SaaSletter - More AI ROI: ETR + McKinsey
SaaSletter - More AI ROI: ETR + McKinsey
Plus Our New Sales Engagement Software Quadrant
2024 Sales Engagement Software Quadrant
We released our Sales Engagement Platform Software Quadrant for 2024.
Through Cloud Ratings research partnership with G2, the Sales Engagement Software Quadrant has been enhanced with ROI, implementation timelines, and customer mix data from G2.
ETR's State of Generative AI Survey: ROI
I wanted to flag this report (email required) from Enterprise Technology Research (ETR), especially given the sample: n = “1,768 IT decision makers, with nearly a quarter of respondents representing Global 2000 organizations.”
Applying some assumptions, the weighted average AI payback period appears to be 8.5 months.
Relative to our ROI of Software Benchmarks, the ETR survey GenAI payback would be slower than traditional software (6.8 months). Interestingly, the ETR GenAI paybacks are close to our “Development + IT Management” (8.0 months) and “Data + Analytics” (7.6 months) categories.
Additionally, the ETR survey GenAI payback would be slower than the ROI requirements from G2’s 2024 Buyer Behavior Report - 78% want ROI in less than six months:
ETR's State of Generative AI Survey: Willingness To Pay
This “willingness to pay for an existing vendor’s embedded generative AI offerings” data from ETR is phenomenal.
The average works out to 3.3 out of 5, so it's literally a bit above average.
Of course, the key question is, “What is priced in?” for AI pricing?
Based on my Twitter survey (with caveats on sample size + my high proportion of *investor* followers):
My survey’s AI willingness to pay average is roughly 2.4 out of 5 (even as low as 1.9 depending on how you map to ETR’s framework): Twitter “consensus” on AI buyers’ willingness to pay is at least 28% below ETR’s 1,768 IT decision maker survey.
McKinsey’s “The State of AI in Early 2024”
I missed this late May 2024 McKinsey AI report, which covers a lot of ground and is worth a full read.
My excerpts are “ROI of AI” focused:
For *Generative* AI:
For *Analytical* AI:
My take: Zooming in on the graph buckets (“Decrease by <10%”, “Decrease by 10%-19%”, etc.) and distributions show that *typical* gains from AI are more moderate than headline-grabbing (see Walmart 100x recently, Klarna earlier in 2024), *selective* disclosures:
About Cloud Ratings
In case you missed it, we recently announced a research partnership with G2 - more here:
with this slide showing how our G2-enhanced Quadrants, this newsletter, our podcasts, and our growing True ROI practice area (see Ivan Arizaga’s appointment as a Principal Analyst) all fit within our modern analyst firm:
