Readers know I disagree with the facile answer that businesses that use open source software need to "convert" their user community into customers. I've laid out my concerns in two blog posts over the past couple of years (here and here). Today, reading Matt Aslett's (always useful) 451 CAOS Links I came across this gem from David Skok on developing the JBoss business pipeline.
If I had to summarize my overarching concern with conversion discussions (and wearing my customer hat), it's that sales and marketing types confuse conversion with selection. They're trying to jump start leads by applying historical pre-web lead qualification thinking in a world where the web allows potential customers to self-educate and then self-select. The process and thinking that goes into this JBoss case study isn't simply good for open source related business strategy. (I really wish we'd had this level of process and the tools to support it 15 years ago when we started Softway Systems.) Quotes that stood out for me:
The first question we looked at was: Did they know the names of the people that had downloaded their software 5 million times? The sad answer was no. Not only did SourceForge not allow them to collect names, but even if they did allow it, there was clear evidence that developers would simply not go through with the download if they were asked to provide their name.
Following one of the key principles of this methodology, we immediately realized that they needed to find a motivation to get the customers to provide the company with their contact information. The best motivation appeared to be the documentation, that they were currently selling. There was one big problem: selling the documentation was resulting in $27,000 per month in revenue, which was paying the rent and several peoples’ salaries. To me it was obvious that this was a small price to pay to get the names, but to the JBoss team, who had battled their way to get every dollar of revenue, that was less obvious. We debated this issue over the next three months, but finally they gave in and switched on the offer. It turned out to be a huge success: over 10,000 leads started pouring in every month. Over time this grew to 16,000 leads per month.
And ...
Later on the process, JBoss was able to look back at the customers who had actually bought the product and close the loop, by testing whether they had predicted the right events as qualification events. They did a lot of analysis to refine the events based on this information. Several of the original assumptions, based on common sense, turned out not to be true. For example, the amount of time that a lead spent on the website had little impact on their likelihood of becoming an opportunity or a closed deal. The same was true for time spent using the Wiki or the Forums.
Here was a process used specifically to "weed out" (qualify) customers from the noise of lead potentials in user and developer communities using the web site. The entire article is worth reading and careful consideration within your business. This is how JBoss "went on to reach an annualized bookings run rate of about $65 million a year within two and a half years after starting the process." Execution requires the right team, but it also requires the right process.
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