AWS Marketplace’s New GM: More Vertical Solutions, International Expansion On Tap

AWS Marketplace has grown to more than 1,600 ISVs offering 10,000 subscribable product listings in 50 categories, compared to 1,400-plus ISVs and 4,500 listings in 35 categories in 2018, according to newly appointed general manager Stephen Orban.

Private marketplace innovation, more industry-specific solutions, improved governance and international expansion are among the focus areas for AWS Marketplace this year, according to the new leader of Amazon Web Services’ digital catalog of third-party software solutions.

“I’m just super excited to really be in the middle of helping customers as they migrate to the cloud and modernize their IT estate faster by complementing what they’re doing on AWS with the partner solutions that we have on Marketplace for software, data containers, machine learning models and now also professional services,” said Stephen Orban, the newly appointed general manager of AWS Marketplace, Control Services and Data Exchange.

Orban has replaced Dave McCann, who led Marketplace for 6.5 years and has moved into a strategic consulting role with AWS as vice president of engineering for special projects. Orban formerly served for three years as general manager of AWS Data Exchange, a service launched in 2019 that makes it easy for AWS customers to find, subscribe to and use third-party data in the cloud through Marketplace.

“We’re seeing a lot of demand from partners in more vertical industries for more verticalized solutions, where they also want to start to reach the customers who have more industry-specific use cases, particularly with the software and data together,” said Orban (pictured above).

Nashville-based Change Healthcare, a healthcare technology company and AWS Advanced Technology Partner, has both data and APIs available on Marketplace for healthcare customers. Another AWS Advanced Technology Partner, Experian, an information services provider based in Dublin, Ireland, has machine learning models listed on Marketplace and is starting to get traction with financial service customers using them for predictive analytics.

“We’re kind of pushing the boundaries of how a lot of our product types like data and machine learning could work together and potentially be sort of bundled and used together by different customers,” Orban said.

AWS Marketplace also is continuing to focus on international expansion as demand for cloud services continues to grow internationally.

“Every time AWS launches a new region, Marketplace is a required service that needs to be there,” Orban said. “We get a lot of push from both ISVs (independent software vendors) and customers to continue to expand internationally. We’ll continue to add more…sellers of record, so sellers from different countries can more easily register from within their country. We added Japan, Australia and Bahrain over the course of the last six months to a year, and we’ll continue to expand in that space.”

AWS will double down on customers’ requests for better and more management and governance features for solutions they’re deploying from Marketplace. During the virtual AWS re:Invent conference in December, AWS launched management entitlements for AWS Marketplace, which enable buyers to govern, track and distribute entitlements from a software license.

“That’s a feature that no other cloud infrastructure marketplace has,” Orban said.

In January, AWS also gave customers the ability to create multiple Private Marketplace catalogs of approved software that their teams are allowed to procure from the broader AWS Marketplace. The new capability came a little more than two years after AWS enabled customers to create a single Private Marketplace per AWS account to control what their business and engineering teams could buy from the Marketplace.

“We have a little bit more innovating to do around private marketplaces and better governance to help merge that up with our management entitlement feature and a number of other capabilities we have there,” Orban said.

AWS Marketplace Growth

Launched in 2012, AWS Marketplace is designed to simplify the procurement, entitlement and provisioning of third-party software from ISVs. It has grown to more than 1,600 ISVs offering 10,000 subscribable product listings in 50 categories, compared to 1,400-plus ISVs and 4,500 listings in 35 categories in 2018.

AWS also has added eight more cloud regions where AWS Marketplace is available since 2018, bringing the total to 24 regions. AWS Marketplace also connects customers with more than 500 registered consulting partners.

“From a customer adoption perspective, that’s grown to more than 2 million subscriptions from more than 310,000 active customers,” Corban said.

Privately negotiated offers between ISVs and customers has been one of AWS Marketplace’s big growth areas, according to Orban. First introduced in 2017, private offers allow ISVs -- and now their designated resellers -- to negotiate custom prices and end-user licensing agreement terms for customer software purchases in Marketplace.

“What we found was that customers love that self-service experience (of AWS Marketplace), but as they get some of these partner tools into more sophisticated workloads and want to use them more broadly across the enterprise, it often becomes a much more significant financial commitment,” Orban said. “They want to be able to negotiate, whether it be custom terms or pricing -- and, in practice, that’s usually both -- with ISVs.”

Last December’s addition of professional services to Marketplace also has been a big mover for AWS, according to Orban. AWS consulting partners, ISVs and managed service providers now can quote and bill labor as professional services directly through Marketplace, including assessments, implementations, managed services, and premium support and training to help customers with their cloud software purchases.

“We’ve got more than 500 channel partners today who wanted a more automated and scalable way to both work with ISVs and sell on their behalf to our customers, and then to have our customers get services with it,” Orban said. “We definitely continue to get the demand signal from customers that they want to have the professional services listings alongside the software, so that they have the contracting and negotiation in one place (and) they can get their software set up and integrated into their environments as quickly as possible.”

AWS Marketplace During the Pandemic

The coronavirus pandemic has forced a lot of organizations to innovate, and AWS has seen companies including Adobe and IBM launch software listings in Marketplace as extensions of their sales organizations.

“On the buyer side, they’re also leveraging this because it’s a great way to buy software and just put it straight on the AWS bill,” said Chris Grusz, director of business development for AWS Marketplace, Service Catalog and Control Tower. “These procurement people that are not in their homes right now either, they’re just looking for tools to automate and track all the benefits that we provide from a governance perspective.”

AWS Marketplace worked with a large consumer product goods company that needed to continue distributing its food while adopting to consumer changes that saw many people refraining from visiting restaurants, placing more demand on supermarkets. But that behavior shift differed by region.

