Despite moving to the cloud for cost savings, most companies are willing to pay extra for certain improvements to their service, a 451 Research report found.
Even though many businesses move to the cloud for perceived cost savings, 75% of organizations are willing to pay extra for guaranteed security and improved performance, according to a 451 Research report.
Of those who were willing to pay a premium for improved hosting and cloud services 48.7% said they were willing to pay extra for security guarantees. Service performance was the next most desired improvement, with 43.3% saying they would pay extra for it. Surprisingly, only 27.9% said they would pay for service providers to take on more of the operational management burden, the report said.
While benefits like cost savings, flexibility, and performance boosts are often perceived as part of the cloud, that isn’t the reality for all hosted infrastructure and applications, the report said. But, sometimes these benefits outweigh even the cost of the cloud product itself.
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“We frequently talk about pricing competition in cloud infrastructure and applications, which leaves many service providers wondering how they can differentiate themselves,” Liam Eagle, research manager at 451 Research, said in a press release. “The good news is that many customers tell us they’re evaluating vendors on value, rather than cost. That value can reside in services like guaranteed levels of performance, security and support.”
However, taking advantage of these benefits isn’t always easy. Properly utilizing these cloud tools requires users who have the platform expertise to do so. And, often, companies begin to find gaps in their skills set when they deploy such a cloud service. According to the report, 41% of businesses said they had gaps relative to their cloud service deployments.
Businesses are moving past entry-level cloud deployments and into more complex implementations, the report said. This, combined with the skills gap that exists in many deployments creates a new opportunity for cloud services providers to add value.
“We have found that customers still see shortcomings when it comes to service providers helping them strategize and execute around hosting and cloud,” Eagle said in the release. “Service providers focused on adding value should regard these gaps as opportunities they can capture by improving the quality of their own service in specific areas.”
The 3 big takeaways for TechRepublic readers
- According to a 451 Research report, 75% of organizations are willing to pay extra for a premium experience from their cloud services and hosting provider.
- Of those organizations, 48.7% said they were willing to pay extra for security guarantees from their vendor.
- These desires for improved security and performance, along with the skills gap present in many cloud deployments, are creating a new opportunity for cloud vendors to more deeply integrate with their customers.