Re: Dropbox Question 1 － Extended services vs Easy to use

LeeAnn Tue Nov 22, 2011 2:00 am

Last round, ding ding.

So still most of you think that they should stick to their free and simple offering. In the same time, you think it is a good idea to attract more business customers.

-What would be possible offerings for SMEs (apart from what is already in the Team package) that could attract those?
-What would YOU pay for?

zhieeep Tue Nov 22, 2011 1:25 am

I think that in its growth phase, Dropbox should work on simplicity and ease of use, which are the hallmark advantages of this new service. The catchphrase "It Just Works" may lose its efficacy and promise if Dropbox decides to overextend its offerings. Because the company has shifted away from Google Adwords advertising, it must now rely primarily on word of mouth exchanges between friends, family and coworkers to grow organically. When the amount of employees in a company have reached critical mass, the IT department is bound to take notice and go for the premium model, which is quite a good bargin compared to the usual IT budget allocation.

This being said, I believe that the premium model can be more tailor-fit to customer's individual needs especially for the enterprise model, because it is assumed that the IT department can understand the technical jargon needed for a custom model. All these technicalities should be hidden from the initial splash page to welcome the 1st time novice user and only visible to those that can understand it.

Dropbox should not tinker with the formula unless there is an overwhelming cry from customers to overhaul the current system. The beauty of dropbox lies in simplicity.

MeiShinLee Mon Nov 21, 2011 5:03 pm

If I were the manager of SMEs, I think I will to pay $795 a year for 5 users ( and $125 for each additional user) to dropbox. Because I think this is a reasonable price for SMEs to take the file share and syncing service.

However, I think Dropbox could get more revenue by offering some customized service to the paying customers, or find some business customers. Like "Dropbox for Teams" is a good way to increase their revenue. In this way, Dropbox still can stay in their core business- file share and syncing and also get more revenues.

I don't think it's a good way to start charging for the service which has been until now. Because this will make Dropbox lose its competitive advantage. Dropbox still need the "free" service to attract people to their business. The more user they have, the bigger opportunity to get the customer who will to pay.

I think Dropbox could be interesting for large companies, but not for now. Because they don't have enough experience to address the problem and needs of large companies. I think it will work in the future, but now it would be better to focus on their SMEs customer and to attract more paying customers.

pierrelin Mon Nov 21, 2011 3:02 pm

Yea Rio, there seems to be a limit from Dropbox in terms of data transfers...so you can only enjoy this for free if you are a small business with a small website. This is where the incentive to pay for more storage come into play =)

"Note that with both services, you're subject to Dropbox limits on data transfers. For free users, it's 10GB per day and for Pro, 250GB. Users whose Dropbox public links go over these limits will be automatically suspended. So these webapps may be really cool for hosting a small site (perhaps something you just share with friends or co-workers), but not for a major website."

rio ohmori Mon Nov 21, 2011 2:58 pm

Pierre,
Droppages looks interesting. I like it, but still seems to target for individuals or small companies. I guess those kind of additional functions can be tips to differentiate from others which dropbox can expect additional revenues.

I found out paid service does have keeping unmodified files for 30 days service. (should have go through all FAQ before i wrote my previous one...) In terms of dropbox for teams and its pricing, I guess it's worth trying. Since they have forum which is working well to communicate with users, they can give a shot and find out afterward. But I just wonder why they put annual fee but not monthly fee like others. $9.99 a month, $19.99 a month, and all of sudden $795 a year. Psychologically, it sounds a bit expensive.

pierrelin Mon Nov 21, 2011 2:13 pm

I'm also a big fan of dropbox and think that most of the attraction comes from the fact that it is free and easy to use. So keeping it simple is definately something Dropbox should keep doing for its individual non-paying customers. When we're talking about small businesses and enterprise use of Dropbox, aside from monetizing and charging teams for higher capacity storage, they could also go into file web page hosting services. I came across a little article on Techcrunch that talks about 2 webapps that leverages Dropbox's online file storage to basically host web pages for small enterprises. here's the link to the article:

http://lifehacker.com/5860139/host-web-pages-for-free-within-dropbox-with-droppages-or-pancakeio?utm_medium=referral&utm_source=pulsenews

DropPages

While these two are free to use for anyone, one way Dropbox can incentivize paying customers, is to look into these types of webapps and integrate them into their product offering as extended services.

