Hi Guru,
You always write such a long email but hit my hear with every sentence.
In china we have some same situation you said, plus no decision maker nor
end user can communicate in English easily, this make OPW hard to sell, on the
other hand, few chance to sell official SAAS, but I do found a china silver
partner we never heard of (no contribution or share) sell much enough to be
silver.
I do prefer OpenERP SA do more services to partners, training\ module
certificate\annual fee are all welcome, this is not only for good of win-win
business, but also good for better openerp product.
SAP involve improvement idea from his big consulting partners like AC and
IBM, cause ERP is a complex software and there is hard to involve "End User
contribute".
my 2 cents.
------------------
Jeff Wang | j...@osbzr.com | 18016291663 |02158980787
@OpenERP_Jeff "As simple as possible, As complex asneeded"
Maintainer of Open ERP china community
http://www.openerp-china.org
------------------ Original ------------------
From: "Raphael Valyi";<rva...@gmail.com>;
Date: Fri, Feb 28, 2014 02:33 PM
To: "Fabien Pinckaers"<f...@openerp.com>;
Cc: "openerp-community"<openerp-community@lists.launchpad.net>;
Subject: Re: [Openerp-community] OpenERP Marketing
Hello Fabien and others,
much has been said by other experienced partners/communitymembers and I mostly
agree with what they said.
So I'll give my main points to be constructive:
I also think OpenERP image could be better. And I think 3things are dragging
you backward:
lack of marketing consistency in the time
frustrations
prostituted ecosystem
Let's dig further into each point and see what I mean andwhat can be done. I
know that in some area you are alreadyimproving, but give my analysis anyhow:
1. lack of marketing consistency in the time
It takes a lot of time to build the image of a software and acompany you can
trust worldwide to run your critical mission ERP. Asoftware that will do at
least some part of your accounting, thatwill hold all your critical company
data, that will cost you somuch...
But too often OpenERP was changing its message in inconsistentways gain the
durable mindshare you would find in Linux, orPostgreSQL for instance:
A few example:
branding: you were once TinyERP, then OpenERP. You now tell usthat you will
eventually change the brand name again (hey wedidn't had our sorrySAP yet this
year :-p )
business model: you were an integrator, then an editor, nowagain eventually an
integrator again, or may be a Venture CapitalSaaS startup and the last is't
clear either...
main product position: first a framework to do anything, then acomplete ERP,
even largely compared to SAP in your marketing lastyear, now a website builder
for dummies...
position toward community/partners: first in 2007-2009:"dear hackers, work with
us please, publish your modules andlet's create together the best open source
ERP, no catch!"Then by 2010: "hey give us money guys or we will ignore you
myfriends" Finally, kind of: "guys we will ignore yourmerges no matter what
now, but keep sending money by focusing onreselling our wonderful 70% margin
services please or we may kickyou out of the business you helped us building"
If you want people believe you are a strong company with astrong product, you
cannot afford to give the feeling you are goingwhere the wind is blowing.
Now, beyond any offshore headcount, we are all smallcompanies. Eventually
building the next ERP is largely beyond usall; this is why open source
community and even non profitfoundations are for.
2. Frustrations
I think 10 happy new SaaS customers are not worth a very angrypartner or
customer who invested in OpenERP and got frustratedlater by how it went.
Here is a concrete fresh example of what I mean but you canfind such example
every month or so:
http://goo.gl/U3O9X9
I participate to many open source projects and I see thatOpenERP is particular
in having quite a few frustrated people, evena few haters (sorryOpenERP etc..).
These guys typically invested alot in a way or an other and got frustrated at
some point. Hencethey make it a personal question to bash you.
You are not selling a simple product. On the contrary, an ERPis a very critical
product (even if you don't want to call itan ERP). That means people will
investigate (people who don'tinvestigate won't make a valid customer, they will
just failtheir project) and at some point sooner or later they will meetthat
frustration and IMHO it kills efforts to build a positivemarketing.
