After reading your post I personally feel like this is a necessary risk, and it will allow customers to have a simpler means of using shipping. By turning the postage into credit, big businesses with prepaid packages, such as Verizon Wireless, will be able to more easily organize packages and postage.
Also, this is a good example of how a marketing department sees a way to specialize their product, to be more effective than competitors. In order to achieve long-term success companies need to be able to continually adapt to changing market structures. With the world becoming reliant on the internet, having a credit-based mailing service enables USPS to offer an attractive alternative compared to their peers.
Saturday, January 28, 2012
Wednesday, January 25, 2012
Salesforce.com's Pricing Incentives to Boost Quarterly Profits
Through my Internship with TBRi, a research analytic company based in Hampton, NH, I recently wrote a scenario topic on Salesforce.com's announcement of a pricing incentive on their Customer Relationship Management (CRM) Software-as-a-Service (SaaS) portfolio. In this blog entry, I will give an overview of the CRM marketplace, so that my readers can understand the marketing strategy behind the announced pricing incentive.
Over the past year or so, as the topic of cloud computing began to create excitement within the software industry, Salesforce.com reconstructed the ways in which customers can utilize solutions to promote business productivity. With the release of the first SaaS solution, Salesforce.com brought enterprise class solutions to Small businesses and Mid-market customers, in an inexpensive format. To understand the effectiveness of SaaS solutions, I will offer a brief summary.
Traditionally, software would be loaded onto corporate PC's by selling the solutions bundled with hardware. For instance, Microsoft Office, a renown portfolio throughout the corporate world, would need to be loaded to customer infrastructure through a CD or some sort of hardware based product. With the release of Office365, Microsoft's SaaS Office solution, customers can now download the solutions they have been using for a number of years, straight to their network.
As vendors began to see the effectiveness of SaaS solutions, they too began to transition their portfolios to be software based, rather than hardware based. A prime example of this would be Hewlett Packard, announcing in their 3Q11 earnings call that they would be focusing on becoming a software-centric company.
With more vendors beginning to release cloud-based CRM solutions, Salesforce.com began to see demand for its portfolio fall, since the market was now becoming saturated with competitor solutions.
Salesforce.com made bold projections for its 4Q11 financials, and with market share slowly going to competitors, they needed to revamp their pricing model. And so, they cut the prices by 40% for the CRM portfolio, telling customers that the new pricing model would last into the following year as well.
By undercutting competitors pricing schemes, Salesforce.com will attract additional customers to sign, they hope, multi-year deals in order to meet their projected figures for the quarter.
This is a prime example of a marketing department analyzing a given market, and modeling their solution in new ways in order to maintain a strong share of the market. Furthermore, Salesforce.com is making numerous acquisitions, such as of cloud based vendor Rypple, to build out their portfolio into new lines of business. If Salesforce.com failed to adapt to the changing market, their CRM portfolio would not allow them to maintain competitiveness within the Software Market. By building into new lines of business, Salesforce.com will drive additional revenue and ensure long-term success.
This is just one real-life example of a marketing department revamping an aspect of a solution in order to maintain competitiveness in an ever-changing corporate world.
Over the past year or so, as the topic of cloud computing began to create excitement within the software industry, Salesforce.com reconstructed the ways in which customers can utilize solutions to promote business productivity. With the release of the first SaaS solution, Salesforce.com brought enterprise class solutions to Small businesses and Mid-market customers, in an inexpensive format. To understand the effectiveness of SaaS solutions, I will offer a brief summary.
Traditionally, software would be loaded onto corporate PC's by selling the solutions bundled with hardware. For instance, Microsoft Office, a renown portfolio throughout the corporate world, would need to be loaded to customer infrastructure through a CD or some sort of hardware based product. With the release of Office365, Microsoft's SaaS Office solution, customers can now download the solutions they have been using for a number of years, straight to their network.
As vendors began to see the effectiveness of SaaS solutions, they too began to transition their portfolios to be software based, rather than hardware based. A prime example of this would be Hewlett Packard, announcing in their 3Q11 earnings call that they would be focusing on becoming a software-centric company.
With more vendors beginning to release cloud-based CRM solutions, Salesforce.com began to see demand for its portfolio fall, since the market was now becoming saturated with competitor solutions.
Salesforce.com made bold projections for its 4Q11 financials, and with market share slowly going to competitors, they needed to revamp their pricing model. And so, they cut the prices by 40% for the CRM portfolio, telling customers that the new pricing model would last into the following year as well.
By undercutting competitors pricing schemes, Salesforce.com will attract additional customers to sign, they hope, multi-year deals in order to meet their projected figures for the quarter.
This is a prime example of a marketing department analyzing a given market, and modeling their solution in new ways in order to maintain a strong share of the market. Furthermore, Salesforce.com is making numerous acquisitions, such as of cloud based vendor Rypple, to build out their portfolio into new lines of business. If Salesforce.com failed to adapt to the changing market, their CRM portfolio would not allow them to maintain competitiveness within the Software Market. By building into new lines of business, Salesforce.com will drive additional revenue and ensure long-term success.
This is just one real-life example of a marketing department revamping an aspect of a solution in order to maintain competitiveness in an ever-changing corporate world.
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