LeeAnn Mon Nov 21, 2011 2:04 pm

Hey everybody,

sorry for having been a lousy moderator. Just came home from 12 hours of class Suspect

Nevertheless, the discussion seems to have found its own flow and you have come up with a voting haha.
Let me just summarise the main points so far:

Main points:
-Dropbox is suitable for private people as well as SMEs but not large enterprises
-Most of your votes go to "simple & easy to use"
-That being said, the Dropbox Team doesn't necessarily mean a complication of the "simple & easy to use" approach, does it?

Open questions:
-Are people (SMEs) willing to pay $795 a year for only 5 users?
-Is the Team option really the way forward? (CEO Houston prefers to do “a few things well rather than present Dropbox in a confusing way”)
-How can Dropbox yield more revenue?
-Could they start charging for what has been free until now? (I strongly doubt that...)
-Is there no way that Dropbox could be interesting for large companies?

I look forward to hearing your thoughts!

berji Mon Nov 21, 2011 11:56 am

MaxC wrote:As Lee Ann just mentioned, Dropbox is currently offering a special product for enterprises: Dropbox for Teams. The basic offer is that for $795/year, a team of 5 persons receives 1TB of storage and phone support. Moreover, all file revisions are saved indefinitely by default ("unlimited version history"). It seems to respond quite well to customers' needs, at least if we refer to the posts on this forum. In my opinion, the idea is good in the sense that Dropbox stays quite close to its "core business" (file share and syncing) and can leverage its experience by extending its target customer segments.
However, this move also raises several issues. The success of Dropbox seems to be largely due to its "free" offering. Are businesses ready to pay $795 (or more) per year for Dropbox' solution? How can Dropbox compete on this new customer segment? I suppose its "brand name" and existing customer base are key assets for Dropbox, but I'm not sure that it will be sufficient...
All in all, I believe that Dropbox' move is quite interesting as it represents potentially a new source of cash, answers customers' needs, and relies on company's "knowledge capital". Moreover, if Dropbox for Teams is successful, it could be an opportunity for Dropbox to extend again its customer segments to big companies, by for example offering packages for thousands of employees (instead of just 5).

Edit: sorry for repeating what has been said, other answers explaining "Dropbox for teams" were given by the time I was writing

I totaly agree with this intervetniton, the main advantage of dropbox nowadays is that is free.
what i can add is that nowadays entreprises can pay for safer solutions and personalized for their companies, SO maybe dropbox can go this way and try to give more personalized and safest solution for entreprises...

Mu Jou Mon Nov 21, 2011 11:45 am

Vote to "easy to use", too.
I'm using iCloud, Gdocs, & dropbox now. For me, the most beautiful using experience is Dropbox. Why?

Most of time, i would still edit and modify files in local in stead of online. So Gdocs is a little bit inconvenient for me.
In the other hand, iCloud need for lots of settings and few limitation of documents. It still doesn't fit my requirement.

"Drag & drop" & "Sync for all devices with local copies" are the tremendous success factor for Dropbox...but only for laptops & desktops now.
They have to keep it and make it "ease to use" for mobile devices and "Pad" family too.

Xiaowei Wen Mon Nov 21, 2011 11:00 am

As “Dropbox for Teams” is on the way, Dropbox is trying a more complicated version, which is a different idea from their 2010’s target to individual users. Houston once said that “once IT sees that Dropbox is in heavy demand and that it works reliably, we’ll get certified for use across the company”, so has Dropbox already been in heavy demand now? Even so, is the new demand strong enough to make the Dropbox change their core value? I’m not sure. Take Yammer, the enterprise version Twitter, for eg, it has more complicated function than Twitter, which targets both SMBs and big enterprises, but still has not been widely accepted. Maybe Dropbox could try from some SMBs, but in my mind they should still focus on its core value that “it’s just works”.
As to increase the revenue that some people mentioned, I don’t think it should depend on the enterprise version, maybe they could gain more from the Mouth-2-mouth method which has already make them successful.

rio ohmori Mon Nov 21, 2011 10:28 am

I also vote for keeping "easy to use" Mostly same reasons as many of classmates already mentioned. On top of it, to me, compare to things like Google doc, drag and drop is much more convenient. And I can also share any kind of files as long as they are not too large.

Just like dropbox for teams, if multiple people can access, keep track of modification history, and some sort of access restriction will be very helpful. A company I worked before, we had numbers of designers and physical server in the office to share all files. When one employee, whether it's by mistake or on purpose, overwrites on a completed file, we had to redo the work again. Also, considering a nature of dropbox, whoever can access files can remove files. This might be little too risky to share something important.

Laurent Corigliano Mon Nov 21, 2011 10:01 am

Indeed, only 2 to 3 % of Dropbox users are paying customers!

Laurent Corigliano wrote:Hey everyone,

To my mind, an "easy to use" product is great when it comes to B2C. Indeed, dropbox is so successful with everyone because it is simple to use and even a non-nerdy guy can make the most of it. Yet, I'm not sure the B2C approach is likely to be the most profitable one since like skype I'm pretty sure the majority of people is only using the free 2GB storage.

When it comes to B2B, I think cloud computing storage and sharing represents a huge opportunity, so that is sure for me that dropbox should enter this market. Yet, the way they should present the service and market it (even price it) should be different. First, they'll be working with the IT department of a company, so with more experts people so they can try to deliver a more sophisticated product. it does not mean it has to be more complicated, but it had to be more evolved as the needs of a company are not the same as the ones of a person: they'll need more storage, more privacy since all teams don't work on the same project, more security to satisfy the confidentiality terms of the company.
Then, it should be automatically integrated in the computers since you are not the administrator of your professional computers, so it requires a different approach to market your product since you cannot just propose it on the web and wait for people to use it. Finally, they could also think about licensing their products, so that they could be capable of reaching a large audience without having to meet every client.

charles.gras Mon Nov 21, 2011 9:54 am

To me Dropbox value proposition is to replace our USD drives with a better product, this goal is already attained and it would be hard for them to charge the customer for this so far free service. It can try to make some money with advertising or partnerships when it comes to distributing the Saas (directly incorporating the apps in hardware like mobile phones) but the service remains the same. it can add some talk platform to enhance the collaboration on one document which would be hard to charge.

Small Businesses market on the contrary gives room for service extension and access to customers willing to pay. Features like intranet and extranet, webmail, knowledge sharing tools and storage optimization could be developed and charged along with the data storage itself. I am sure Small business could value this integrated approach of Data Management.

Ch

Laurent Corigliano Mon Nov 21, 2011 9:51 am

Hey everyone,

To my mind, an "easy to use" product is great when it comes to B2C. Indeed, dropbox is so successful with everyone because it is simple to use and even a non-nerdy guy can make the most of it. Yet, I'm not sure the B2C approach is likely to be the most profitable one since like skype I'm pretty sure the majority of people is only using the free 2GB storage.

