Fighting the Recession with a Single-Product FocusBy Pedro Pereira | Posted 2008-12-02 Email Print
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Solution provider GetConnect rides the economic storm by selling only one product that leverages hot trends like SAAS, Web conferencing and green IT. GetConnect wins business through sales of and services for Adobe Connect Pro.
Greg Anderson believes he has the business model for all economic seasons: His company sells a single product.
Forget PCs or servers, operating systems or applications. GetConnect, the company Anderson founded three years ago and of which he is president, does nothing but sell and service Adobe Systems' Connect Pro Web conferencing and e-learning solution.
That makes the Dallas-based solution provider a rarity. It's not unusual for a solution provider to have a narrow focus on a particular technology or even a single vendor, but a single-product model is, well, singular.
Despite the inherent risks of a single-product model, Anderson is sticking with the approach. It has served him well through the good economic years, and now that the economy is down, more and more customers turn to Connect Pro as an alternative to costly business trips and on-site training, he says.
"We feel very fortunate, knock on wood, that his product seems to play well in a recession," Anderson says.
In addition to cutting travel costs, Connect Pro also is affordable to run. Available as a hosted application through a SAAS (software as a service) arrangement, it requires no complicated, costly on-site deployments.
And for customers concerned about the environment, the product offers a green component: It curbs carbon emissions by cutting down travel.
Recalling the launch of GetConnect in late 2005, Anderson says he saw a great market opportunity for Connect Pro.
"This wasn't something I put years of planning into," he says, which is a bit of an understatement. In truth, GetConnect was founded by happenstance.
Here's how it all went down: Anderson had worked at Macromedia, the company that developed ConnectPro under the name "Breeze," for about six months when the sale of the company to Adobe Systems was completed in December 2005. Anderson had been assured his job was secure before the sale closed, but a couple of weeks after getting that assurance, he was laid off.
He could have despaired, but instead decided to set himself up as a Connect Pro solution provider. A couple of Adobe colleagues, including Ian Justin, who is vice president of technical sales at GetConnect, agreed to join him. One week after the sale closed, GetConnect opened for business. That was on Dec. 12, and on Dec. 21, the company did its first Connect Pro demo for a prospective customer.
Today GetConnect employs nine people and serves some 600 customers. In its first year, GetConnect had revenue of $4.3 million, jumping to $6.5 million in 2007. Anderson expects to top $7 million in 2008.
The company sources Connect Pro from distributor Tech Data, which has seen its share of business models among the thousands of solution providers with which it does business. But ask a handful of Tech Data sales reps to name more than one single-product-focused solution provider, and they draw a blank.
"At first blush, it may seem like a risky move to focus on one particular product or product line," says Stacy Nethercoat, Tech Data vice president of software product marketing. But, she adds, focusing on a single product and bundling services around it can translate to healthy margins and being recognized as an expert in a particular technology.
Anderson believes his company has done so well with just one product, often topping the list of Adobe channel partners on sales, because of several factors. For one thing, he says, Connect Pro is a great product.
A competitor to WebEx's offerings and Microsoft's Live Meeting, Connect Pro offers an interface resembling a Web portal and is used for business meetings and classroom settings, allowing users to author shared content.
"Pretty much everybody we talk to is blow away by the Adobe product," says Anderson. "They absolutely love it."
Aside from the product itself, Anderson attributes his company's success to experience. The team he assembled to run GetConnect, including his wife, Shannon Anderson, who is vice president of operations, consists of middle-aged people with lots of experience in the IT industry.
At Macromedia, Anderson ran western regional sales, and before joining the vendor he had owned a company reselling other Web communication applications.
Tech Data's Nethercoat believes selling a single product is an opportunity with a time limit. "The opportunity to focus on one product or line will not last forever, but savvy VARs can make the most of it while it lasts," she says.
But Anderson isn't worried. As long as the product's quality remains high and the need for Web conferencing and distance learning continues, he says, there is plenty of business to be had.
"The demand for what this product does isn't going to go away any time soon," he says.