Friday, January 19, 2007

Open Source as a Marketing Strategy and a Compiere Blog

Lately, I have been thinking about the different ways that an open source business model can benefit the companies that base their businesses on an open source product. Although there are many benefits, one of these benefits is that open source can be used as a marketing strategy. I blogged about this idea in some detail on the new Compiere Blog, and here is an excerpt:

Since Compiere is freely available for download, anyone can install the software, try it, and see if they want to use it in their environment. Many of these people will never generate any revenue for Compiere, but maybe they tell a few other people about Compiere, and maybe those people tell a few more people ... This viral marketing helps to promote and market open source products with little involvement from companies like Compiere. Having an open source business model can generate a level of awareness that might otherwise cost a substantial amount of money to achieve through trade shows, advertising, etc.

Using open source as a marketing strategy requires a shift in thinking for anyone coming from a proprietary background. As open source companies, we need to encourage people to download our software for free – the more, the better! It does not matter to me that someone gets our software for free without paying Compiere a dime. Yes, they are benefiting from our hard work without giving anything in return, but all I need is for them to tell someone who will eventually want to attend training or purchase some type of support or other services from Compiere.

Open source companies also need to be a bit careful not to be too heavy handed with pushing people into revenue generation. We cannot (and do not want to) force people into purchasing support agreements or other services, because this would severely limit our ability to benefit from open source as a marketing strategy. Instead, we need to provide compelling services (support and others) that benefit our customers. Those customers who need and want our help will pay for it. (Quote from the Compiere Blog)


Anonymous said...

Open source is great for everyone! I use Joomla! and a few other freeware/open source programs and applications and it's amazing as to how under rated these tools are. I enjoyed your post!

Anonymous said...

Also, the introduction of Windows Vista into the market may create opportunities for open source software and hardware to gain market share in the health care industry! I have read articles that suggest that the requirements mandated towards hardware vendors will increase costs for PC owners who want to view or listen to premium content. In addition, it may cripple a user's ability to access premium content on open source systems, such as Linux.

If this is indeed true, then industries, such as health care and other business sectors not reliant on premium content solutions, may look for cheaper and more reliable alternatives in the open source community.

Although Linux may not be able to access premium content, it will be free of the overhead that Windows Vista will require; thus, the lack of this overhead represents just one more eliminated barrier in hospitals switching from proprietary solutions to open source.

This article contains more information on this topic:

A Cost Analysis of Windows Vista

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