Advice for Remaining Competitive in This IT Channel Landscape

Distribution marketplaces or digital platforms have a broader focus across many vendors, and they can enable multivendor solutions for partners to take to their end customers.

April 25, 2024

4 Min Read
The growth of marketplaces and other digital platforms is helping partners navigate the current environmental complexity.
Distribution MarketplaceGetty Images

The technology market is at a very interesting intersection in 2024, balancing between the promise of innovation and ongoing questions around the state of the economy. Speaking of the economy, IDC's latest end-customer surveys* suggest that customer confidence in the economic outlook remains questionable, and this might influence budget allocation for the foreseeable future. On the flip side, continued innovation acceleration, including the GenAI wave, suggests a technology impact on the top and bottom lines.

At a foundational level, the past few years have seen all customers accelerate their acceptance of digital transformation — and technology in general — out of necessity to remain competitive. However, the accelerated technology innovation trend has also continued, meaning the breadth of choices has grown exponentially, and this in turn has increased the complexity.

IDC recently completed a partner study in North America (NA) and other regions. A couple of the notable survey insights for vendors and their technology partners:

  • Partner business mix continues to expand into other areas. The NA partners surveyed suggest that they cover, on average, 3.2 legacy business models (VAR, CSP, MSP and ISV, among others) as part of their activities.

  • Vendor relationships are fewer in number. For the total NA partner survey, the average number of vendor relationships was 5.4 vendors per partner. Each of these relationships can require significant resources to manage, and the trend is toward reducing the number of partners.

  • Two-thirds of partners self-report running a mature cloud business, but 70% are in the early stages of the AI maturity curve. These maturity indexes illustrate the challenges for partners to adopt and transform alongside the market pace.

Additional insights can be found in this newly-released IDC Analyst Connection paper.

The survey also reveals the top five challenges partners are currently facing. Interestingly, many of these challenges are also highlighted as opportunities. For vendors and providers of these partners, the takeaway is that partners are transforming their businesses but also looking to navigate the complexity and opportunity alongside their end customers. The focus should be on providing clarity and transparency for partners to evolve, and of course to do this with simplicity.

One trend that is helping partners navigate the current environmental complexity is the significant growth of marketplaces and other digital platforms, enabling partners to expand their focus with customers by utilizing these go-to-market platforms provided by vendors. Marketplaces are growing fast as an accepted route to market for customers and partners. However, they tend to be focused on the specific vendor's technology with selected third-party offerings. Distribution marketplaces or digital platforms have a broader focus across many vendors, and they can enable multivendor solutions for partners to take to their end customers.

These digital distribution platforms act as a continually evolving catalog of multivendor solutions that a partner can present to their customers. Partners can add new technology or solutions to their portfolio via the platform. The platforms have also evolved to enable partners to have visibility and control of real-time pricing and billing, optimization of usage for customers, and SecOps and FinOps functionality to enable partners to provide the optimal solutions for their end customers.

The role of digital distribution platforms is to enable partners to provide a larger catalog of digital technology offerings to customers and effectively manage their customer portfolios at scale. The integrated capabilities that ecosystem orchestration platforms (EOPs) provide can cover pricing and billing, subscription management and optimization, usage intelligence, identity management, analytics and reporting, and much more. The distribution EOP can become the evolving partner catalog and customer management system that allows partners to provide greater technology solutions to their customers as they navigate the rapidly changing market — and grow their businesses as a result.

For partners to remain competitive in today’s fast-paced environment, one key piece of advice is to clarify what their differentiation strategy and focus are today and where they would like to be tomorrow. In effect, partners need to place some key bets in a rapidly evolving environment and plan for what’s next.

Arrow’s digital distribution platform, ArrowSphere, provides IT channel partners with flexibility, freedom and control to take their business to the next level. For more insights, read the full newly released IDC analyst connection paper.

*Source: IDC Analyst Connection, sponsored by Arrow Electronics, Digital Distribution Platforms Enable Partners to Navigate Technology Complexity for their Customers, doc #US51984824, April 2024.

This guest blog is part of a Channel Futures sponsorship.

Free Newsletters for the Channel
Register for Your Free Newsletter Now

You May Also Like