David Cummings on Startups

Every SaaS Company Should Have an App Store Strategy

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David Cummings

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Salesforce.com set the standard several years ago with the introduction of their AppExchange app store providing a central repository of third-party applications that work with their platform. Apple took the idea and made it mainstream for consumers with their App Store for iPhone and iPad programs. Now, every Software-as-a-Service (SaaS) company should have an app store strategy.

Here are a few items to keep in mind:

  • Curating the app store is critical; too many SaaS companies claim to have an app store only to have many apps that aren’t functional or are “pretend apps” that are really lead generation to sell custom consulting engagements
  • An app store should be implemented once the startup reaches scale (e.g. 500 – 1,000+ customers) so that there’s sufficient demand from users to warrant the building and maintaining of the store
  • Some vendors charge a tax (e.g. 15% of revenue from apps that connect to the platform), which should be avoided as it’s better to encourage as many integrated products as possible and not alienate potential partners

While not an app store directly, companies like Kevy will emerge as data synchronization app connectors for hundreds of cloud-based products. Regardless, every SaaS company should have an app store strategy.

What else? What are your thoughts on SaaS companies needing an app store strategy?

Comments

4 responses to “Every SaaS Company Should Have an App Store Strategy”

  1. Daryl Lu Avatar
    Daryl Lu

    When I first learned of the AppExchange on SalesForce, I thought it was a brilliant strategy. They establish themselves as an ecosystem where customers with roots already in the SalesForce platform grow those roots deeper and wider via these partner apps.

    For the app partners, this, too, is a great strategy as it enables more or less turnkey solutions for their business. All too often in the past, companies relied on their IT groups and other partner integrators to implement complicated modules. These app exchanges/ stores with these add-on modules allow for faster implementation cycles. This just enables a lower hurdle for sales and implementation — great, again, for the app partners, but also for customers.

    Especially when building complex B2B products, integration to these large systems like SalesForce enables potentially higher sales opportunities from a marketing perspective and an implementation perspective.

    I think this is what also is pushing a lot of app developers to start developing their own apps with APIs to enable more “modular” builds. Very interesting the future is shaping up…

    Reply
  2. Chase Pursley (@gcpursley) Avatar
    Chase Pursley (@gcpursley)

    Timely post. I was recently contacted by the largest software vendor in my industry to integrate my product via their their new app store API. It’s a well respected company and founder. Suppose I should start talking to them about the details after my paid beta is complete. This has the potential to reach a lot of customers. But I’m a bit worried a bit about becoming too dependent or them replicating my product and adding it to theirs.

    Reply
  3. Robert Mullins Avatar
    Robert Mullins

    AWS launched the AWS Marketplace in 2012. How does that compare to AppExchange. I’m a reporter working on a story on this subject. David, please write me at the email address I’ve provided. Thanks.

    Reply
  4. Brad Hodson Avatar
    Brad Hodson

    I’d add one more point to your list: if you’re going to have an app store strategy, part of that strategy needs to consider how the apps will integrate into the system and how much they might muddy up the interface.

    SaaS software has a hard enough time already keeping buttons in check and interfaces simple. By adding extensions, add-ons, and integrated apps you open the flood gates to ruining the usability of your software.

    It’s always important to keep things in check. This is why Apple’s App Store is tightly locked down and only allows certain functions of an app to move outside it’s sandbox.

    Reply

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