It’s a question entertained by a lot of companies looking for software solutions to problems that are not directly related to their core product or offerings.
Long gone are the days when enterprise software was only considered as off-the-shelf offerings.
Many companies today, especially ones with in-house tech infrastructure, have the luxury of building their own software solutions.
Though just because they can doesn’t mean its always a good idea.
Let’s consider the case of influencer marketing software.
With the rising popularity of influencer marketing, companies might be tempted to deploy their own platform to run influencer marketing campaigns.
But can it stand up to the comprehensive solutions offered by dedicated 3rd party vendors?
Or will the lack of historical data, as compared to 3rd party vendors, be a cause for failure?
While it may be appealing to have full control over the auxiliary aspects of your business such as influencer marketing, content management, etc. there are many factors that need to be considered before deciding if this is the right step forward.
In this article, we evaluate the pros and cons of both building and buying a software solution.
The most important two resources of a company are skilled people and working capital. Each provides unique advantages and are crucial for the smooth operation of any business undertaking.
When you’re in the midst of deciding whether you should build your own software, take into consideration the size of your tech team and the budget you have available.
Another important resource is the time involved in such a large initiative.
Put together, any company that decides to build their own enterprise software must be aware of the huge resource commitments that go into such a decision.
Or indeed, the resource commitments of buying a solution for the long term.
There are countless tech firms who spend months or years developing robust software so that you can focus on your core business.
So why should you even consider building your own tech solution?
Let’s use an example to understand this: Consider a company with complex business operations. This can be having many processes that are critically connected or simply a unique product.
This business complexity may require a more custom solution to provide seamless integration of all these processes. Something that may be hard to find in off-the-shelf solutions.
Similarly, companies with traditional offerings or simple business processes may not need a highly-customized solution and could run just as well with software already available in the market.
We live in a highly-competitive world.
With new start-ups cropping up by the minute and MNCs flexing their resource muscles to innovate to new heights, companies today face tremendous pressure to maintain their competitive edge.
You may think: “What does this have to do with build vs. buy?”
The point is that seeking a competitive advantage can be another factor when you are choosing between building your own software or buying it off the shelf.
Here it’s important to ask: “Will building a custom software give me a significant competitive advantage?”
The answer will let you decide if its worth building or good enough buying software.
A good influencer ensures their follower-base is regularly watered with good content. They know the importance of staying relevant and keeping up with trends. A lapse in posting may lead to plateauing of the influencer's growth rate or, even worse, a drop in followers.
With the unending waves of content from competitors flooding our screens, it can be frighteningly easy to lose followers.
These factors let us understand not only what makes a top social media influencer but how to rank and choose them for influencer marketing campaigns.
Humans are programmed to want control. It lends a sense of power which is an intrinsic part of human nature.
Building your own software offers a level of control that simply cannot be compared to buying one from the market.
This doesn’t necessarily refer to customizing the solution to meet specific business needs. Ownership control over the solution can offer data security advantages as well.
Though it’s important to note that having control over the software means you need to have a dedicated team of developers to maintain and improve the product.
The old saying goes ‘no risk, no reward’.
But it’s critical to ensure the risk is only taken after considering every possible strategy.
When it comes to the real world, the saying should probably be modified to “a calculated risk, more chance of reward”.
There are several risks associated with building as well as buying software and each must be evaluated and weighed with the other factors and the specific circumstances of a business.
One of the most important factors, which can be easily overlooked, is the specificity of the problem you’re trying to solve.
If your business gap requires a specific solution and one can’t be found in the market, you may have no choice but to resort to building a piece of software to fix the problem.
Alternatively, if your problem is one faced by many others in the market, it’s likely that a specialized solution exists in the market.
In this section we will list out and elucidate the reasons for buying a software solution rather than building one.
The conditions and circumstances for one to buy can vary greatly so it’s imperative to read the following carefully and see if the reasons to buy outnumber the reasons to build for your particular use-case scenario.
If your business is new or you lack investor backing or have other critical investments, it’s important that you prioritize your expenditures.
Developing software is not cheap. Building a software solution can take a huge bite out of your capital as well as team bandwidth.
Let’s again look at influencer marketing software as an example.
Considering the features involved in something as broad as influencer marketing, it is easy to see why development costs can go sky-high. You need to build an influencer database, develop a search engine, design campaign planning features, a reporting interface, etc.
If you choose to buy, you needn’t worry about the hardships of application development such as application testing and deployment, patching bugs, support and maintenance and so on.
The whole endeavour is a long-term resource commitment compared to buying, which is usually a subscription payment a fraction of the price of building and maintaining a product for years.
Some companies require a certain degree of retrofitting with their software solutions.
Some may want their software customized to integrate access for a specific team to ensure a smoother workflow.
Some may simply want white-labelling. Especially if the software is used in client-facing areas of their service structure. This may be to ensure a uniform brand identity or simply as part of organizational philosophy.
If customization is not something that significantly affects your brand or business, then buying an off-the-shelf solution may be the right choice.
Developing a software solution from scratch is no small feat. Especially if you don’t have any existing tech expertise on your team.
From back-end developers to software engineers to front-end developers to UI/UX designers, the breadth of knowledge that goes into creating a piece of software is massive.
If you don’t have a tech team or if your existing team does not have the bandwidth to take such a massive project on top of their main work, buying a solution from the market is probably the best solution for you.
Compared to hiring an entire development team, you may need to hire at most one resource to operate the market-purchased solution. Or simply train your existing employees.
