2 Things That Business Softwares Do — Which One Should You Build?

Update: Someone pointed out Maslow for B2B from Prasanna. Do read that for better articulation driving the same point.

There are 3 kinds of business softwares, that do 2 things viz., save you money (bottom line), or bring you more money (top line).

  1. Software that saves you money — Software that saves you money directly tend to optimize your procurement viz. server costs, power costs etc. These are generally an upgraded technology or a smart resource monitoring system.
  • Value proposition is very clear. Customer invests X amount in the software and any directly measurable saving above X is a win.
  • There shouldn’t be human on the client side to manage the new system. Installation etc. must be handled by seller else selling becomes tougher.
  • Easy to sell in any region but generally has to be bundled with or piggy back on a bigger system. Like a resource monitoring system on top a server system.

2. Software that saves you money through saving human time. These softwares bring money saving at second degree. They decrease manpower requirement which ultimately results in money saving. Most business softwares fall in this category as they bring some form of workflow automation.

  • Being able to show the value proposition is tougher as it is difficult for a lot of businesses to fire manpower. In businesses where only one person’s time is saved because of your software, it’s of little use as they cannot fire half of that resource.
  • Manpower training is required. Must be done by the seller. Generally the decision maker isn’t using the software but his sub-ordinates are. There is a shyness to adopt new system hence they complain. New systems also results in fall in productivity temporarily due to steep learning curve and some the software is never adopted. When done right, this also creates a lock in.
  • Easier to sell in regions where avg. wages are high. India is tough country for such software.

3. Software that brings you more money — These are generally “intelligent” softwares. A/B test, targeting etc.

  • The management and employees’ tendency to adapt such a software is always higher as the affected metrics is also a key metrics for any business.
  • A lot of work flow softwares also fall in this category, like a notification tool that reaches out to your customers for upsell. The incremental revenue in such a case is only the difference between doing no marketing vs. doing some marketing. A good software in such a case should add intelligence by telling you what is the right time to send notifications to each customer, else the software would soon be a commodity. A tool that brings the benefit of network survives this game better.
  • Sell it to sales/marketing team. Keep it as independent as possible so that other departments do not interfere during adoption.

Webengage, the marketing automation software, started as Webklipper, an annotation tool that would save time in design feedback. It later converted to a feedback capturing app. A feedback capturing app is only useful until you have team/resources to act on the feedback. For the last few years, Webengage is a marketing automation tool that pitches higher conversion rate as its USP. This value proposition appeals to a wider audience.


Originally published at Naman Sarawagi.