Indirect Sales Channel to Gain Steam in 2019 and Beyond
… shape their businesses accordingly:
- Buyers are looking for hyper-specialized skills.
- More different types of partners.
- Increasing solution complexity.
- Margin pressures from cloud-delivered everything.
- Long-tail is getting longer.
- Usage and renewal are new key metrics.
Tackling these six trends, the two industry watchers offered some sage insight and advice for partners.
For example, the need for partners to develop hyperspecialized skills is being driven by the fact that not only is technology critical to how businesses of every ilk operate, but line-of-business buyers (executives) spend 51 percent of their time on technology.
“Whether you’re a marketer, sales, operations, finance, HR [and so on], whatever your day job used to be, it’s now your night job,” said McBain.
What does this mean for partners?
“Finding a generalist is not what the interest is when I go and implement a project; I want you to know my line of business,” said McBain. “I want you to be able to talk about midmarketing, top of funnel, leads and get detailed with me on how to run a project and get me more leads.”
Expect to see more individualized or unique partner business types highlighting specialization, verticalization and an understanding of sub-industries by geographies, by sector and size.
Partners should expect to see their vendor partners create and encourage individualized enablement paths and personalization for partners in order to become differentiated and unique in a particular market space, noted Krakora.
In 2018, both IBM and Microsoft introduced programs that focus on partnering with partners, or getting people in the room that haven’t previously worked together. Expect to see other vendors do the same this year.
Whether partners home in on their skill sets, markets or products, the continued growth of different types of partners will emerge. We’ve heard them referred to as shadow channels for the past 18 months or so.
If, as a partner, you’re discouraged by this, you should be if you’re not focused on transforming your own business. The shadow channel is here and growing, but so is the market revenue opportunity for integration and implementation.
“It’s really high margin, higher margin than doing tax and audit, higher margin than doing creative and concierge services — whatever you delivered in the past, you’re going to see this as a major transformation of your own business. So run, don’t walk, to getting into these services,” said McBain.
Krakora suggests that partners, in 2019 and 2020, get serious about finding, recruiting and incenting these powerhouses to get front of the new business buyer.
Solution complexity goes hand in hand with partnering and joining communities, of which there’s a growing number.
Partners can thank cloud-delivered-everything for margin pressures. Focusing on managed service providers, who saw their margins drop from 30 to 40 points about 15 years ago to 17 percent in 2018, are struggling to grow their business. As a result, there’s been market compression and consolidation, as the MSP market has reached maturity.
“MSPs have started to look for other things, such as security and becoming an MSSP as one way to start building back margin,” said McBain. “However, in the cloud world, there’s a whole set of downstream services the channel is skilled to do.”
Here, he refers to services for integration, implementation, security, compliance and …