Even if they enter without knowing too much, in an ERPproject, shit will happen
sooner or later, then they will read thebug tracker or something else and they
will get the impression theyhave been lied as the image passed through the
marketing was kindof trying to hide these frustrations. Having the feeling
somebodylied you is really a reputation killer.
So what?
I'm not asking you to make everybody happy for free. Notat all!
We all have bills to pay and we know how it works. But I thinkOpenERP should
simply create less expectations and ensure it canlive with the economics it
means initially.
I think when you over-inflate the expectations artificially ina way or an
other, if you fail to deliver the "sorrySAP"you spent so much marketing
promising for instance, then there isalways a pay back later and I think it's
not worth the illusionof the initial easy going.
Are you sure you won't create new frustrations around yournew CMS and
e-commerce that you are already keen to compare toMagento and Drupal? What
makes you believe it?
3. Prostituted ecosystem
Of course, this is legitimate, you want to attract a few folksto your online
offer. But you have to do that with care!
I think when you try to give the image that OpenERP is"cheap", if you don't
take a lot of precautions inthe communication, then you just predate the value
of your productand your revenue network. That is you literally cannibalize
yourmain revenue stream to try to grow your new barely profitableproduct line.
For instance you now say "create a free website withOpenERP". This is catchy,
fine. But you know what, when a 20employees company invested (a lot) in a v6.1
or v7 project and seesthe current limitations of OpenERP, he really prefer to
see aperspective how the 2000 open bugs will be solved, or the patcheshe used
will be merged, or the pain he had to move from 6 -> 7is going to be less in
the future.
So when such a customer, o potential customer sees insteadthat OpenERP
frontpage is about building "free website",even if he is wrong (the WMS
refactor is fantastic), he cannotavoid thinking "these guys should be
kiddingman...".
When you pimp everywhere that OpenERP is full features andstarts at 39
euros/months, man, in developing countries at least,you create an army of
un-experienced joe coder guys who just startthinking:
"fantastic! I can do everything on OpenERP SaaS to managea company, and better,
I can download exactly the same software forfree! Man, I will start a business
locally and I will be so rich! Iwill compete with SAP and local ERP's with that
free software Iwas so smart to discover just now!"
So these guys start offering OpenERP on every website at coststhat are so
ridiculous while in fact THEY JUST DON'T IMAGINE atall there is work behind to
make it work in a given company.
So I mean, "professionals" think OpenERP is maturefor everything because the
message is that "anybody can manageany company on your SaaS". If it's so mature
and totallyfree to download the same, they will offer the same cheaper
andnothing will be left to fix the 2000 open bugs and other currentlimitations
or even just give you any sustainable revenue.
But what is the middle term effect of that? Well these guysfail an incredible
number of projects (different people each time),not only that spreads
frustrations a lot, but also, it predates thebusiness of your serious partners
who make success stories andbring you money. Here in Brazil I would say 95% of
the guys who tryto implement OpenERP fail, I'm serious, when there is no
budgetleft we always end up knowing about all these failed projects wecannot
rescue anymore because the folks just had illusions in firstplace.
And there is almost nothing to win for OpenERP SA with thesejoe coder guys you
know. If you take a few other open sourcesoftware that don't build a catchy
marketing, say Asterisk,PostgreSQL, SolR, whatever, well unskilled joe coders
just stayaway from it as they get it's not for them. Then noprostitution, a
healthy eco-system develops at its own pace.
Here in Brazil specifically, we struggled to grow in number ofemployees
compared to Akretion France. Main reason is the low levelof education here
(only 3% of guys over 30 went to university andnot always very good ones). And
because large companies likepetroleum or banking still make a lot of money,
then the verylittle elite can easily earn 3x (seriously) what they can
earnworking with IT for SMB's or they even just go outside ofBrazil for the
most skilled guys.
