Snowflake is delighted to share the findings of a new Forrester Consulting Total Economic Impact (TEI) study that examines the potential return on investment for organizations that procure Snowflake through Amazon Web Services (AWS) Marketplace and then use Snowflake as a core part of your application’s architecture. We commissioned the study in partnership with AWS.
To conduct this research, Forrester interviewed individuals from eight companies, including a mix of Snowflake customers and AWS Marketplace customers who use the Snowflake platform, to obtain data on costs, benefits, and risks associated with their technology investment. From there, Forrester designed a composite organization based on the characteristics of interviewed customers, who ranged from the CTO of a pharmaceutical software company to the procurement manager for an IoT company.
Before using Snowflake’s platform, the interviewees had built data applications on top of multiple on-premises and cloud solutions, which meant that their customer data was siloed. As a result, connecting and loading data from different vendor solutions was complex and time-consuming, and they struggled to support the evolving data needs of their organizations. The companies also found that legacy data platforms didn’t support the aggressive implementation timelines required to launch new products.
The study quantifies the benefits, which have been risk-adjusted and presented in the context of the composite organization, of procuring Snowflake through AWS Marketplace and then building apps on Snowflake. Those benefits include:
- Labor cost savings of $2.3 million resulting from faster time to market. AWS procurement processes and the Snowflake Data Cloud enabled the composite organization to launch new products and updates in half the time—and with half the labor cost. For example, one interviewed organization launched a new product within 10 months of implementing Snowflake, which “could easily have taken us two to three times the time with the same number of resources if we used our previous procurement processes and development platforms,” said the company’s VP of Data Engineering.
- Increased profit of $2.2 million from faster time to market. As a direct result of launching products and updates faster, interviewed customers reported realizing revenue sooner, which translated into higher profits. One interviewee reported launching a product a year ahead of schedule because of Snowflake, which meant that “more revenue was generated sooner.”
- Cost savings worth $4.8 million on infrastructure and data platform management. Snowflake had higher performance and scalability than the legacy platforms previously used by interviewees. A software company reported reducing its data processing time by 50%, for example. Additionally, Snowflake required a smaller infrastructure footprint and fewer DevOps resources for ongoing maintenance. “We used to move 21 to 25 terabytes per day from another data processing platform to the previous data warehouse; we reduced it to 4 to 5 terabytes with Snowflake,” said a technical operations manager. The software company derived direct cost savings by reducing its computing and storage footprint.
Overall, Forrester found that the composite organization would accrue about $10 million in present value of risk-adjusted total benefits over a three-year-period versus $2 million in costs. This equates to a net present value of $8 million and a return on investment of 405%.
At Snowflake, we’re glad to confirm that our partnership with AWS Marketplace is delivering cost savings and incremental revenue for our customers, but we’re still not satisfied. We plan to stay focused and continue innovating to improve the bottom-line impact our Data Cloud delivers.
To access the full study, The Total Economic Impact of Snowflake’s Platform for Application Builders Procured Through AWS Marketplace, click here.
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