Wednesday, October 29, 2008

Open Source Marketing Metrics - From 0 to 700 Customers in One Year

One important goal of open source software is to drive rapid adoption of a new product. Effectively, open source downloads become a marketing channel for producing qualified sales leads.

Yet there are not many metrics available by which to judge the success of an open source channel. What percent of web site visitors should download the product? What percent of downloads should register in the community? Finally, the all-important question: what percent of registered downloads should convert to paying customers?

We have been tracking downloads and conversions religiously (with lots of help from smart people like Marten Mickos at MySQL, Brian Gentile at JasperSoft, Rod Johnson at SpringSource and Andrew Aitken at the Olliance Group). I thought it would be useful to summarize what we are seeing in our community around downloads, product adoption and conversion to paying customers.

Metrics since product launch (3/08)

The punch line is that WaveMaker will have over 700 paying customers by the end of the year, both through direct community adoption and through channel partners.
  • 29,261 web visitors per month
  • 9,972 downloads per month (28% of visitors)
  • 1,132 download registrations (e.g., new community members) per month (11% of downloads, 4% of visitors)
  • 600 community postings per month (11% of downloads, 4% of visitors)
  • 1,050 marketing leads per month
  • 700 paying customers by 12/08 - including direct and channel customers (through OEMs)

What Drives Web visitors?

WaveMaker is an easy to use development tool for web applications. Our motto is: if you can use a browser, you can build a web app with WaveMaker. The main driver for WaveMaker web visitors is new product releases. With each new product release, the open source network springs into action via sites like SourceForge and FreshMeat, as well as specialty sites like dzone and Ajaxian.

For three weeks after a new release, we see the web site volume goes up by a factor of 5 over the previous 30 day moving average. After that, web traffic settles down to a new, higher level (typically about 20% higher than the previous moving average).

What Drives Download conversions?

The percent of web visitors who download has inched up from roughly 20% of visitors to 28% of visitors as we have gone through various iterations of our home page. As the messages have gotten simpler and the graphics more compelling, the download rates have climbed.

What Drives Community conversions?

So far, conversions from download to actually registering with the community has been our Achilles heel. One interesting metric is that the conversion rate goes down when the download volumes go up and we aren't really sure why (could be as simple as the Drupal registration engine getting backed up).

Converting Open Source Downloads to Customers

Once developers have registered with the community, they get regular newsletters and emails from our field technical people. We have found that by far the most effective marketing activity is our personal emails from field technical people to potential enterprise prospects. Instrumenting our email outreach program is another important todo for our marketing team.

These conversion numbers are pretty lumpy - a small number of channel partners can have a big impact on customer numbers, particularly at the beginning. Most of our leverage at WaveMaker has come from small systems integrators and ISVs, both of which act as channels to amplify the activity that is already being generated by our open source channel.


Converting web visitors into paying customers remains more of an art than science. What we have proven is that for enterprise software, it is possible to attract a large number of paying customers in a short time using an open source channel.

Thursday, October 23, 2008

What is NOT Cloud Computing?

I spoke at the Cloud Summit last week put on by M.R. Rangaswami and enjoyed as always the giddy enthusiasm with which Silicon Valley embraces each new technology wave. Cloud computing is custom made for Silicon Valley - it is poorly defined, seemingly vast and has the potential to change human life as we know it (at least for those of us who live in Silicon Valley).

Of course, we have our fair share of naysayers (like Larry and Richard), as well as theories about why those naysayers are down on cloud computing.

Since so many people are jumping on the cloud bandwagon, I thought it would be useful to look not at what cloud computing is but at what cloud computing isn't.

Cloud computing is the hardware equivalent of automatic teller machines. The whole idea is that you don't have to deal with people to get your application deployed, scaled, monitored and managed. Therefore anything that gets between your application and the API to the data center in the sky is taking you away from the cloud.

The other important - and to date largely unrealized - promise of the cloud is choice, aka freedom from lock-in. Today, customers are often locked into a particular cloud provider just as surely as they are locked into their in-house data center. Moving forward, you should have the ability to change clouds providers as easily as you change cell phone providers.