NetSuite's Zach Nelson on competition, cost, the Next Big Thing

Last week I met with Zach Nelson, CEO NetSuite in circumstances very similar to those when I recently met with SAP. There are obvious comparisons:

• SAP provided a hands on individual demonstration of Business ByDesign, NetSuite limited its demo to some pre-canned scenarios demonstrated by Mini Peiris, VP product marketing.
• Both companies were running the app on a crabby network, SAP slightly edged it on non-business analytics application performance.
• SAP customers took questions from the floor, Zach Nelson served as the Q&A ringmaster but asked the kinds of question I would expect put to any customer.
• NetSuite was clearly trying to sell the concept of cloud computing including a cloud economics lesson from analyst Robin Bloor, SAP assumes that ByDesign is just another offering in its portfolio without necessarily differentiating the economics involved.
• SAP ran the whole thing over a day, NetSuite was done inside three hours.

But there were some striking similarities. Both companies have a tendency to go down the 'bits and bytes' route while fielding questions when in reality the SME market couldn't care less. They want to know about immediate business value. In that sense, NetSuite does a better job because it is able to concentrate on the cloud story whereas SAP has to pitch two sorts of competing story with ByDesign and All-in-One.

Listening to NetSuite customers, it was clear they made decisions based on the maturity of the NetSuite service at the time compared to other offerings in the market. It will be interesting to see how NetSuite fares once SAP puts its marketing foot on the gas pedal.

As I noted before, SAP can play the brand card where NetSuite has yet to achieve significant visibility. In the UK for instance, it is almost unknown. Talking to other analysts in the US, it seems you either know NetSuite and love them or you don't know who they are.

In the accompanying video, Zach talks about competitive marketing, cost compares to on premise applications and gives a hint about NetSuite's next big thing.