Adii Pienar, one of the founders of WooThemes posted an interesting post the other day, entitled WordPress + SAAS. He raises some great points about why we don't see more companies working with WordPress in this way, he cites VaultPress as a successful example.
This is a model I have been thinking about a lot lately, I sell some commercial WordPress plugins and do very well with those but I'm reliant on gaining new customers all the time as they are sold on a one-off basis. If you run a service, you are guaranteed a level of income each month providing your customer retention is good (churn rate) and customer acquisition costs are not too high.
I also have experience building a service company around open source software, my first company was a forum hosting company based around phpBB - I grew it to one of the largest, eventually hosting over 250,000 forums on multiple servers, before the company was acquired. I worked using a freemium model, anyone could sign up for free and have their own forum - I made money from advertising on the forums and paid upgrades which removed the adverts and let people use their own domain names, essentially how WordPress.com works now.
I think the service model is ripe for WordPress at the moment, so in the post I'm going to take a look at some of the options at the moment.
Not exactly revolutionary but companies like Page.ly are different by taking care of WordPress updates and plugin updates, as well as managing backups etc. Its a great idea which effectively turns self-hosted WordPress into a service similar to WordPress.com but with the benefits of adding any theme or plugin you like and customizing how you see fit.
Using the new multi-site capability built into WordPress you could offer free hosted niche blogs with paid upgrades. Basically offer what WordPress.com do but by targeting at different niches you can offer more suitable themes and plugins as well as build a community around your hosted blogs. A site that does this well is Edublogs, they currently host over 900k blogs for students, teachers, schools and universities. Money is made via advertising and paid memberships.
Some niches I can think of this would work in : Hobbies (fishing, sports etc), Automobiles, Photography, Artists (offer a range of portfolio themes), MicroBlogging (like tumbler, offer Tumblog themes).
It's going to be hard to compete with VaultPress in this area unless you go with price (VaultPress is $15 per month upwards) or you can offer something unique (smartphone app management?). $15 per month seems quite steep for most personal blog owners, especially when you can use a plugin like BackupBuddy with Amazon S3 storage which costs pennies per month. Many personal blog owners will not see the value as most hosting companies include backups by default.
Management tools allow people to control a large number of blogs from one place, Manage WP this week just crossed the 20k blog mark. Another service I was notified about this week is WebPub, here is a description of their offering :
WebPub is an intuitive web interface for installing, importing, managing and upgrading popular web applications. All you need is a browser: No command line, ftp software, config files, etc. Once you've installed or imported your sites, WebPub can upgrade them automatically, whenever new versions come out, for free.
Sounds good, as WordPress grows in popularity I can only see the demand for this sort of management services growing.
There are a huge number of eCommerce plugins and themes available for WordPress but as far as I know, no one yet has created a hosted eCommerce service similar to Shopify. I think this is a huge market for people wanting to sell a few items from their blog or website but dont want to tackle the technical challenge of running an eCommerce site themselves. By making the service easy to signup for and add items and then either taking a cut of each sale or a monthly fee for hosting the shop I think someone could build a viable SAAS business this way. The MarketPress plugin from WPMUDev allready provides most of this functionality.
Ive listed here some of the common ways that people can provide commercial services for WordPress - The WordPress market is so huge and will only get bigger that I think the market will support multiple companies in each area. There is always a first mover advantage though so if you have a unique idea that hasn't been done I would get started on it right away. Some areas which haven't been tried with WordPress yet - SEO / Social Media services, Analytics / Conversion Tracking, Client Management, Sales Automation, Help Desks, Document Management.
What do you think about this area of the market for WordPress ? Do you have any ideas of services which would work for WordPress ?