With budgets for cloud services expanding and the complexity of infrastructure rising, marketplaces are positioned as the future of B2B commerce. Industry analysts are taking note—most recently IDC published its first-ever IDC MarketScape: Worldwide Cloud and Applications-Centric Marketplaces 2023 Vendor Assessment (doc # US51037123, December 2023). The Microsoft commercial marketplace was named a Leader in the report.
As the IDC MarketScape notes, buyers and sellers want digital ways of interacting that have the same ease and sense of community as traditional marketplaces. With digital technologies becoming more advanced, there’s a natural benefit to scale in support of innovation while simultaneously offering the proper controls to manage the business. Microsoft customers that align their organization’s Azure cloud strategy to the marketplace are seeing tremendous benefits. By purchasing third-party solutions through Microsoft Azure, customers can maximize investments while balancing costs with fast, click-to-deploy, solutions that are validated for compatibility with Microsoft applications for virtually any cloud scenario.
“Consider the Microsoft commercial marketplace for all your Azure cloud-based Microsoft products and services to be able to seamlessly draw on your committed cloud spend and easily install vetted and compatible solutions.”
—IDC MarketScape: Worldwide Cloud and Applications-Centric Marketplaces 2023 Vendor Assessment, December 2023.
Pre-committed cloud budgets driving customer adoption
The IDC MarketScape recognizes that with cloud budgets increasing, organizations are looking to get more from their investments. Most large cloud providers offer consumption commitments—contracts providing discounts on cloud infrastructure once a customer meets a certain spending threshold. According to the IDC MarketScape, “One of the most popular benefits of the marketplace is that 100% of eligible purchases count toward buyers’ Microsoft Azure Consumption Commitment (MACC), which greatly streamlines procurement and spend management for organizations.”
Customers can quickly filter in the marketplace to browse thousands of eligible solutions that count towards their commitment, making it easy to unlock discounts on Azure infrastructure. Already more than 85% of customers with commitments are buying partner solutions via the marketplace to maximize their investments.
Balancing customizations versus “one-size-fits-all”
The IDC MarketScape report also recognizes the complexities of enterprise procurement. Despite the digital-first nature of cloud marketplaces, customers making large investments need flexibility to negotiate while having the opportunity to maintain partner relationships. Cloud marketplaces are sometimes perceived as a storefront limited to ‘off-the-shelf’ options, but they can provide highly customized solutions that vastly simplify the procurement process.
“Marketplaces have evolved from basic catalogs and commerce-enabled websites to feature-rich platforms for procurement transformation.”
—IDC MarketScape: Worldwide Cloud and Applications-Centric Marketplaces 2023 Vendor Assessment, December 2023.
To ensure cloud portfolios remain consolidated while simultaneously addressing the unique needs of both customers and partners, the marketplace now has enhanced private offer functionality. Through private offers, customers can:
- Negotiate pricing
- Customize terms and conditions
- Trial proof-of-concepts
The IDC MarketScape notes that “Marketplaces accelerate growth in ecosystem partnerships through network effects that lead to co-innovation and new value creation.” With a network of over 400K trusted partners, the Microsoft commercial marketplace supports them in selling together through multiparty private offers. Multiparty private offers empower channel partners to procure solutions on the customer’s behalf—giving customers the benefit of maintaining their channel relationships while enjoying the advantages of buying through the marketplace. According to the IDC MarketScape, “Recent enhancements to private offers added a multiparty capability, which allows marketplace sellers to bring a third party, such as a reseller or a services partner, into the transaction, expanding the reach of the marketplace and making it possible to collaborate on more complex, higher-value deals.”
“The robust private offers and private marketplaces features, as well as the broad spectrum of products and services accessible through marketplace, make it a preferred channel for many enterprises. The new multiparty option for ISVs and their selling partners also adds more flexibility and strengthens the Microsoft ecosystem to the benefit of buyers.”
—IDC MarketScape: Worldwide Cloud and Applications-Centric Marketplaces 2023 Vendor Assessment, December 2023.
Microsoft Azure
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Leading the future of B2B commerce
As the most-trusted cloud provider, Microsoft continues to invest in its marketplace as the primary channel to connect customers to our robust partner ecosystem to solve virtually any business or technology challenge.
The IDC MarketScape notes that continuous innovation is the hallmark of today’s cloud marketplaces. The Microsoft commercial marketplace roadmap is purpose-built to simplify cloud management. For example, Microsoft is building a new AI-discovery tool to help customers identify the solutions they need instantly. The ChatGPT inspired experience intelligently surfaces solutions while reinforcing suggestions by referencing trusted content. According to the IDC MarketScape, “A generative AI-based solution finder, currently in preview, is likely to make the good user experience on the marketplace even better.” This tool is currently in preview for select customers.
The Microsoft commercial marketplace offers customers a balance between agility and control. With cloud budgets growing and demands for innovation accelerating, cloud marketplaces will continue to make their way to center stage in B2B commerce.