The two strongest customer acquisition techniques used by OSS vendors today are in serious decline. How to respond?

Yesterday marked a an exciting milestone for the PAOSS business. We made our very first commission payment to an affiliate whose introduction led to a payment arriving in our account (for providing our services). This occasion is far more than a mere financial transaction; it symbolises a significant step in our journey to strengthen our network of partners and advocates. Don’t worry, this article isn’t just your boring humble-brag, we promise we’ll bring it back to what we believe is an important point about/for the OSS world too. That is, the two strongest customer acquisition techniques used by most vendors are in serious (terminal?) decline. This is a major problem for the OSS/BSS industry, so a solution needs to be found. But more on that shortly.

For many years, we’ve seen the most important role of PAOSS is as a connector. To connect buyers, sellers, people, ideas, projects, technologies and much more. To help establish connections that others simply can’t make, whether that’s through not knowing a person who can become a significant influence in their business, or just generally in relation to connecting dots that they haven’t seen yet. We do a vast majority of these connections at no charge, but connections also form an important part of offerings such as our Vendor Selection Processes that bring buyers and sellers together.

Back to the main thread here. There are a couple of major trends coming through as waves that are hitting all industries and having an impact on the way we all do things, with ramifications for the world of OSS too.

Push Marketing (also known as sales) is becoming increasingly difficult for OSS Vendors (and salespeople the world over). Think about your own reactions these days – if someone reaches out and tries to sell you something unsolicited, your first reaction is to put up barriers. I know a lot of prospective OSS Buyers who won’t accept connection requests from OSS suppliers on LinkedIn because they just expect that the next step will be to receive a pitch request. Part of the reason we’re so fast to put up anti-sales barriers these days is because there’s such great information online. If we want or need something, we can do our own research.

This is where Pull Marketing comes into play. It’s the gravitational pull of Buyers towards Sellers. The Buyers have done their own research, they’ve spoken with friends and colleagues, they’ve done their side-by-side comparisons, they’ve filtered some sellers in and some sellers out – and only then do they reach out to their short-list of sellers. We do this in our personal lives, but it’s also becoming the playbook for OSS procurement too. The concept of gravitational pull is an important one. I really like the following diagram (from Chad Barr Group) to highlight the gravitational effects that help with pull marketing:

Marketing gravity is really just another way of describing how to get attention. It’s not suggesting that you should (or even can) do all of these gravitational drivers, but it does provide a useful hint for identifying which gravity effects could be most relevant for your business.

One things we’ve observed is that of the 500+ vendors in the OSS/BSS market, a vast majority are great product companies, but not so great at marketing [as an aside, it was one of the main reasons we created the OSS/BSS Vendor Directory – to shine a light on the many awesome OSS/BSS products out there that would otherwise never be heard about]. It’s difficult to get leads, and getting more difficult due to the “push marketing pushback” we discussed earlier.

But the big challenge now is that GenAI is also disrupting the pull marketing world. Many companies, especially OSS suppliers, are heavily reliant on SEO (Search Engine Optimisation) to attract buyers to their information, which in turn allows Buyers to conduct pre-analysis before reaching out to their short-list of OSS suppliers (the pull marketing cycle at play). With more OSS buyers going to GenAI, and less to search engines, the concept of SEO becomes increasingly less relevant or effective.

Therefore SEO, arguably the strongest of the “active pull marketing models” (active in terms of you having an ability to do something about it), is diminishing in effectiveness [as another aside, interestingly, we’ve never used an SEO strategy at PAOSS per se. We just like writing articles (over 2,750 so far) that happen to have lots of SEO-worthy OSS/BSS words included. But we can already see the impact of less attention coming via organic search].

So, OSS/BSS vendors’ two strongest customer acquisition tools – push marketing and SEO – are degrading quickly. What to do next?

Word of mouth has always been by far the strongest customer acquisition technique of all. If a friend or colleague recommends a product or service, then you’re far more open to looking to them as a viable solution to whatever problem you’re experiencing. This is where connections, networks, affiliates, etc come in. They tend to be a bit more passive and opportunistic by nature, but increasingly important nonetheless. And they only happen when you can remain front-of-mind in the vast network of contacts that are seeing new opportunities each day. If you’re not front-of-mind and they’re not able to connect the dots, then your connection won’t be able to link the opportunity back to you (ie a missed lead-gen event).

The two-lung approach. In the past, we always believed that word of mouth and opportunities came about through delivering outstanding technical service / outcomes (lung #1). That’s still true, but the increasingly impressive technical information presentation by GenAI is slightly diminishing lung #1 as a key differentiator. Therefore, the act of gaining more widespread attention (lung #2) is arguably becoming more important than ever. And the traditional techniques for gaining attention are fading in relevance.

We’d love to hear your thoughts, what you’re doing to overcome the evolving attention challenge and how you see this playing out. Finding better ways to match-make buyers and sellers, or to enhance our role as a connector more generally, is constantly top of mind for us, so we’d be delighted to talk with you about it too.