In my last blog, I teed up the concept that to stand out from the growing competition in the market, it is important to establish a strong differentiation strategy. In our research with IDC on the Modern Partner, we found that partners have four distinct ways to differentiate themselves including establishing a vertical or industry focus and building their own packaged intellectual property (IP). Businesses who do this effectively are more profitable and put themselves in a better positon to compete for and win new business. When partners hear this, they often, say, that’s great, but how can I get started?
Who better to answer this question than partners themselves? To this end, I recently had the opportunity to interview Andrew Brodie, CEO of SSB based in Denver, Colorado, who I believe has a strong differentiation strategy and is experiencing strong growth and profitability.
Key Learnings Around Leveraging IP
Andrew shared some great business insight with me and I think there are some key takeaways from his experience that partners can turn to when looking to have similar success. Those key learnings include:
- Maximize your success in a vertical or industry by partnering with key stakeholders or providers who are currently established in that industry.
- Proactively look for opportunities to build packaged IP.
- Partner with a customer to build your solution, while ensuring you are maintaining the rights to the IP.
Partner Spotlight on SSB
A common challenge as partners move to the cloud is building up recurring revenue streams and creating more predictability from a cash flow perspective. Can you tell us a little bit about how you are building up recurring revenue within your professional service business and the impact on your revenue?
At SSB we’ve always wanted to change the traditional consulting model. With our experience with big consulting companies we observed many projects that cost too much and that were also not sustainable for the client. Our approach was to build software and solutions to accelerate our customers’ business intelligence needs by reducing upfront costs, but also to host the solutions we built addressing the sustainability of the solution for the client while stabilizing our business with a recurring revenue model. With our approach both sides win, as our clients are typically operating much quicker than in the traditional consulting approach, and SSB is vested long term in ensuring the success of the project and client.
While every consulting engagement is unique, our model provides some unique benefits to our clients. Typically, during each engagement, our clients gain the expertise of what normally requires 3 to 4 people to cover database administration, business intelligence, report writing, and business analysis. From that expertise gained, two major outcomes arise. First, in almost every situation our clients benefit from reduced staffing requirements of at least one full-time employee (FTE). Second, clients now have more time to focus on their business goals, not administration, and they have more complete insight into their business.
“Within our own organization, this new consulting model and results driven approach, has allowed SSB to grow our customer base and overall revenue by 50-100% annually for the last three years.”
– Andrew Brodie, CEO of SSB
Building IP has been a clear component of your success and differentiation strategy. Can you provide insight into how you started down this path?
We founded SSB eight years ago as a professional services consulting organization but we always had a goal in mind of building intellectual property and establishing a recurring revenue stream with our customers. We would look out for opportunities within our customers to say, “that’s a repeatable process” and it wasn’t very long before we had our first customer, Denver Center for the Performing Arts, where we identified one of those opportunities. Their executives were struggling with getting access to disparate information across their ticketing, email, and marketing systems. We built a system that consumed all that information in a data warehouse and ultimately provided them with the sales and analytics that they needed.
What happened next was interesting. The ticketing provider, Comcast, took notice and brought us into an opportunity with their client, the Portland Trailblazers of the NBA. We flew up to meet with the Portland Trailblazers and we quickly repeated that process. Once we did that, we knew that we were onto something with this ticketing business and we then negotiated with Comcast to become their exclusive partner to do enterprise data and analytics, and our first recurring revenue stream was born.
You shared with me previously that in addition to the partnership with Comcast, you also formed a partnership with Ticketmaster. Can you delve into that a bit and provide some insight into what kinds of doors that has opened for your business?
The Portland Trailblazers were originally a Comcast customer who then moved to Ticketmaster for their ticketing services. When they did, they trusted us to do the same thing we did with the Comcast solution with Ticketmaster and provide the same service for all of their customers. Today we are proud to say that we represent over 40 professional sports and NCAA organizations.
Now that you have a strong foothold in the professional sports industry, are you looking to expand into other verticals?
Absolutely, we are already working on building our business in healthcare and higher education. One example of this is a constituent registry solution for higher education that we built with Arizona State University. The solution brings in their students, donors, fans, alumni, and anyone else from their philanthropic giving standpoint into a data warehouse where we cleanse the data and feed it into their downstream business processes, such as student recruitment or alumni donation through ticket sales.
What advice do you have for partners that are interested in starting to build packaged IP?
My best piece of advice is to find an early adopter who is willing to be a partner in building your intellectual property. In our case, Arizona State University has been a really strong partner. We built our alpha products with the idea that we will sell them to other people, but partnering with the Arizona State University allowed us to test the solution in the real world.
“If you have a client that is interested in coming along for the ride while you are building your product, there is likely a big market for the solution.”
– Andrew Brodie, CEO of SSB
Have you built your own packaged IP to help with recurring revenue? Tell us about your experience in the comments section below.