Amazon Web Services has added new features to AWS Marketplace that will resonate with enterprise procurement teams, grow the cloud provider's reach and bring Amazon's commerce knowhow to partner websites.
At re:Invent, AWS fleshed out its AWS Marketplace strategy with three launches:
- Support for granular purchase orders across all product and pricing types. This move enables spend tracking, expedited payment processing times, post purchase PO updates and pay-as-you-go pricing as well as flexible payment schedules.
- Multi-currency private offers and non-USD bank account support. This addition to AWS Marketplace eliminates currency fluctuations and risk for buyers and adds support for EUR, GBP, AUD and KRW at launch.
- Buy with AWS, which gives partner websites the ability to transact wit
h AWS Marketplace listings. Think of Buy with AWS as AWS Marketplace to go. Buy with AWS is an effort to take AWS Marketplace everywhere and enable purchase on independent software vendor sites, power distributor cloud marketplaces and give channel partners the ability to host curated storefronts and resell AWS Marketplace listings.
AWS Marketplace momentum
AWS Marketplace has quietly built momentum in recent years and it's clear that the effort has gained in importance. For enterprise buyers, a more frictionless purchasing experience is critical because CxOs already limited time is gobbled up by contracts, legal teams and haggling. One of the big benefits of AWS Marketplace is that it standardizes contracts to a large degree and compresses contacting cycle time by as much as 50%.
At re:Invent 2023, AWS reduced listing fees for AWS Marketplace. Today, AWS Marketplace features more than 5,000 sellers from 39 different countries selling products across 70 categories. There are 2.5 million active subscriptions from AWS Marketplace.
A few more recent items:
- Salesforce, Databricks and CrowdStrike were among the large enterprise software players noting that they were closing big deals on AWS Marketplace.
- Marketplaces are part of an overall shift in enterprise software purchasing as vendors are shifting to new models and enterprises are looking to consolidate and simplify.
- Enterprises need to accelerate cloud and artificial intelligence adoption and see marketplaces as a way to integrate vendors and foster collaboration.
Speaking at Constellation Research's Connected Enterprise, Phil Potloff, GM of AWS Software Marketplace, said the company is focusing on the buyer experience. "Customers have moved more of their IT infrastructure to the cloud and that's where they're running third-party software," said Potlaff. "We look at upfront discovery. Buyers want to evaluate software without a sales pitch. We focus on time to value. We look at IT buyer and procurement friction. We're a way to control spend with standardized contracts."
Navigating a sprawling vendor landscape
While AWS Marketplace features software from IBM, Salesforce, ServiceNow, CrowdStrike and others, it has become a channel for startups. AWS cited Orca Security as a startup that has leveraged AWS Marketplace to drive 800% revenue growth. Another startup, Drata, derives 40% of its revenue from AWS Marketplace deals.
Chirag Mehta, Constellation Research analyst, said enterprise buyers have three types of marketplaces. The most high profile marketplaces are from hyperscale cloud providers. Business application marketplaces are also prominent. Data and AI marketplaces are also emerging for enterprises.
Each of those categories have established vendors and new entrants for enterprises to consider. "It's incredibly difficult to discover, try and buy so customers are looking to reduce friction, enable employees to use tools and have governance," said Mehta.
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The plan for AWS Marketplace is to expand choices on its own platform and extend it into channel partners via Buy with AWS. Via Buy with AWS, customers can request demos, get custom pricing and procurement while using AWS accounts. That avenue can expand partners' ability to sell custom applications.
IBM has expanded the availability of its software portfolio on AWS Marketplace to 92 countries with its AI and data technologies serving as the headliners. IBM is offering its software directly on AWS Marketplace as well as via partners. More than half the deals closed on AWS Marketplace in 2024 were new clients for IBM.
