Most Content Management Systems (CMS) today resemble white elephants. Terribly expensive to maintain, these applications (like their animal cousins) consume a lot of time, energy and resources to just keep them alive and functional. Over time, and over multiple forced upgrades, these applications turn out to be far more expensive to maintain than they are worth. As a result, many organizations have never been able to justify the high cost and long implementation time required to install a content management system. Moreover, as content management systems typically involve a range of tasks involving usability, information architecture and interface design customer’s face a Herculean task in ensuring that content is easily accessed, created, updated, published and retired.
In many instances, customers have also found to their dismay that even if they are not happy with a particular content management system, they are forced to use it as they have already invested substantially in purchasing, integrating, adopting and maintaining the application.
Putting an end to nasty surprises
What is the solution then? The answer could lie in a relatively new way of consuming software, called ‘Software as a Service’ or SaaS. Unlike traditional software, where consumers pay a huge amount of money to buy a software product, and then spend additional amounts to make sure that the software justifies its ROI — a vendor delivering a product through SaaS gives no such nasty surprises. As the software is hosted, there is no hardware to buy and no software to install and no infrastructure to manage. As a customer, you just pay on a fixed monthly or quarterly basis and leave the task of managing, maintaining and upgrading the software to the vendor.
SaaS vendors have filled a much needed void prompting independent analysts to predict a period of high growth for specialist vendors. Research firm Gartner expects the SaaS market for Enterprise Content Management services to grow by 30% annually. While the base is small, the potential is huge. Currently, Gartner estimates that only 2 percent of the money spent in the ECM market which translates to $25 million of a $1.2 billion market is spent on hosted solutions. As the popularity of SaaS vendors increase, one can expect SaaS to command a much larger share of the ECM market. For the record, Gartner estimates the global SaaS market to grow to $19.3 billion by 2011, tripling in size from the $6.3 billion it was in 2006. Similarly, research firm IDC predicts that SaaS will be worth $10.7 billion by 2009.
Why CMS delivered using a SaaS model leads to more value?
To understand why SaaS solutions from specialist players such as CrownPeak are increasingly been preferred by customers, consider the following facts. In a conventional CMS system, success of the implementation is not guaranteed. You pay for the system, and then pay more to justify what you have already paid. The real work in a CMS implementation begins after the site goes live which is when most vendors leave you the keys to the CMS and say good luck. Template tweaks, workflow changes, site redesigns, architecture updates, creating new landing pages and micro sites, and publishing take a lot of time, and are messy if they involve integration with multiple systems such as your campaign management system or your CRM application. This means that the customer is responsible for systems deployment which is mostly done through a third party vendor. In addition, the customer even has to cough up a significant percentage of money for annual software support.
Most enterprise application users would be surprised to know that SaaS vendors actually guarantee you a running application fully configured to the environment of the organization. Accountability is the strongest point of a SaaS vendor, as there are financial penalties for failure to meet the defined metrics in the Service Level Agreement.
Lower Costs, Improved Scalability and Greater Flexibility
Similar to an outsourcing agreement, where the cost of support, licenses, and manpower is spread across multiple clients, a SaaS vendor can keep costs low, although continuing to deliver high value added services. It is estimated that more than 60 percent of the total cost of owning an application is due to costs due to upgrades, support, security management and trouble shooting. In a SaaS model, the costs are lower as the vendor takes care of every aspect of implementing, managing and upgrading the application. You also save costs as you do not have to budget for a developer who tweaks the HTML code, or a webmaster who actually takes care of hosting. Players such as CrownPeak provide a dedicated account manager for the lifetime of the service, who is the same person who actually implements the CMS for your site, as part of your monthly cost an option that can be used extensively by small and medium organizations for bringing them on an even keel as their large counterparts.
By using a SaaS model, customers can cut down on their risk, and choose different functionalities as they grow. For instance, if they find that a solution no longer meets their changing needs, they can simply shift to another vendor. As most SaaS vendors bill on a monthly or quarterly basis, costs are spread across the lifetime of a product’s usage. This is an extremely attractive value proposition when compared to the traditional software model, where costs are paid upfront, maintenance and site changes are still charged after launch, and the risk of product implementation and adoption rests almost totally on the customer.
Using SaaS to succeed in a converged world
In a digital world where your content can be creatively used in a variety of forms, effectively managing and using this digital reservoir of content is critical for competitive advantage. So you may have a Web analytics software that gives you the details about the most popular sections in your site, an installed CRM application that gives a complete picture about your customer, and e-mail campaign management software that blasts out customized mails to selected list of people who have visited or downloaded content from your site.
The key here is content, as content alone will drive people to your site, and will compel your customers or prospects to have a valuable opinion about your company. But unless these different pieces of the content information landscape don’t connect and talk to each other, the ROI on such initiatives will remain unclear. One can compare this scenario to banks, which have multiple delivery channels of delivering a service to a customer, such as the telephone, Web or the ATM. Unless the bank has a single view of a customer, it simply cannot deliver a satisfying service to the customer. As a vendor using a SaaS model takes end-to-end responsibility of streamlining the process of managing and publishing digital content, an organization can effectively measure the success of their online marketing initiatives.
For a world used to the tyrannies imposed by traditional content management application vendors, arrival of SaaS as a service delivery method with clear proven benefits is liberating. From dynamic website updates to managing digital assets, CMS’s from SaaS vendors offer one of the best opportunities for organizations to free themselves from the necessities of sustaining and maintaining a white elephant.