Become the Customer of your Cloud Vendors’ Dreams
Take control of your cloud vendor negotiations by becoming the ideal customer.
You don’t have to look far to find blogs, ebooks, white papers and videos galore about what customers want from their cloud providers. But what about the other way around?
Understanding what cloud vendors want from their customers is crucial for any business planning long-term use of their cloud providers. If you’re the ideal cloud customer, it puts you in a strong position to negotiate favourable contracts and renewals with your providers.
So, how do you become the ideal cloud customer?
Spend a lot
Let’s get the most obvious point out of the way first. Cloud Service Providers – like any business – want to make money. So naturally, if you spend a lot as part of your contract, you’ll quickly curry favour with them.
But it isn’t just enough for this number to be high; it also needs to grow over time. Customers with a growing Annual Contract Value (ACV) are key targets for many cloud providers. In particular, cloud vendors are also heavily incentivised to get cloud customers to grow to the magic ACV number of $1M.
It’s worth keeping the need for growing ACVs in the back of your mind as your business considers its cloud roadmap, and what new services you want to roll out in the future.
Use your service
While having a customer under contract is great, cloud vendors also want organisations to actually use the services they pay for.
That’s because customers that use cloud services are far more likely to stick with them and, crucially, are more likely to sign up for new services in the future. Again, it ties back to the constant drive to increase customer ACVs.
Get executive buy-in
When enterprise cloud solutions were in their infancy, they were traditionally sold in via the IT department. After all, they were a technical solution, so it was best to talk to the most technical people in the organisation about them.
However, as digital transformation becomes an organisation-wide initiative, cloud vendors are increasingly looking to sell to line of business and IT executives alike.
If you can assure your vendors that even your non-IT leaders are invested in the solution, they’ll know your business takes the cloud seriously and is ready to grow its cloud footprint.
Why isn’t everyone a great cloud customer?
So, if it’s as simple as doing these three things, why isn’t every organisation the ideal cloud customer?
While purchasing a cloud solution is (in theory) as simple as signing up and sending a payment, successfully connecting to a cloud solution isn’t always as simple.
For many cloud solutions, particularly those that support critical business processes, public internet connectivity isn’t performant or reliable enough. While you can use physical cross connects (XCs) to overcome these issues, they are expensive and inflexible – making you less likely to provision them on new services.
Without an agile and flexible way to lay down XCs, it can be a challenge to spin up new cloud services. (Doubly so if you’re looking at new cloud providers, or looking to deploy solutions to sites in new geographical areas. And that’s assuming your provider of choice even has servers in your new territories.)
And if you can’t adopt new solutions quickly, you’ll see your cloud usage, your executive buy-in for cloud and your ACV drop.
Without those three key elements, your negotiating position will be much weaker when it comes time to discuss new cloud contracts or renew existing services.
Become the customer your vendor dreams about
Becoming the best cloud customer and getting the most favourable negotiation terms all comes down to how flexible your connectivity is.
That’s where we come in. At Megaport, we bring flexible, software-defined connectivity to organisations around the world. Our Megaport service can help you quickly connect to a whole host of cloud providers through a single cross connect – even providers that don’t normally host data centres in the countries you operate in.
And with our new Megaport Cloud Router solution, you can connect directly between cloud providers as part of a multicloud strategy or establish a virtual point of presence to bring cloud data centres closer to your business.
It all adds up to a more flexible way to connect. And with that flexibility comes an easier way to use cloud services and grow your ACV – and build a stronger negotiating position with your cloud vendors.