One of the most common criticisms of Google’s Apps business is that it’s just a bunch of small companies using the free version of Google Apps. But is that really true? We did a little research to find out, as summarized in the infographic below.
Over 8,000 businesses have signed up for a trial of our Google Apps backup product, or Snapshot – our Google Apps account download tool. When someone signs up for a trial, one of the pieces of information Google sends us over the API is the total number of seats on the domain (which we use for capacity planning). As a result, we have a nice sample of data to look at to see who is on Google Apps*.
Now, to be clear, this is not a random sample. This sample consists of people who want to buy backup for Google Apps. And in our experience, it skews towards domains with at least 30+ users. Why? Because that is the point where companies add an I.T. person, and I.T. pros are the ones who love to buy backup for anything and everything. Our close ratios on larger companies are much, much better than on the small ones.
But getting back to the data… what does our sample of companies on Google Apps say about the Google Apps ecosystem? Here are some inferences that can be drawn based on the data:
1. Most of the domains are small
As you can see from the chart, 53% of the domains are 10 seats or less, just what you would expect based on what you hear in the tech media about Google Apps. Domains with 10 or fewer seats are free, and free is a popular price point. But that doesn’t tell the whole story.
2. The number of small domains doesn’t matter because the big domains overwhelmingly drive revenue and seats on Google Apps.
Notice that 0.33% of domains drive 54% of seats. Even with educational institutions removed — Schools also get Google Apps for free, regardless of domain size — 0.22% of domains drive about 40% of seats. If that ratio holds true across Google’s number of 50 million total Google Apps users, then more than 20 million paying business users are on Google Apps. If that’s the case, Google Apps should be closing in on a billion dollar annual revenue run rate.
I will add that, based on our data, it also seems that the average size of a Google Apps deployment is increasing. That is, larger and larger accounts are moving to Google Apps.
3. If you sell a per-domain product in the Google Apps marketplace, you should probably customize it for smaller accounts. If you sell a per-seat product, you should probably customize it for larger accounts.
Selling add-ons to Google Apps can be difficult because the large customer base spans many customer segments — more than most small companies or startups can target. Very few solutions work for mom & pop accounting firms and real estate offices and also work for large universities and software consultancies. But, because Google Apps is relatively young, there is a lot of whitespace around the product, and thus lots of add-on opportunities for those who find their niche. Moreover, Google has increased staffing in their partnership department this past year, signaling that they take their partners seriously and want to build a strong ecosystem that includes add-on developers.
4. If you remove educational institutions, the largest industry on Google Apps is the technology industry.
No surprise there. But why don’t we hear more about some of the cool tech companies on Google Apps? Well, from dealing with customers in this industry, I can tell you that many of them don’t want to be reference customers and don’t want any publicity. But there are some big names on Google Apps, some that would surprise you.
That is our take on the Google Apps ecosystem, based on our own survey. You can see the full infographic here, and of course, if you are on Google Apps and need a backup, sign up for our 15 day free trial.
*Note: All data shared about our Google Apps install base is derived from aggregated user data. We don’t share any customer- or account-specific user data without clearing it with the customer first. If you want to see customer-specific data, check out our testimonials and case studies.