Peace, Love, and Profitable Ohana?

Welcome to The Margin, a newsletter designed to keep you on the leading edge of monetization.

In business, the difference between being ahead of the curve or slow to adapt is anything but marginal. The Margin aims to be the most useful, timely, and incisive ping that hits your inbox all week. It includes critical research and analyst insights to inform short and long-term decision making.

Here’s what you need to know:

Research spotlight | New MGI MarketLens™ Research Notes.

To help buyers make accurate, informed product comparisons, today MGI published three new MarketLens™ research notes: Agile Billing Agility vs. Complexity, Agility vs. Volume, and Complexity vs. Volume.

Billing Agility describes the flexibility to quickly configure and test new pricing mechanisms and introduce changes as dictated by market conditions. We define billing agility in terms of business, IT, and product agility.
Billing Complexity comprises the complexity of factors such as the product, pricing mechanisms, channel organization, payment platforms, regulatory compliance, cross-border capabilities, business rate of change, and more.
Billing Volume is measured in terms of the typical number of invoices generated per month (not number of transactions).
These MarketLens charts are also subdivided by market segment: HyperScale, Enterprise, MidMarket, and SmallBiz. The aim is to identify the suppliers that compete for similar users and compare like with like.

A Story You Can’t Afford to Miss | Peace, Love, and Profitable Ohana?

Last year’s tumbling share price and onslaught of activist investors brought renewed attention to Salesforce.
The company’s efforts to slash costs and grow profitability to appease investors has revived investor interest in the stock: CRM shares are currently up over 70% YTD.
Has Salesforce overcome its hurdles and put the rocky 2022 performance in the rearview mirror? Or will the CRM giant struggle to regain its organizational mojo and appeal with customers? What does this mean for the CPQ and Billing solutions which appear to be losing their luster precisely at the same time the Ohana is under pressure?

Tune Into MGI | Agile Billing Top 50 Webinar.

Tomorrow morning, MGI will host a webinar dissecting our recent Agile Billing Top 50 buyer’s guide. We will discuss the overall ratings process and methodology, the 35 vendors who earned MGI 360 Ratings™ + 15 “honorable mention” suppliers to watch, and a brief overview of the MarketLens data.

Register for the webinar here. If you can’t join us at 8am PT / 11am ET / 5pm CET tomorrow, don’t worry – a recording of the webinar will be emailed to you.

Now let’s dive a bit deeper.

Research Spotlight

A graph with Complexity on the x-axis and Agility on the y-axis

New MGI MarketLens™ Research Notes

The latest MGI MarketLens™ research notes plot the Agile Billing market in three different two-dimensional charts: Agility vs. Complexity, Agility vs. Volume, and Complexity vs. Volume. These research notes are intended to help buyers narrow the field of agile billing vendors they are considering to only the suppliers who fit their unique billing volume, complexity, and agility requirements.

The Agility vs. Complexity MarketLens plots Billing Complexity on the x-axis and Billing Agility on the y-axis. Companies with high agility and high complexity will appear in the upper-right quadrant, while companies with low agility and low complexity will appear in the lower-left quadrant.
In the mostly unlabeled sample Agility vs. Complexity MarketLens below, SAP achieves the highest Billing Complexity score, but the solution’s low agility puts it in the lower-right quadrant.
JustOn, meanwhile, achieves the highest Billing Agility score, but below-average complexity puts it in the upper-left quadrant.
BillingPlatform leads the upper-right quadrant with a relatively strong balance of Billing Agility and Billing Complexity.

Get the full MarketLens reports to access:

Labeled MarketLens charts that plot the agile billing market according to vendor agility, volume, and complexity. Find out how all 35 MGI 360 Rated™ suppliers compare in these crucial billing criteria.
Charts that plot the agile billing market by market segment. Compare HyperScale billing suppliers, Enterprise suppliers, MidMarket suppliers, and SmallBiz suppliers with their own direct competitors.
More detailed definitions of Billing Agility, Billing Complexity, and Billing Volume, as well as an overview of the quantitative methodology behind these reports.

Get the MarketLens reports here:

A Story You Can't Afford to Miss

Peace, Love, and Profitable Ohana?

The tech industry’s eyes have been on Salesforce in recent months, as several activist investors challenged leadership to trim costs and forced the business to focus on profitability. For a company that espoused its Ohana – a culture of collaboration, care, and fun (without regard for bottom-line costs), this approach is a shock to the organization.

Salesforce cut 10% of staff at the beginning of the year, and COO Brian Millham hinted that more layoffs are coming. The company also implemented performance metrics for engineering and sales teams, in addition to cutting costs through real estate divestments and prioritizing overall operational efficiency.
The focus on profitability seems to be working. After Salesforce stock fell 48% in 2022, this year has shown significant gains: shares have grown 75% YTD as of this writing.
The internal Ohana may not be the only ones to pay the price – the customer Ohana will be asked to pay more. Salesforce is attempting to raise prices. After announcing it will integrate ChatGPT into select offerings (AI Cloud service, Sales GPT, Service GPT), the company announced the list price for several of its products will increase by an average of 9% in August.

Ohana aside, customers have been feeling the effects of Salesforce’s sales culture rooted in Redwood Shores, not Oahu. Focusing on higher prices without communicating increased ROI and bottom-line benefits rarely goes down well with customers – regardless of sales culture.

Salesforce CPQ and Billing – solutions that typically deliver average business results at an above-average cost – will be hard pressed to deliver higher customer satisfaction.

The bottom line | Salesforce Billing ranks #29 out of 35 billing products rated by MGI. Given the focus on cost containment and lack of clear direction for the product, the future of Salesforce Billing is unclear.

Find out how we rate Salesforce’s billing product here.

On the Horizon

A dark blue background with the Buyers Guide text

Join us for tomorrow’s webinar as we discuss the Agile Billing Top 50.

This comprehensive buyer’s guide offers valuable insights into the evolution of agile billing, the suppliers with the best billing software on the market, and what exactly it means to be the best. It features quantitative MGI 360 Ratings™ of 35 top billing vendors – which score suppliers on their product functionality, management teams, channel organization, marketing strategy, and financial health – along with 15 honorable mention suppliers.

In addition to the vendor evaluations, the webinar will explore topics such as billing decision strategies, solution sourcing recommendations, success and failure in billing, and key functional requirements, among others. The webinar will also discuss the updated MGI MarketLens™ in Agile Billing and the new batch of MGI Use Case Notes™, which define the ideal user for each of the top 35 billing vendors.