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December 29, 2023
Artificial intelligence is transforming business operations across industries, but only about 20%-30% (PDF) of all channel offerings being delivered to end-customers utilize AI. And according to Canalys, the potential AI-powered business opportunities for channel partners are anticipated to rise to US$158.6 billion by 2028, including things such as AI services, AI software development and reselling of AI products.
With this demand, channel partners such as value-added resellers (VARs), system integrators (SIs), distributors and managed service providers (MSPs) have a chance to tap into this growing trend and create numerous strategies to capitalize on new revenue streams. Here's how.
Today, 41% of channel partners are optimistic about AI-related business potential, and how their end-customers' use of this technology will create new demand for services. For example, organizations using AI will be producing more data than ever before, which means more data for channel partners to manage, to protect from risk and ransomware and to back up.
Further, the influx of additional, AI-generated data will require information management policies and practices that channel partners can provide, if they're not already doing so. MSPs and VARs can leverage this and assist businesses with this evaluation process, ensure robust data governance and ethics and implement safety practices as they utilize generative AI software. With an informed and consultative strategy, MSPs and VARs can lead customers through AI adoption, if this is something they plan to use within their organization.
With technology giants opening their software development platforms and pool of experts to keep up with the generative AI trend, channel partners have a greater shot at creating and offering more AI-based capabilities, including customized solutions, to their customers to help solve those challenges.
For example, teaming up with companies such as Google, Microsoft and Amazon Web Services provides SIs and VARs access to prebuilt AI modules, infrastructure and support resources that enable faster development of AI-powered products. They can now integrate conversational interfaces, predictive analytics and more into their solutions more quickly and cost-effectively.
These partnerships also allow channel partners to focus their in-house talent on developing industry-specific models that provide greater value to their target customers. With prebuilt frameworks managing much of the underlying infrastructure, channel partners can direct resources toward understanding customer pain points and fine-tuning solutions to address specific business needs. This domain expertise is key for delivering robust vertical AI applications and allows channel partners to reach the market faster with intelligent features while maintaining their competitive edge.
In the IT and broader technology industry, it's easy to think that everyone is aware of the disruptive potential for AI. But many of the end-customers channel partners serve are newer to this technology or may not have the use cases as easily identified.
For example, channel partners may have end-customers who operate local small businesses and aren't actively using AI. In those instances, channel partners can provide helpful education and identify potential opportunities for this technology that are as simple as generating first drafts of marketing emails or social posts for a local retailer. In fact, according to a study conducted by MIT, ChatGPT alone has been shown to increase productivity by approximately 40% across all industries.
These types of educational services are just as beneficial and can be easily overlooked by practitioners who are already using this technology themselves. Similarly, providing general safety recommendations — like keeping proprietary information out of open-sourced AI like ChatGPT, which gets smarter over time — can be incredibly useful.
Finally, channel partners have an opening to help businesses with the emergence of generative AI. But before jumping into the increasingly competitive AI space, channel partners should create a detailed plan for how they will stand out.
Determining the right customer segments, pricing and sales tactics will be crucial to drive adoption. Taking an incremental approach, focusing on use cases with clear ROI and leveraging partnerships can smooth the path to integrating generative AI and making money from this emerging opportunity.
Tom Lin serves as chief revenue officer for AvePoint. He previously was its chief customer officer and VP of sales, where he led the global enterprise, midmarket, SMB and channel sales strategy. He began his career there as the company's first sales representative.
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