In the July issue of Growth and Disruption, we profiled an Australian start up called Australian IT Market Place. Concepts are great, but how is their concept standing up now it has become a reality and they have launched.
As a refresh, the company was started to address two problems in the marketplace:
• Firstly, the suppliers of IT are investing literally hundreds of millions of dollars into finding new clients. Suppliers need to talk to many prospects to find the right one for their service, and that costs time, resources and money. Those costs must be recouped, and the only way to do that is for the supplier to add those costs to the fee of providing the service. The higher the inefficiency of the search for new clients, the higher the costs IT buyers must pay.
• Secondly, the buyers or users of IT services are used to dealing directly with IT suppliers who are most likely to only offer what they can actually supply. The question must be asked then: are there better solutions for their company that they are not being offered?
The Australian IT Market Place set out to solve these two issues, firstly to separate design and supply, so the buyers of IT received truly independent and vendor-independent advice. That is a major win for the buyers of IT.
The second part was to bring in the right suppliers when a buyer is ready to go to market. The Australian IT Market Place works with clients to understand and help build the business-requirements document, which then allows them to be matched with the right suppliers. Those suppliers are then invited to participate on the Australian IT Market Place panel for the opportunity. If they do not have a match in their database, they will source and introduce the right supplier.
A bid/tender process is run, and this competition always affects price. Importantly, the suppliers only pay a success fee when they win the business, reducing, and in some cases eliminating, the sales-and-marketing costs of searching for the right opportunities.
This is a big win for the suppliers, and if their sales-and-marketing costs are reduced, so is the fee they must charge, which is a win for the client.
So that was the theory. What is the reality?
Three months into a growth trajectory, the company is deliberately slowing growth to ensure the customer experience is maintained. The market has been incredibly accepting of the changes and have been quick to embrace a superior way of dealing with the right suppliers. In fact, the company states that the first year’s growth projections will be met within six months of the launch.
Suppliers are applying to join the panel, as they are genuinely excited about the opportunity to pitch their services to companies that actually want to hear their pitch.
So, has Australian IT Market Place disrupted the marketplace as they set out to do? CEO, Mark Hood, says, “It is more like we’ve helped the marketplace rather than disrupted it.”
Australian IT Marketplace