If you plan to develop a software solution, it’s vital to understand that you’re starting from scratch. Developing a solution means learning all about a foreign software architecture, unending research on the subject area, and making many unavoidable mistakes.
Not to mention you will be working with no existing data. The software will have to be used for many months or years before you have enough data to work with.
Let’s once again take the example of an influencer marketing software:
The 3rd party company who created it have specialized knowledge regarding not only the software but the influencer marketing industry as well.
They will have years’ worth of data to understand what metrics to look out for, what trends and analytics are definitive indicators of success in the influencer marketing industry and will have dedicated thousands of hours studying that data to just refining the software.
Unless you’re willing to go through that long and arduous journey, buying it off the shelf would be the optimal option.
How crucial is your need for a software solution?
Is the problem reaching critical mass?
How important is the problem? Is it affecting my core business?
These are some questions you must address before making a decision to buy or build.
As discussed earlier, building a piece of software takes time. Apart from actually assigning a team to build it, the whole process of development, alpha testing, and fine-tuning the software can easily take months and then comes bug-fixing and life-long maintenance.
If your problem requires a quick solution, buying ready-made software is probably the way to go. Just ensure most of the reasons to ‘buy’ apply to you and your company.
To put a positive spin on not having control over a product, it might be a relief to know the burden of maintaining and updating the software is on the 3rd party provider.
Any technical issues you may encounter can be brought to the attention of their support staff. Since it’s in their best interests to ensure quick resolutions, you can sit back and let their team of product experts take care of any bugs or fixes.
Know that you are buying a piece of software from a firm who have dedicated their entire existence towards that software. They know every nook and cranny of the product and are the best persons to bring out the optimal performance from that product.
Building your own software solution can be exciting and empowering. It can pay great dividends in the long run.
If done right AND for the right reasons.
The road to building a homegrown software solution is one filled with many challenges. So you should be extremely sure if it is the route you wish to take instead of buying a solution from the market.
Every decision must be taken without bias and with a strong foundation of reasoning. For the purpose of the build vs. buy argument, we have posited some reasons that give weight to the ‘build’ argument.
The biggest argument for building your own software solution, control over product features, customization, integrations, etc. can help you mould the solution to the specific needs of your company.
It also allows you to add any new features when needed so that your business can run seamlessly. You can begin with a product prototype and develop the software as your business grows to bring additional resources for further innovation.
It’s important to know that this means a high dependency on developers. Not just for developing the product but maintaining it for the rest of its lifetime.
Control over your software opens up numerous opportunities with regards to product modifications and information privacy that simply cannot be replicated with an off-the-shelf solution.
The biggest advantage of building your own software solution is that it will include all the functionality you need for it to operate exactly as you need it to.
It can be tailored to your unique business model, processes and challenges.
Also, if your business is a complex intertwining between departments or functions, it makes sense to build a custom solution that streamlines this ecosystem.
Developing an in-house software solution is a long-term commitment. Perhaps even a permanent one.
If that is the case and you’re willing to put in the time, energy, and resources for the long haul, then building is a realistic option for you.
A custom-built solution can grow with the company. It can be moulded and shaped as the company’s business operations shift and innovate. This kind of customized longevity can only be attained with a homegrown solution.
When a solution is integral to a business’s main activities, it is worth giving serious thought to building a software from scratch.
This realization can occur at the time of inception of the company or may arise due to innovation and progression of the business leading to new challenges that need creative solutions.
For these unique scenarios, off-the-shelf solutions might not provide the desired level of customization or may lack specific integration offerings.
Whatever the reason may be, so long as a software solution is critical to the optimal running of core business processes and no suitable alternative is available in the market, building one is the best way forward.
Whenever you use 3rd party solutions, it's a foregone conclusion that the vendor will want access to data and usage metrics for their development purposes.
Apart from that, they will also have access to your client data, if the software is related to that function. While they will be bound by legal restrictions, the fact remains the data will remain in their servers and its safety will be dependent on the robustness of the 3rd party vendor’s security infrastructure.
When you build a software solution in-house, the responsibility and control over data and organizational information are firmly in your hands.
What better way to represent the difference in cost between building and buying a software solution than with a calculator matrix.
For the purposes of this example, we have showcased the process of building an influencer marketing software from start to finish compared to buying a subscription.
The build vs. buy argument is one that comes up more and more frequently among companies today. With development becoming increasingly accessible and cheaper turnkey solutions being offered across the market, more companies are inclined to build custom solutions to solve specific issues.
The pros and cons of building and buying can vary greatly depending on the organization that’s in question.
Every company must take each argument and evaluate the needs and reasons for each scenario and choose the option that best suits the interests of the individual organization, both in the short term and for the future.
Influencers nurture strong, personal connections with their followers that brands cannot achieve today. The bigger the brand, the harder it is to be close and personable with your followers.
Influencers have the ability to sway the purchasing decisions of their followers due to their expertise, charisma, or authority. By also letting followers into their lives, influencers manage to build powerful relationships based on loyalty and trust.
This is why an increasing number of companies are opting for influencer marketing.
Most believe influencer marketing is as simple as finding a popular social media influencer, connecting with them, and paying them to create posts about your brand.
The truth is:
There's a lot more to consider behind the scenes.
From influencer metrics to audience behaviour, influencer marketing consists of a complex world of data and patterns that make it work.
From choosing the right influencer with the right audience to tracking the performance of every single post, influencer marketing needs a strong understanding of the field and lots of precise data to achieve true success.
With Qoruz, analyzing and understanding information has never been more comprehensive or simple. Take the step towards your first influencer marketing campaign by clicking here.
Here are a few simple steps to help you reach out to influencers: