Add-on

How they do it: Customers are able to purchase SAP’s core software offerings for a competitive price. After signing a contract, customers are encouraged to purchase add-on products (e.g. CRM system) to leverage the full potential of the SAP software suite.

Digitization

How they do it: SAP pioneered ERP software, the integrated management of core business processes via software. Historically, ERP processes – such as finance, accounting, payroll or CRM-related processes – were done manually. With the advent of computing, SAP signed its first client in 1972, a German chemical company, for which it developed cutting-edge mainframe programs for payroll and accounting.

Guaranteed Availability

How they do it: For it’s cloud platform offering, SAP’s System Availability SLA is 99.5%, meaning, that during any time period, SAP’s customer can count on the software to be available for this percentage, and is otherwise compensated according to a service level agreement.

License

How they do it: SAP enables customers to license its software products and offerings in a variety of ways. These include for instance perpetual, subscription-based, or consumption-based licenses. This flexibility allows SAP to serve a group of customers with heterogenous customer needs.

Lock-in

How they do it: Data lock-in risks become evident when you need to move your data from one software vendor’s systems or servers to another. Companies using SAP’s software are locked in to the SAP ecosystem and may face difficulities in organizational rigidity and switching costs when deciding to switch to a competitor’s system, leading to a competitive advantage of SAP.

Solution Provider

How they do it: SAP offers coverage over a wide range of areas via its enterprise software to manage business operations and customer relations. In 2017, there were over 300 individual products in its product database, covering virtually all aspects of ERP systems and software. It’s estimated that 77% of all global business transactions come in contact with an SAP system.

Subscription

How they do it: For SAP’s cloud platform, subscription terms start at €399 per month. Customers gain access to a dedicated dedicated SAP HANA instance and other services.