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Electronic Software Delivery (ESD) has been on a journey of escalating heights since we first started offering our solution in 2012. ESD adoption is more than a steadily growing trend, and it is now the preferred method of software distribution for on-premises software like Microsoft Office 365, Adobe Creative Suite and more. Meanwhile, not every software vendor supports an ESD model yet.

Early and late adopters alike can attest to the operational efficiency and increased profitability brought to their businesses from offering their products as easy software downloads – and so can their customers. While the benefits are undoubtedly attractive, laggards may question if ESD is the right choice for them. So, why should they look to ESD to reduce operational costs, add value for their customers and ultimately become more profitable?

What is ESD?

ESD is the abbreviation used in software to refer to Electronic Software Delivery. It is a method of software distribution which involves direct transfer of software data using the internet. It was introduced as an alternative to software distribution via physical media, such as discs, flash drives and paper-based user manuals. Comparatively, ESD allows for a more secure and measurable method of software deployment, in addition to ongoing updates.

How does ESD reduce operating costs?

ESD replaces outdated physical media with a simpler, more efficient way to transfer data. This model supports potential cost savings, but it also eliminates dependence on slow, unreliable and uneconomical methods of delivering software.

By offering software data as downloads via the internet, businesses can avoid the costly sums associated with creation, storage and shipping it as a physical product. For example, by switching to an ESD distribution model, our customers could offset an average cost of $20 per DVD.

With support from an ESD strategy in this example, software developers could save around $9.5 million in just one year. Forget the days when installation files were stored on physical discs and accompanied by bulky manuals! But the benefits stretch much further into compliance responsibilities and wider operational structures, too.

Many ESD services incorporate automated export compliance checks. These ensure customer compliance is achieved in relation to export laws, including end-user licensing agreements (EULA). By supporting a product delivery process with integrated compliance measures, like ESD, due diligence around data transfers becomes a less intimidating aspect of software distribution.

Perhaps more importantly, by offering immediate access to the latest versions of software products that customers are entitled to use, customer management can be executed at a fraction of the cost. Support teams can vastly reduce the number of calls and issues their agents need to service if customers are able to service themselves. End-user customers can update their systems with the data patches they need, long before their problem turns into a grievance that needs to be addressed by an employee.

How does ESD add value for customers?

ESD supports self-service which can be a major differentiator when comparing software options. Firstly, instantly installing a software package via the web gives customers more acute control over maintenance plan management. Secondly, it eliminates many of the logistical hassles of considering renewal.

ESD software distribution can be executed via secure software downloads. This means the newest and best versions are instantly available to customers, as soon as they have been released. Plus, online transfer files have a far lower risk of data corruption. Overall, an ESD software download is much more secure than using physical media to transfer data.

Having the option of direct access to the latest software updates means that users are less likely to experience glitches or faults. So, from initial purchase to ongoing maintenance, software vendors can support their customers with optimized software solutions. Customers are even encouraged to complete updates themselves to limit interface time with customer service agents. This way, vendors can effectively remove friction from the customer journey, leading to greater satisfaction rates. Furthermore, since all exchanges are executed digitally, customers can benefit from a complete audit trail of the data transfer if issues do arise.

Staying on top of software updates can be demanding, especially when developers are working quickly to respond to data errors, performance flaws and new security risks. Customers can hand this burden over to their software provider, who will let them know when it’s time to update.

This way, software developers are able to focus on consistently improving their product and customers can enjoy a fully functional service with optimized systems performance.

How does ESD increase profitability?

The most obvious benefit of ESD to profitability is scale. In short, vendors can simply sell more at very little cost. Its cloud-hosted software distribution processes allow them to deliver services to more businesses and consumers without the usual logistical constraints. Self-service also presents vendors with the opportunity to easily upsell at scale.

Upselling is where ESD maintenance contracts become instrumental. If customers want to take advantage of the latest software patches which keep their systems running effortlessly, they must ensure that they have agreed to the terms of an active maintenance contract. This entitles them to continuous upgrades as part of a subscription. So, when jarring flaws have been fixed or new features have been released they can benefit straight away.

If customers choose not to repurchase continuously, the product that they use will become outdated relatively quickly. This is largely due to the fast work of good developers who are constantly learning from errors to improve software. Failure of vendors to ensure that maintenance contracts are available as part of their software distribution method will lose revenues. Meanwhile, non-paying customers continue “free riding” on existing systems.

Entitlement-driven software distribution solutions, like Revenera’s, eliminate the risk of “free riding” and protect the longevity of a product’s profitability. These product models only show product updates and patches to customers if the data confirms that the user is contractually entitled to the product.

In general, this type of conditional product delivery has an overwhelmingly positive influence on renewal rates. It also contributes greatly to incremental revenue growth for vendors.

To nurture strong ongoing customer relationships, ESD model vendors can easily and accurately track customers’ usage using a complete audit trail. This gives them access to data which reveals the version of the software that each customer is currently using. From this, they know whether the customer is eligible for an update. If so, they can notify appropriate customers as soon as new versions are available, adding a layer of convenience.

Of course, if the user is recorded as active on maintenance services, all of the benefits are unlocked for them. As such, vendors can keep customers continuously engaged with frequent and convenient communications about the product and any available updates.

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Extra support helps to demonstrate a commitment to quality of service. To do so, vendors should continue to deliver fully optimized software, all the time. In the long run, this approach to software distribution allows vendors to build the support of a loyal customer base. Conversely, customers will continue to invest in a service that they feel they can rely on.

Why is ESD adoption a good choice for all software vendors?

ESD is a software distribution option with longevity. Vendors which plan on maximizing their growth potential should avoid choosing to spend unnecessary time and money on physical media for sharing data. Instead, an ESD software distribution solution will support growth and build trust for years to come.

In an increasingly digital, data-driven world, businesses and individuals rely on the software they use every day. They cannot wait for their systems updates to be delivered and installed using traditional, physical methods. Not to mention, file sharing has moved on. Many programmes are now even hosted completely in the cloud, so data hardware has no place in the process.

Soon, the conversation will shift from, “what are the benefits of adopting ESD?” to “what are the risks of failing to adopt ESD?” – of which there are many.