When it comes to B2B, I think cloud computing storage and sharing represents a huge opportunity, so that is sure for me that dropbox should enter this market. Yet, the way they should present the service and market it (even price it) should be different. First, they'll be working with the IT department of a company, so with more experts people so they can try to deliver a more sophisticated product. it does not mean it has to be more complicated, but it had to be more evolved as the needs of a company are not the same as the ones of a person: they'll need more storage, more privacy since all teams don't work on the same project, more security to satisfy the confidentiality terms of the company.
Then, it should be automatically integrated in the computers since you are not the administrator of your professional computers, so it requires a different approach to market your product since you cannot just propose it on the web and wait for people to use it. Finally, they could also think about licensing their products, so that they could be capable of reaching a large audience without having to meet every client.

albertcotraviwat Mon Nov 21, 2011 9:46 am

I don’t want to beat the dead horse here but yes I agree with everyone adding Dropbox for teams” is a great way to leverage its current strong brand name and knowledge capital to extend its reach to B2B customers. However having said that, ultimately Dropbox should focus on its core value: keeping it simple and easy to use but more importantly, just making sure IT DOES WORK.

When Dropbox first entered the mature and competitive online storage services market in September of 2008, they made sure to do one thing, differentiate themselves by offering a simple product THAT WORKS. No more frustration over corporate firewalls and big complicated attachments. Make it work and they will come. While new competitors will surely arise and technology increasingly becoming more advanced and efficient, Dropbox must stick to its own guns and focus more of its budget on engineering and data security, and less on product development. As CEO Drew Houston mentioned, they would prefer to do “a few things well rather than present Dropbox in a confusing way”.

r99725051 Mon Nov 21, 2011 9:28 am

It's a good idea that Dropbox think more about business customers, but I think stable and safety is more important than sophisticated services.
The core competence for Dropbox is storage spaces, so if it want to develop more diversity of services, it's still need to fit this core competence, and I think maintain its system stable and safe is very important.

Josephine Mon Nov 21, 2011 9:20 am

LeeAnn wrote:Thanks Kai for your thoughts. So you think that the same service is suitable for SMEs and doesn't need changes (do I get you right?). Is it also suitable for larger players or are they not Dropbox customers?

Also, a new feature was launched a month ago called "Dropbox for Teams". Hint hint everybody

I think Dropbox is not suitable for the large enterprise since the large enterprise should have their own storage server.
The main user (customer) of Dropbox is individual and small company, they use Dropbox as a simple collaborative and file sharing tool. Furthermore, every large enterprise have it's own standard for file sharing so I think it is very difficult for Dropbox to do the customized services to satisfy their use and business need.
But for the individual, like me, I use Dropbox for my personal file storage since I can access the file everywhere without bringing a USB or sending a email to myself.

Josephine Mon Nov 21, 2011 9:12 am

I think “simple, easy to use” is a general idea of Dropbox.
Many people and small company tend to use Dropbox because it is ease of use and convenient to use.

As Dropbox is a cloud storage services, the critical issue is to provide ubiquitous access and security storage, not to provide a sophisticated application. But adding more simple and value added applications may attract more people to use Dropbox for collaborative use.
In my point of view, Dropbox may extend its services by providing some collaborative tools (for example can let use modify the document simultaneously and view the modification immediately).

chaohungchen Mon Nov 21, 2011 8:48 am

LeeAnn wrote:Thanks Kai for your thoughts. So you think that the same service is suitable for SMEs and doesn't need changes (do I get you right?). Is it also suitable for larger players or are they not Dropbox customers?

Also, a new feature was launched a month ago called "Dropbox for Teams". Hint hint everybody

In my opinion,
those big enterprises are not Dropbox's customers.
To satisfy those big enterprises' needs, the functions of IT systems have to be much more complicated, not only about cloud storages.
Those big enterprises are not afraid of investing a lot of money on their IT systems, but what they need is a customized, reliable and integrated IT systems.
But Dropbox doesn't have enought B2B experiences and experienced IT consultants in B2B.

And I think the information security is another big issue.
Those larger enterprises will not want to save their secrets in the Dropbox.

CQUILAN Mon Nov 21, 2011 8:23 am

“If you think of your free user costs as your marketing budget, then things begin to make more sense”.

Like Dennis said, I deem the 2 gb as sufficient for individuals. Yet, they are not useless ! They spread the word about Dropbox around them - including at their workplace.

