uses marketing automation to track each visitor and customer to its website.
  • It then uses personal data to create the prospect or customer's next experience on the site. This could be done through an email, a call, call to action, or a content offer.
  • As a result, Black & Decker says a reduction in the length of its sales cycle by approximately 30% in the industrial storage arm of its operations. It then increased by an additional 25% by year two.

Leveraging AI in CRM

  • CRM platforms are now being made to include AI in multiple ways. CRM software is now built to integrate AI which is used to improve customer experience.
  • It is estimated that by 2021, the adoption of AI in CRM software will generate an additional $394 billion in revenue. Another report projects that by 2020, the incorporation of AI in CRM would be worth $73 billion.
  • The 2019 State of Marketing report reveals that over the next two years, AI use cases would increase by up to 257%. The various uses and their respective increases are in the areas of personalization of channel experience (266%), programmatic advertising (269%), and customer segmentation (277%).
  • New functionalities are expected to be incorporated such as account scoring. AI is also being used to replicate past successes. Some apps have already been using the technology to track marketing materials all the way to closed sales.
  • Artificial intelligence is also being used in customer service as chatbots. This allows for the provision of self-service, the collection of information on each case, and several other tasks that are usually performed by agents.

Zoho Uses AI in CRM
  • Zoho's Zia uses AI-driven sales assistants that use CRM data to provide suggestions, alerts, and sales predictions.
  • Some of its functionalities include Zia Voice, conversion prediction, trend analysis, workflow anomalies and suggestions, and data enrichment among others.
  • According to Zoho's chief evangelist Raju Vegesna, Zia has significantly advanced since its initial launch in 2017. Zia, with the combined power of Zoho Analytics, has brought the company a "seamless and contextual flow of information across channels and departments". Zia made it simple for Zoho's different teams to collaborate as one in terms of providing better customer relationships.

Research Strategy

The research team was able to identify trends in the technology industry that relate to the use of marketing automation and CRM platforms in the United States. For each trend, we ensured that no less than three experts or market leaders were referenced, thus confirming each trend. Therefore, our sources include Smart Insights, Web Engage, AMA, Forbes, Email Monday, Salesforce and a few others.

Sources
Sources