“People in Florida and Texas were behaving very differently than, let’s say, people in New York and California,” Orban said. “So they couldn’t take this uniform approach to their supply chain. (They) ended up subscribing to a number of different data sets that we have on Data Exchange and therefore on AWS Marketplace to pump in data on different foot traffic patterns and behavior across different zip codes in the U.S. -- what the coronavirus case data looked like, hospital bed utilization and the like to build dashboards that they used to…respond to that shifting behavior. They were able to get, in this case, dozens of different data sets from a bunch of different data providers all in one place, all coming through their AWS environment.”

Partner Success With AWS Marketplace

Presidio, a New York digital systems integrator and AWS Premier Consulting Partner, was a fairly early adopter of AWS Marketplace’s Consulting Partner Private Offers, which allow ISVs to authorize consulting partners to receive wholesale pricing on their software.

“We thought and believed -- and this turned out to be true -- that there were going to be some tremendous benefits for our clients in terms of helping them drive governance and get economies of scale through consolidation,” Presidio CEO Bob Cagnazzi said. “It does retire EDP (enterprise discount program) commitments by purchasing through that motion. Our clients feel that it really accelerates the purchasing cycle and helps them speed up deployments, reduces procurement, operational and billing overhead and just a host of other things. They’re buying hardware, they’re buying software, they’re buying our services, and they can do that through Marketplace.”

The addition of professional services to AWS Marketplace has been incredibly important, according to Cagnazzi.

“It gives us an opportunity to differentiate, but it also gives the client a way to procure the entire solution,” he said. “Typically, when clients are purchasing software from us, they’re also purchasing our services. To have to do that through two separate vehicles can become cumbersome for them, so this makes it much more streamlined for the client and a better experience…and ergo better experience for the AWS relationship that they have.”

Splunk, a San Francisco-based AWS Advanced Technology Partner that offers a “data-to-everything” platform, has security, IT and observability solutions available on the AWS Marketplace, including Splunk Cloud, Splunk Infrastructure Monitoring and Splunk Application Performance Monitoring.

“AWS Marketplace provides a streamlined path to adopt critical solutions like Splunk,” said Bill Hustad, the company’s vice president of alliances and channel ecosystems. “From ease of procurement to contract and billing simplification, there are a number of benefits that our joint customers enjoy through the AWS Marketplace. We’ve seen tremendous growth with the Splunk solutions available.”

PagerDuty, which specializes in digital operations management and is an AWS Advanced Technology Partner, has seen a 350 percent year-over-year increase in business through AWS Marketplace, according to Timm Hoyt, the San Francisco company’s global vice president of partners and alliances.

“This is a testament to our strong partnership and reflects the shift in ways customers are procuring software,” Hoyt said. “Consolidated billing and quicker deployments were growing trends that COVID-19 only accelerated, and as an early adopter of AWS Marketplace, PagerDuty has been well-positioned to support our customers as their IT strategies evolve.”

During an earnings call in March, CrowdStrike said the company’s annual recurring revenue transacted through AWS Marketplace grew 650 percent in the fiscal year that ended Jan. 31, and transaction volume increased more than 300 percent. The Sunnyvale, Calif.-based company is an AWS Advanced Technology Partner that specializes in cloud-delivered endpoint and workload protection.

“We’re probably one of the most transactioned ISVs on the Marketplace, and I think the key is that we’re seeing good pull for our new cloud modules,” CrowdStrike chief financial officer Burt Podbere said during an earnings call in March. “The Marketplace is really a great vehicle for transacting business with both large and small customers. With respect to their governing contracts or their global contracts, I think that this has been a real advantage for us. If both the buyer and seller agree to this standard contract, that just speeds up the process by 80 percent.”

AWS Marketplace Assistance For Partners

In addition to software subscription acceleration, AWS Marketplace sellers get benefits including savings on items such as legal costs, alignment with AWS field sales and AWS catalog promotions.

“They start to see all this additional management capability that they get selling through Marketplace,” Grusz said. “In addition, we do a number of demand-generation activities to promote Marketplace as a whole. As we work with our AWS customers, we invariably will grab solutions in our Marketplace and promote those based off…the use cases…that we’re promoting for AWS as a whole. A good example would be something like data. If AWS is doing a data lake campaign, we’ll then support that campaign and say, ‘Here’s solutions like Matillion on Marketplace that support building a data lake on AWS.’”

AWS also promotes a number of its top ISVs with programs such as webinars and calls to action such as free trials. And the self-service AWS Marketplace Seller GTM Academy gives prescriptive best-practices guidance to sellers on messaging development, campaign assets and performance management modules.

AWS also categorizes solutions by use case – public sector, media and entertainment solutions and financial services, for example.

“On top of on that, we’ll take listings that we know are relevant to a specific type of customer…to the sales leaders across AWS who cover those different kinds of customers to make sure that they know that those Marketplace listings are available,” Orban said. “And then when we start to see traction with some of the newer ISVs or data providers as they come on board, we, of course, celebrate that throughout our field also, which really kind of puts it into context and into perspective for our broader field teams, so that they can bring the similar kind of use cases to their customer who might be looking to achieve the same outcome.”

AWS Marketplace partner offerings also are grouped on AWS web pages highlighting specific services such as Amazon Elastic Container Service or Amazon Elastic Kubernetes Service.

“We’re really trying to provide the products that are complementary to the AWS services alongside each other, and so then they don’t get lost in the shuffle,” Grusz said. “They’re not just mixed in with another 10,000 listings. It’s a much smaller group that’s relevant to those respective services across AWS.”