Therefore, a good segment to target could be the small and medium size enterprises: they usually do not have staff dedicated only to IT so they need something easy to use but their expectations may be higher than those of individuals and more importantly, they may be willing to pay for it - a company run a few people may be one target, especially if they do not have an office!

However, I doubt big enterprise would be interested. As said in another thread, I presume they would rather go for comprehensive solutions.

Therefore, more sophisticated application relevant for small to medium size enterprise would be a great idea in my opinion.

MaxC Mon Nov 21, 2011 8:08 am

As Lee Ann just mentioned, Dropbox is currently offering a special product for enterprises: Dropbox for Teams. The basic offer is that for $795/year, a team of 5 persons receives 1TB of storage and phone support. Moreover, all file revisions are saved indefinitely by default ("unlimited version history"). It seems to respond quite well to customers' needs, at least if we refer to the posts on this forum. In my opinion, the idea is good in the sense that Dropbox stays quite close to its "core business" (file share and syncing) and can leverage its experience by extending its target customer segments.
However, this move also raises several issues. The success of Dropbox seems to be largely due to its "free" offering. Are businesses ready to pay $795 (or more) per year for Dropbox' solution? How can Dropbox compete on this new customer segment? I suppose its "brand name" and existing customer base are key assets for Dropbox, but I'm not sure that it will be sufficient...
All in all, I believe that Dropbox' move is quite interesting as it represents potentially a new source of cash, answers customers' needs, and relies on company's "knowledge capital". Moreover, if Dropbox for Teams is successful, it could be an opportunity for Dropbox to extend again its customer segments to big companies, by for example offering packages for thousands of employees (instead of just 5).

Edit: sorry for repeating what has been said, other answers explaining "Dropbox for teams" were given by the time I was writing

DennisProesch Mon Nov 21, 2011 8:06 am

I think dropbox simplicity is its current key advantage but as we can see their current approach does not yield as much revenue as it could. Their current approach of offering different services for various customer segments is the right way I think since it enables them to approach different markets more efficiently. The current main issue in my opinion that the company is facing is that most casual customers do not think of dropbox as a potential service that they would pay for as the starting 2 gb are sufficient for most of their uses. Maybe an approach of charging these currently not paying customers would be applicable. For example external advertising could be used to generate revenue as e.g. some filesharing online platforms did in the past.

EsbenSvaneKrarup Mon Nov 21, 2011 8:04 am

Keeping it simple is certainly the way forward, I think business like Dropbox because it offers them a simple way to share and synchronise files. As mentioned, Dropbox recently introduced "Dropbox for teams" which essentially add some extra features such as admin control, support, easy billing, extra security, etc. I think this is a smart approach as it adds usability for companies while maintaining the simple core offering.

Glen Yang Mon Nov 21, 2011 7:44 am

LeeAnn wrote:Thanks Kai for your thoughts. So you think that the same service is suitable for SMEs and doesn't need changes (do I get you right?). Is it also suitable for larger players or are they not Dropbox customers?

Also, a new feature was launched a month ago called "Dropbox for Teams". Hint hint everybody

yeah, that's also what I've found, Very Happy

and the price -- $795 annually for five users -- if I could say that is equal to $13.25/month for a user,
between the price of 50G ($9.99/month) and 100G($19.99/month),
so I think the price is quite reasonable, if I need those additional services and space, I will try the team package.

Glen Yang Mon Nov 21, 2011 7:33 am

LeeAnn wrote:So far Dropbox offers a “simple, easy to use” service. Since there are more and more business customers, should Dropbox go beyond file sharing and syncing, thus offering a more sophisticated application for enterprises?

I think the more possibilities to build new revenue stream the better,
and they actually did launch "Dropbox for Teams" this November for business users, there are four features of it:
Work on the Go, Collaborate and Share, Easy Setup and Control, Trusted and Dependable.

"Sophisticated" doesn't mean "complex", I think Dropbox will and should hold the spirit of "simple, easy to use",
or they will losing their customers.

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Dropbox Question 1 － Extended services vs Easy to use