So okay, for once, this is 500 years non protestant colonizeddeveloping country
economics (please don't rebel you folks andkeep sending us the primary products
at banana cost). But also, wecertainly could never charge the price it really
cost here exactlybecause otherwise the mostly IT unlearned SMB's would
thinkthere is an alternative of doing it with X specially when X justsent you a
check to be partner and you just rewarded them with achocolate medal of being
official partners.
This is an irrational market like believing Santa Clausexists.
But you OpenERP SA, as an editor, you can CHOOSE to eithereducate that market
like for instance I did with the ERP whitepaperat Smile in 2008 (Smile in
general has been really good ateducating the open source market in France, at
least in the2000ties).
Or instead you can act in such a way that cultivates theignorance.
But this has a direct cost for you OpenERP SA. So forinstance, from the 15
partnerships you solds here, there is only 3guys left and may be some are yet
to leave. And these partnershipsyou sold quickly never turned into a
sustainable revenue stream aswith the European partners who developed before
some accountmanager policy would prostitute the market into something
notsustainable.
So among these 15 partners, as we "trained" them, Iwould say half where nowhere
close to be able to integrate OpenERPhere, or were unwilling to do the effort
(we have been penetratingthis market because we work like 70 hours a week for 5
years now,without holidays here and this is only at this cost that we woulddo
it). That is these are guys that were attracted by the catchymarketing but who
will potentially join the frustrated folks.
As for the other half, they eventually had the required skillsto start but
choose to stop partnership and in most of the casethey also just stopped
working with OpenERP.
In this later case, I think that this is because they ended upthinking it
wasn't worth the effort. Or that is, the overallprostituted market made of flow
the fresh unaware guys kept themaway from being part of the eco-system.
Okay, so I believe I said what I had to say about point 1, 2and 3.
Finally, when I talk with our Account Manager, I see that somefolks at OpenERP
think that a lot of companies are using OpenERPfor free without paying you a
cent and I even see some frustrationof OpenERP SA with that (you Fabien even
mention people usingOpenERP not paying as the main issue in your pad).
Well, first, this is pretty normal in the copyleft open sourcesoftware that
only a very tiny fraction of the folks pay yousomething. This has been true
with MySQL, with Redhat (hereeverybody uses CentOS free), with Java EE, with
manythings...
You have to live with it and properly design your businessmodel so that it fits
this reality. While time changed, Redhat forinstance did well with it. There
are also companies who are verysuccessful economically while still producing
free software that isabsolutely free and use by a tremendous amount of people,
37signals for instance.
You cannot change the nature of open source and GNU licenses,so you have to
ensure your business model fits this reality. Havingservices that are paid or
developing other non derived products (inthe AGPL sense) that are not free can
certainly be part of thesolution. Now, be careful because when you claim you
make 70% ofgross margin on some products (Enterprise you said), it meanspeople
have plenty of room to look for alternatives instead ofbuilding win-win
partnerships.
If I review services Akretion us to buy, like Amazonweb-services, I believe
none of these services are products with a70% gross margin, or we usually find
alternatives.
Remember open source is not about concentrating investment tobuild hypothetical
monopolies, it's instead about a free opencompetition of new ways to build
software at a fraction of the costof the legacy proprietary industry which
cannot let informationflows freely because it's so embarrassed by IP protection
andlegal bureaucracy. That is open source is about cutting costs bymaking the
right synergies between other ope source components (sayinstead of NIH) and
keeping reasonable margins that make happyconsumers.
So for instance I claim you could build an integrated CMS ande-commerce with
80% of the features at a fraction of the cost, notembarrassed by the AGPL if
you used the right existing buildingblocks. That is I say, "watch out the
attractiveness of yourproducts", but I'm consistent with that lower
revenuestream because I also say "you could do thatcheaper".
But mostly, I want OpenERP SA to understand that this is nottrue that so many
people are "cheating" your product likemy Account Manager seems to believe.
