Value, not greed! How a business software vendor translates SMB success into the enterprise

Thomas Wieberneit
5 min readMay 31, 2023

Zoho is well known as a vendor for business applications geared towards SMBs. As many other companies do, Zoho wants to support the upper mid-market and enterprises, too. After all, successful SMBs may grow into become enterprises and that might attract other enterprises. So, there are a good number of good reasons to also support upper mid-market and large businesses. The company has actually followed this path for about five years and has set up an enterprise business solutions team to deliver solutions for enterprises.

Still, it is a better kept secret that Zoho already has considerable momentum in the upper mid-market and enterprise segments. Zoho achieved a 65 percent year-over-year growth. The enterprise segment now represents about one third of the business.

During its signature event Zoholics in Austin, the company on May 4, 2023, changed this and revealed its enterprise strategy . This strategy ultimately rotates around four pillars: Go-to-market, platform, new applications and enhancements, plus security and privacy.

Zoho also backed up its continuing success story by inviting some customers to present their journey with Zoho as a panel and talking individually to analysts and media.

Marshall Lager and I had the opportunity to speak with Zoho’s head of CX marketing strategy, Prashanth V K . We had a lot of questions and opened up with a barrage about what the customer profile for the Zoho enterprise business is. The interview can be watched .

Starting with the definition of mid-market: Zoho defines mid-market companies as companies ranging from one hundred to one thousand employees; and Zoho has considerable momentum in this range of companies. In conclusion, enterprises are above this threshold. The second consideration is complexity, which tends to increase with size. Revenue is no consideration, as this is too volatile across regions and industries.

Add growth into the equation and Zoho naturally expands into the enterprise sector. With its platform, Zoho facilitates business growth, and grow Zoho’s customers did, as they could concentrate more on their business, as opposed to their business systems. As Prashanth maintains, “ It was a natural logical extension “ for Zoho. For some years now, Zoho addresses the enterprise market more strategically, by building internal capabilities like account management, customer success, onboarding, implementation capabilities, etc., that are bundled in an Enterprise Business Solutions unit. To increase its reach and implementation abilities, Zoho also established and continues to establish partnerships with SIs around the world, enabling them to sell the simplicity of the platform and therefore drive value for their customers, including a focus on industries, while Zoho focuses on the horizontal platform “ to make it efficient for partners to build the vertical solutions “. These partners are also increasingly brought in to deals. This is crucial to increase trust in the SI ecosystem. Joining forces like this also helps making a successful bid as this demonstrates product-, industry- and delivery experience in a cooperative setting. It shows one face to the customer.

The starting focus was on global SIs. As Prashanth notes, Zoho wants to regionalize the go-to-market approach and “ to eventually establish regionally relevant partnerships “. This allows Zoho to deliver more and better industry solutions, as regional implementation partners not only have deep regional but also deep industry experience.

The third factor taken into account is product maturity. Here, the CX line of solutions is certainly leading. Additionally, Zoho being Zoho, it is also about where customers see value. “ We’re also seeing, based on the region, a certain amount of larger enterprise traction for various products. Some prefer our finance products some our employee experience products. In some cases, our workplace productivity and collaboration platforms as well “ says Prashanth, continuing, “ There’s a whole ton of no code and local extensibility that we already offer as well. So, we are able to punch way above the weight of an individual product. If you take an individual product to put it under a microscope, you may find that it may fall short in some cases in terms of Enterprise. But because of this vast layer of extensibility, we’re able to jump in and cover those .”

Lastly, by continuously analyzing use cases across industries for commonalities, Zoho can bring back commonalities into its horizontal platform, making them available to all customers. The result is that customers need to maintain less and less custom code, as more and more of these use cases are already covered in the horizontal platform without harassing partnerships. This, again, increases the value of the deployment.

All this boils down to the platform. It provides the simplicity that enables businesses to move fast while not depending on the IT department. That way, business decisions can be taken faster, changes can be implemented faster and important personnel can be assigned to do more beneficial and less onerous work to enable the business to enter new avenues of growth. In some instances, where Zoho replaced another software, the customer was able to “ maintain the Zoho deployment, with, as many as 10x fewer people, something like that up to 10x fewer people “, which is an extraordinary display of value.

In summary, Zoho has and continues to evolve around two main axes, technology and target customers. From a technology point of view, there is a move from single applications to solutions and platform, while the addressable market grew from small businesses to now also include enterprises. This evolution revolves around value for customers, driven by a good customer experience.

Or in Prashanth’s words: “ the thing with Zoho is that we’ve spent over 20 years, building out this vast mountain of capabilities. I may say that we’ve also successfully transitioned from a product mindset to a platform mindset, six or seven years ago. And from there, we’ve transitioned from a small business mindset, largely to an all-business mindset where we do have to approach each segment with the customer experience requirements that it deserves. And the one thing that remains constant across all of these, is the Simplicity that we bring to the market, to the customer to the customer experience to all of this, right? That Simplicity is that is the core tenet, which we want to be identified and we want to be the vendor who simplifies the CX stack or the EX stack, or the workplace stack when large organizations move from their incumbent vendor to us. “

Originally published at https://aheadcrm.blogspot.com on May 31, 2023.

--

--

Thomas Wieberneit

Helping businesses to improve in Digital Transformation, Customer Engagement, Customer Experience, CRM, Innovation