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When compared to other competing platforms, Znodes ecommerce solutions offer industry leading flexibility and the ability to create a rich user experience that leads to a significantly higher return on investment. This, in turn, reduces overall total cost of ownership and allows our customers to achieve higher profitability. -Travis Williams, Director of Marketing
SK9 - 5.27.11
Table of Contents
Introduction.............................................................................................................................3 Understanding the Total Cost of Ownership Analysis............................................................4 Its all about the Customer Experience...................................................................................5 Focus on Transaction Quality..................................................................................................6 Ecommerce Business 3 Year Example - Analysis....................................................................7 The Bottom-Line...................................................................................................................10 Benefits of Znode..................................................................................................................11 Conclusion............................................................................................................................12
Introduction
Picking the ideal ecommerce platform for your project can be a complex and time consuming task. In this whitepaper, we will illustrate how doing a total cost of ownership (TCO) analysis can help you make the right platform choice for your business.
Understanding why TCO is important for strategic business decisions
It is a common tendency for businesses to look at the cost of implementing an ecommerce solution as the total cost when in reality, it is just a fraction of the cost. At the end of the day, for most businesses, the reason for deploying ecommerce is to increase revenues, brand loyalty and efficiency. Whatever your key business objectives, doing a TCO and ROI analysis will help closely align those objectives to your ecommerce solution.
Why free isnt really free: Evaluating the open source model
Some licensed software are marketed and available as open sourcewhich means all the source code is free of cost. Open source software usually comes with no warranties and often requires significant amount of development work to ensure reliabilitythe added cost of development takes away the advantage of free software and adds additional overhead which must be taken into account. Znode Multifront is sold as licensed software that includes over a million lines of customizable source codecombining the benefits of an open source platform with the reliability of enterpriseclass software.
$450
Znode Multifront
$30,000
$40,000
Annual Maintenance
$18,000
$30,000
Yearly Subscription
$0
Microsoft SQL Server Standard Ed., 1 CPU license Avg. 500hrs development time Avg. 40hrs integration effort Avg. 24hrs UI customization Not necessary - Load test provided out of the box 2 servers at Rackspace Can be managed easily by onsite resource, 4hrs/mo 1 week average per year 1 .NET resource for 16hrs/mo @ $90/hr
$0
Microsoft SQL Server Standard Ed., 1 CPU license, Sharepoint Avg. 820hrs development time Avg. 120hrs integration effort Avg. 80hrs UI customization
$9,000
$15,000
$45,000
$73,800
$3,600
$10,800
$2,160
$8,000
Performance Testing/Validation
$0
$15,000
3 servers at Rackspace (seperate Sharepoint server)
Hosting/Infrastructure Costs
$28,000
$43,200
$9,360
$37,440
$10,800
$21,600
Ongoing Maintenance
$51,840
$144,000
$208,560
$438,840
SAAS
$0
$0
Annual Maintenance
$0
$0
Yearly Subscription
$42,000
$126,000
3% Revenue share
$0
Avg. 820hrs development time, $90/hr blended rate Avg. 120hrs integration effort Avg. 40hrs branding customization
$0
Does not offer much flexibility and hence lower dev. cost Does not allow for advanced integration Significant effort for branding customization Not necessary - built to scale
$73,800
$30,600
$10,800
$3,600
$36,000
Performance Testing/Validation
$15,000
$0
Hosting/Infrastructure Costs
$28,800
2 servers at Rackspace
$0
Includes hosting
$37,440
$37,440
$21,600
$21,600
Ongoing Maintenance
$129,600
$129,600
$362,640
$381,240
The Bottom-line
The following analysis compares the TCO based on investments in each of the four platforms being compared.
Exhibit 3: TCO Comparison among leading ecommerce platforms (3 years)
Summary of findings
Microsoft Commerce Server Open Source Platform Enterprise
TCO Comparisons Online Revenue Total Cost (3 years) Expected Total Cost of Ownership compared to Znode Multifront
Znode Multifront
SAAS
$208,560
$438,840
$362,640
$381,240
+110%
+73%
+83%
As demonstrated on the previous pages, the total cost expected from each platform is derived from extensive analysis conducted through customer feedback, case studies, market research and discussions with several development teams. Keep in mind that this only covers TCO, which is only one component of achieving maximum ROI.
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Benefits of Znode
Overview of business benefits
Rich Customer Experience: Using Znodes Flexible Platform, you can build an ecommerce solution is unique and custom tailored to your brand, allowing an exceptional experience for your target audience. Target customers more effectively and faster with relevant products which increases conversions and ROI. Beat the Competition with a Multi-Store Strategy: With Znode Multifront, there is no limit to the number of stores you can run from a single system. You can create distinct stores for brands, products sets, employee stores, B2B, B2C, affiliates, franchises, co-branded stores and more. Significantly Increase Speed-to-Market: The ability to quickly create micro-stores gives marketers the ability to launch new products and promotional campaigns faster than ever before. Znode makes this possible by sharing attributes and objects across different stores. Once the master catalog is setup, you have complete control. Increase Traffic with 20 SEO Best Practices: Multifronts platform was built from the ground up to ensure that all aspects of the code and generated stores are SEO friendly and has been tested and certified by a leading SEO agency. Increase Operational Efficiency with Seamless Integration: Quickly integrate your storefront with back-office systems, suppliers, and 3rd party services. This effectively eliminates manual processes improving operational efficiency. Reach Millions of New Customers: Push products to places your customers frequent including Facebook, Mobile Phones, Store Kiosks and more. Reduce Total Cost of Ownership: Reduce the total cost of ownership compared to other competing platforms by accelerating store deployment and significantly reducing the cost of ongoing maintenance. Go with a Trusted Brand: Leading global brands such as Waste Management, Berkshire Hathaway, Wawa, Kimberly Clark, and LoJack, trust Znode to power their mission-critical ecommerce.
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Conclusion
As demonstrated in this whitepaper, it is important to carefully consider your overall business objectives before picking an ecommerce platform. Using Znode Multifront, you can significantly lower your TCO compared to other platforms and build an ecommerce solution that delivers a rich customer experience, high transaction quality and higher overall ROI. Leading brands worldwide have placed their trust in Znode to run mission-critical ecommerce applications. We look forward to working with you on your next ecommerce project and becoming the platform of choice to run your online enterprise. If you would like to learn more about achieving lower TCO and maximizing your ecommerce ROI, please contact us today!
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Resources
Product Overview: Live Demo: Customer Portfolio: www.znode.com/znode-multifront www.znode.com/demo www.znode.com/portfolio
Notices 1. Znode does not guarantee the results presented in this TCO analysis. Results may vary depending on your individual business needs. We advise you to use this document as a guideline and perform your own TCO and ROI analysis. 2. Microsoft is the registered trademark of Microsoft Corporation
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