In fact, just like kids believe in Santa Claus, many companiesare just "TRYING
TO USE OpenERP". But when you know fromthe inside (
http://people.via.ecp.fr/~alexis/openerp/) what it takes to use OpenERP in
place of ERP X, you know thatthese guys are only TRYING. But they aren't able
to use OpenERPin place of ERP X. They are using it just as a CRUD repo,
wherethey would use Excell, MySQL+PHP, Access... a bit more only.
That is this is the very nature of the Internet, the culturethat "everything is
free". It created a generation offree loaders who just want eveything for free.
But you know what? These guys mostly have an usage of OpenERPthat is so limited
(at least here in Brazil for instance), that ifyou asked to charge anything,
they would just drop OpenERP andsimply go to the next item on their "free
solutions list"(Spreadsheet, MySQL, illegal copy of M$ Access etc..)
You would make a terrible mistake if you really believe theseguys are part of
the short term potential market and if you overscale your marketing to that
hypothesis.
Instead, you should acknowledge this reality and live with itIMHO.
And you know what? At Akretion I believe we produce even morefree software by
headcounts than OpenERP SA itself. For instance wemade 95% of the core
localization with mostly Renato and me and itweights 30% of the server layer of
OpenERP and Akretion made 4xmore mature free modules than just that.
So I mean, we really know what we are talking about, welargely have the same
issues as you have (many folks also use oursoftware without giving us a cent)
and at least this is my answerto the issues you raised in your pad.
All right. Happy you said you were at break even yesterday. SoI hope you will
consider that feedback and keep going in thegenerous mission of building free
software.
You know what, as one of the guys who invested heavily onOpenERP (not
financially, I mean personal investment), my biggestfear was that some of the
mistakes I depicted would throw you intothe hands of Venture Capital, liquid
capital, with no long termvision, no responsibility and no understanding on the
subtleties ofbuilding an unexpected business model atop of open source.
I would fear you would slowly climb that "long slow saasramp of death"
constantly throwing money into the fire bybuilding superficial "wow features"
to try to acquire newSaaS customers that would soon move away all the more
easily thatthis is free software, always running after your EBITDA figures
tokeep the show on:
http://businessofsoftware.org/2013/02/gail-goodman-constant-contact-how-to-negotiate-the-long-slow-saas-ramp-of-death/";
And I could imagine that at the end that ramp, shareholderswould of course have
the final temptation to forget the initialagreements with the community (the
non financial shareholders ofyour project) and have the temptation to try
closing the product,as so many other open source products did before.
So I really welcome the news you reached your break even and Ihope you will
keep doing good. Now, I wonder though, if everythingis going so right the way
it is, why would you suddenly opt formaking these marketing expenses you are
talking about in yourpad?
In any case, I advise you consider my points when doingmarketing: this is no
simple product, avoid catchy marketing fordummies and properly channel all your
communication to the righttarget.
All right, thanks to the ones who were courageous enough toread me!
Happy hacking with OpenERP!
--
Raphaël Valyi
Founder and consultant
http://twitter.com/rvalyi
+55 21 25162954
www.akretion.com
On Sat, Feb 15, 2014 at 11:03 AM, FabienPinckaers <f...@openerp.com> wrote:
Dear community,
Over the past years, we did not invest a lot in marketing. We putmost
our efforts in R&D and Sales departements (starting from 2010)and
services (started in 2012).
Things are changing and we are now ready to invest a lot inmarketing
activities. I just wrote a "very draft" internal documentto discuss the
brand positioning of OpenERP:
http://pad.openerp.com/p/r.Zzg7LhlqI7elyigb
I would like to have your point of view on these marketing thoughtsfor
OpenERP.
Thanks,
--
Fabien Pinckaers
CEO OpenERP
Chaussée de Namur 40
B-1367 Grand-Rosière
Belgium
Phone: +32.81.81.37.00
Fax: +32.81.73.35.01
Web: http://openerp.com
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