Businessmodel of Blackbaud

Customer Segments

Blackbaud has a niche market business model, with a specialized customer group. The company targets its offerings at nonprofits, foundations, and other charitable giving organizations, as well as academic institutions both large and small.

Value Proposition

Blackbaud offers four primary value propositions: accessibility, performance, risk reduction, and brand/status.

The company creates accessibility by providing a wide range of options. Its portfolio includes solutions for digital marketing, fundraising and relationship management, analytics, payments, grant management, school management, advocacy, volunteerism, and corporate social responsibility.

The company demonstrates strong performance through tangible results. Specific positive outcomes for clients include the following:

• The University of Central Missouri Alumni Foundation used Blackbaud’s solutions to introduce a more robust fundraising platform, resulting in the raising of $1,300 in just a few weeks
• Sisters of Charity used Blackbaud’s data enrichment feature in its Raiser’s Edge product to identify lost donor records, resulting in the raising of 200% more funds than expected
• Good Shepherd, a provider of human and social services, used Blackbaud’s to enhance its fundraising operation, resulting in a 35% increase in online giving from donors The company reduces risk by maintaining high security standards. It is certified as meeting the Payment Card Industry Data Security Standard (PCI DSS) and the Payment Application Data Security Standard (PA-DSS). To obtain PCI DSS certification, it had to demonstrate compliance with 12 security requirements by reviewing its technology environment and information security policies and procedures. It has configuerd every application that stores, processes, and transmits cardholder data to be PCI DSS and PA-DSS compliant.

The company has established a strong brand due to its success. It serves over 35,000 organizations in more than 60 countries. They use its technology to raise, manage, invest, and award over $100 billion per year. It has operations in the United States, Canada, Australia, Ireland, and the United Kingdom. Lastly, it has won many honors, including the following:

• Recognition as one of the Ten Best Support Sites in 2016 by the Association of Support Professionals
• Recognition as one of the Best Technology Companies in 2016 by the Charleston City Paper
• Recognition as one of the top 500 companies in 2016 in *Software *Magazine
• The TSIA STAR Award for Innovation in the Execution of Education Services
• Recognition as having “Must-Have Software for Nonprofits” by Hosting Advice ### Channels

Blackbaud’s main channel is its direct sales team. The company promotes its offerings through its website, social media pages, and participation in webinars, trade shows, roadshows, and technology seminars and conferences.

Customer Relationships

Blackbaud’s customer relationship is primarily of a personal assistance nature. The company assists customers in the following ways:

Support Services – The company provides phone, e-mail, live chat, and social media support.

Training Services – The company operates Blackbaud University, a training program that offers courses in live one-on-one, virtual one-on-one, and live classroom (at public locations or at the client’s site) formats. Participants can also achieve certification to demonstrate their knowledge.

Professional Services – The company provides consultants who offer implementation, conversion, and customization services for its software solutions. Specific services are as follows:

• System implementation
• Database production activities
• Database merging and enrichment, and secure credit card transaction processing
• Data conversion, business process analysis, and application customization
• Website design services Despite this orientation, there is a self-service component. The company’s website features a “Resources” section with useful tools such as white papers, tip sheets, research reports, and videos. The site also provides answers to frequently asked questions.

Key Activities

Blackbaud’s business model entails designing and developing its software products for customers and providing related services.

Key Partners

Blackbaud maintains the Blackbaud Partner Network, which includes the following partnerships:

• Blackbaud Technology Partners – The company works with firms that have complementary products to extend the functionality of its solutions. Specific partners include ActionSprout, BizNet Software, Charity Dynamics, EverTrue, Fusion Labs, Goodshop, Hep Development Services, and Kaymbu.
• Blackbaud Solution Providers – The company works with firms that provide implementation services to its customers, including product configuration/customization and data migration. They also offer extra services such as web design, graphic design, interactive strategy planning, and campaign planning. It ensures their qualification to do so through training and testing. Specific partners include Beaconfire Red, Cathexis Partners, DNL OmniMedia, Event 360, and Method Works Consulting.
• Blackboaud Channel Partners – The company works with firms that resell and co-sell its products in order to extend its reach. Specific partners include Capital Business Solutions, JCC Consulting Group, JMG Solutions, nfp Accounting Technologies, NP Solutions, SVK Consulting, and Zobrio.
• Blackbaud Alliances – The company works with various firms to foster growth and innovation in technology options for the nonprofit industry. Specific partners are Microsoft, Salesforce, and AICPA. ### Key Resources

Blackbaud’s main resources are its human resources, who include the engineers that design and develop its software, the sales personnel that promote it, the training/consulting staff members that provide instruction/advice, and the customer service employees that provide support.

Cost Structure

Blackbaud has a value-driven structure, aiming to provide a premium proposition through significant personal service and frequent service enhancements. Its biggest cost driver is cost of subscriptions. Other major drivers are in the areas of sales/marketing and cost of services.

Revenue Streams

Blackbaud has four revenue streams:

• Subscription fee revenues
• Maintenance fee revenues
• Service fee revenues
• License fee revenues