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Microsoft Just (finally) Acknowledged The Cloud Providers' Achilles Heel

Posted by Todd Hussey

Jul 10, 2017 12:34:30 PM

It's happening........what's happening????????

Have you ever seen the movie "The Big Short"? True story about an investment banker that bet $1B on the housing collapse of 2008 - he shorted the housing market. Everyone thought he was insane telling him "You are shorting the housing market? No one doesn't pay their mortgage" and his investors (the owners of the $1B) were flipping out! But he was convinced he was right and everyone else was wrong (including Alan Greenspan). He was patient, and went through hell for 5 years until "it happened" - the housing market collapsed - we know the rest of the story - he and his investors made a freakin' fortune.
Same thing here, I've been saying for years, and have been trying to make a business, on the premise that "cloud and the buyers journey" will dramatically disrupt the entire tech industry like we've never seen before - and vendors and channel partners have no choice but to fully embrace cloud and a digital marketing model or face sure (yes 100% certainty) extinction eventually.  
 

Well, just lst week Microsoft just accepted that fact. We all know that they're betting the farm on cloud. Next step for them (that I've been waiting for......) is all hand's on deck to lower Cost of Sales (COS) in the recurring revenue cloud world. The world of the generalist Field AE and CAM is evaporating, it's now vertical specialized Inside reps and massive digital marketing efforts where digital marketing is owning a large % of the sales process, and an Inside Rep, a body on the phone, is supporting the sale and/or channel partner as required. Yes, it's actually that simple and it's what 100% of all cloud/SaaS start-ups do.
 
Yes, we have seen all the big legacy vendors shred people 1,000's of great people to "fund their way" to a cloud business, but I have yet see any vendor say what I'm hearing Microsoft say "Cost of Sales is the Achilles heel of a recurring revenue cloud business and we're addressing that head on" - again my words.  
 
And we ain't seen anything yet...........
 
Moral to the story,
 
Dear Mr./Mrs./Ms cloud business owner wanna-be,
 
Cost of Sales aka Cost of Customer Acquisition is your Achilles heel. Avoid it and you'll tear both your Achilles heels - and that hurts!!!!!!!!

 

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Topics: digital marketing as a service, cloud business

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