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The Global B2B Arena. James MacAonghus Analyst, Jupiter MMXI. Agenda. The Heavyweights: Industry Sponsored Markets The State of Technology Early Days in Europe. The Heavyweights: Industry Sponsored Marketplaces. ISM Progress Should Follow Key Steps. Establish leadership
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The Global B2B Arena James MacAonghusAnalyst, Jupiter MMXI
Agenda • The Heavyweights: Industry Sponsored Markets • The State of Technology • Early Days in Europe
ISM Progress Should Follow Key Steps • Establish leadership • Form a separate legal entity • Establish a capital structure • Select a technology vendor • Create business and revenue models Page 3 of 22
ISMs Make Significant Progress Towards Live Transactions Page 4 of 22
ISMs Exhibit Stunning Speed; 74 Percent to Go Live by Year’s End Source: Jupiter Research (10/00); n=63 (US only) Page 5 of 22
ISMs Seek Efficient Supply Chains, Not Lower Prices or Broader Reach • Online collaboration is a key goal • Back-office integration required • Marketplaces provide single connection to multiple trading partners • Chain-wide visibility • Anti-trust issues Page 6 of 22
Supply-Chain Efficiency vs. Cost Savings as Value Propositions Supply-Chain Efficiencies Procurement Efficiencies Expanded Customer and Market Reach Value Propositions Cost Savings Save Time Community/Relationships Better Pricing Percentage of Respondents Source: Jupiter ISM Executive Survey (10/00), n=30 (US only) Page 7 of 22
Incumbents Felt They Alone Could Drive Liquidity to Net Markets Internal Drivers Percentage of Respondents Source: Jupiter ISM Executive Survey (10/00), n=30 (US only) Page 8 of 22
Ariba Fared Best in Signing Deals to Provide Technology to ISMs Source: Jupiter ISM Executive Survey (10/00), n=30 (US only) Page 9 of 22
Integration Cost a Major Issue Source: Jupiter Research (10/00); n=63, (US only) Page 11 of 22
Cost of Net Markets – Higher US Costs Reflect Greater Maturity … Source: Jupiter Research (10/00); n=63, (US only) Page 12 of 22
… in Europe, Custom Way More Common Than Package Software Page 13 of 22
Functionality Needs Depend On Buyer’s Relationship With Seller Buying From Existing Suppliers Buying From New Suppliers Buyer Market • Informational over transactional • Fewer deals per participant • Better for commodities than custom goods due to complexity of purchase • Catalogue technology • Search technology • Transactional over informational • Lots of deals per participant • Purchases often supplier -specific due to performance requirements • Data mining • Product/order manipulation Buyer Need Source: Jupiter Research Page 14 of 22
Faint Glimpses of Online Collaboration • Developer Community - Catapulse • Planning, Forecasting, Restocking - i2, Ariba • Cross-industry - Noosh • Inter-department – Mercata Vendors - i2, OpenText, Catapulse, Manugistics, Adaxa, Exterprise, Agile Page 15 of 22
Integrators / ASPs Serve Different Audiences • Evaluate specifically against requirements • Lean, mature vendor management team • Brick and mortars – avoid ASPs now • ASPs – focus on race for ERP, CRM, SMEs Page 16 of 22
Many Clamour For Attention Page 18 of 22
Net Markets Not Yet Ready for Action Page 19 of 22
Early Value Added Services Complete Transaction Process Which of the following features and services do you plan to add in the next 12 months? Percentage of Respondents Source: Jupiter Executive Survey (10/00); n=90, (US only) Page 20 of 22
Internet Immaturity Remains Main Barrier What are the main barriers to getting a critical mass of participants onto your Net Market? Page 21 of 22
Treat Small and Medium Enterprises With White Gloves What size companies are you targeting? Page 22 of 22
Thank you jamesm@jup.com
The Biggest Market Exists for Enabling Partners to Trade Online Does Not Exist Big Market $$$ Own Transaction Role for New Online Entity Huge Market $$$$$ Facilitate Transaction Medium-to-Small Market $ Buying From New Suppliers Buying From Existing Suppliers Buyer Market Source: Jupiter Research