There are many ways to become a software reseller in 2020. Some of them are similar to any other type of reselling: you buy a product and sell it on at a profit.
However, there are other options. Affiliate marketing, for example, means you get paid for referring customers to a company. Or you can become a value-added reseller that sells software as part of a service package.
This means people with different skillsets and contacts have software reselling opportunities. In this article, we’ll explore how to become a software reseller in 2020.
Table of Contents
- 1 How Does Software Reselling Work?
- 2 How to Be an Effective Reseller
- 3 How to Get Started as a Software Reseller
- 4 Top Software Reseller Programs
How Does Software Reselling Work?
Each type of software reselling works in a different way. Let’s take a look at some of the most common methods below.
Affiliate Marketing Model
Affiliate marketing is the most basic form of software reselling. In this business model, affiliates promote the software to their audience and then take a cut of the sale price when a customer buys the product.
While the affiliate does most of the marketing, the software company processes the sale. The affiliate doesn’t usually have any say in the process once they have made their referral. They don’t worry about converting the lead into a customer, and they don’t have to offer any after-sales support.
Affiliate marketing is an excellent choice for people with access to a broad audience who are interested in specific software products. The wide variety of software available means that there are solutions for many different audiences.
Major players in the software affiliate marketing game include PCMag and G2.com.
The Agent Model
Software reselling agents are those that find software for their clients. These agencies will typically help enterprise clients who lack the time or expertise to find software themselves.
Agents may charge a flat fee to organize the company’s software, or they may charge a percentage of every deal. Either way, the agent acts as a connection between the seller and the buyer. The software is sold under the software creator’s brand.
In the value-added reseller model, a business that offers a particular service can resell the software that is necessary for them to provide the service to clients.
- An inbound marketing firm can license and resell CRM software.
- An IT security firm could license and resell antivirus software.
- An accounting firm could license and resell accounting software.
In this model, the reseller will typically receive a referral fee from the software provider.
In the white label model, the reseller takes a software product and sells it under its own name. The reseller typically pays the software creator a flat fee and can then do what it wants with the software.
The reseller has to take care of marketing and selling the product. As the whole sales process takes place under the reseller’s brand, the client may not be aware that a different company created the software.
Rebranding is also often used as a way for agencies to offer an extra service. For example, a marketing agency could provide its customers with an app using a white label app builder.
Resellers who use this model have more freedom when it comes to pricing than affiliates, which can lead to more significant profits. However, they also have to deal with all customer interactions.
Source Code Model
Occasionally a software provider may sell software source code. This allows the reseller to adapt the code as they see fit and package it as their own product. In this model the reseller has the most control, but they will also require some expertise to adjust the code to suit the needs of their clients.
How to Be an Effective Reseller
Whichever method of software reselling you choose, many of the factors that make you successful will stay the same.
Be Good at Selling and Marketing
As a reseller, the most important part of your job is to sell the product. This means you should be skilled at sales and marketing.
The specific skills you need will vary. If you’re selling consumer software, which is typically low price, you’ll have to sell at large volumes to make a worthwhile profit. In order to be successful you’ll need to be able to promote the product to a wide audience.
On the other hand, if you’re reselling high-ticket enterprise software you’ll need to be skilled at managing longer sales cycles. While you’re likely to sell far fewer units than consumer software resellers, the high value of enterprise software means it can still be lucrative.
Have an Existing Audience (or Be Able to Build One)
When reselling software, it can help if you have an existing audience or group of potential customers you can sell to.
For example, if you have a blog with a broad readership you may find success with affiliate marketing. On the other hand, someone with many small business contacts may find success rebranding B2B software.
The key is to choose a product that will appeal to the people you can reach.
Understand the Customer’s Issues
You don’t need to be an expert in a particular industry to resell software successfully. However, you should have a good understanding of the issues your customers are facing. This will allow you to position the software you are selling as a solution to these problems.
Positioning is Key
Often you won’t be the only person reselling a particular piece of software. If this is the case, you need a way to differentiate yourself from established resellers.
One way to do this could be to choose a niche you know a lot about and sell the software to customers in this area.
How to Get Started as a Software Reseller
It’s relatively easy to get involved with software reselling as programs are widespread. Here are some points to consider.
Choose Your Method of Reselling
First, you need to choose which method of reselling is best for you. Affiliate marketing will typically involve the smallest commission, but you’ll be the least involved in the selling process. Meanwhile, relabelling typically has higher profit potential but you’ll have to balance this by taking care of the entire sales process and offering after-sales support.
Choose a Product
You then need to choose a software product to resell. Look at your audience or contacts to see which product they will be most interested in. You should also consider the individual characteristics of each piece of software. Here are some things to look out for:
- Is the software any good? No matter how experienced a seller you are, if the software isn’t strong you’ll struggle to make sales. Be sure to choose a product that offers genuine value to your clients.
- How much will you earn per sale? This is important, although you should be aware that it’s not always the case that the platform that pays the most will make you the most money. A better product or one with a broader audience may be worth a lower fee per sale.
- Is there any recurring revenue? Some SaaS businesses don’t just pay for the initial referral but also subsequent payments.
- Does the software creator provide marketing materials? Often software providers will give their resellers materials they can use to help with sales and marketing.
Approach Software Companies
The next step is to approach the companies and agree on a contract to resell the product. Many software providers will already have a program set up that defines rates and other important details.
Once you’ve chosen your software, it’s time to start selling. If you choose the right product and one that is suitable for your audience, it shouldn’t be too long before the sales start coming in.
Top Software Reseller Programs
The best reseller program will ultimately depend on your skills and connections. Here are some reseller programs that may be of interest.
The AppInstitute reseller program enables you to provide and build apps for businesses under your brand.
You pay a set monthly fee but are free to choose your own pricing. This allows you to earn a significant amount of monthly recurring revenue.
It’s an ideal solution for a marketing agency that wants to start offering apps, or for individuals with strong sales skills and a network of small businesses they can pitch to. Find out more about AppInstitute’s reseller program by clicking here.
Mailjet and Email Marketing
Mailjet is an email marketing solution that has several reselling options. This includes a full-featured white label product as well as a reselling program that lets you offer services to your clients. You can find out more at Mailjet.com.
Additionally, many email marketing solutions have affiliate programs that can be highly lucrative. For example, GetResponse offers either a $100 one-off payment or a monthly 33% recurring commission for new account signups.
The company also provides a 120-day cookie, which means you’ll still receive a commission if someone clicks on your link and then buys the product four months later—assuming they haven’t clicked on another affiliate link since.
McAfee Antivirus has a large variety of reseller programs that allow companies to offer IT security solutions to their clients. The company provides training and marketing support for all its resellers. You can find out more information here.
HubSpot has an affiliate program and an agency partner program.
The agency partner program lets agencies resell HubSpot to their clients for a monthly fee. In exchange, they get 20% of the first year’s revenue.
The affiliate program offers commissions of up to $1000 per purchase if the person you refer signs up for an Enterprise plan. Even basic plans provide a commission of $250. HubSpot provides a 90-day cookie and lots of marketing material.
If you have a way to get in front of business owners who need CRM, this could be an excellent way to earn money.
Good luck with your reselling endeavors!