Q3 Agent Survey: Direct Sales, Technology Evolution Pose Challenges to Advisors

Conflict from direct sales reps represented the big source of competition to the technology advisor (agent) channel. That’s according to a new survey.

Channel Futures for the first time ever is publicizing results from its agent quarterly survey. The questionnaire functions as part of Channel Futures’ quarterly Partner Industry Outlook survey, asking specific questions geared toward the commissions-based agent channel. The results paint a picture of agent growth, portfolio evolution and shifting TSD alliances. Channel Futures’ first quarterly agent outlook survey took answers from 32 respondents who identified their firms as agents or subagents. While not a large sample size, the answers nevertheless shed light into the challenges facing partners.

Silver Linings

Respondents expressed moderate optimism about the economy compared to the macroeconomic concerns about recessions and layoffs. For example, 39% of agents said their confidence in the U.S. economy is good, and 7% called it excellent; another 36% called it average. On the other hand, 14% called it poor, and another 4% called it terrible. Moreover, agents feel better about the state of the channel than they feel about the larger economy. The majority of partners (57%) rated the health of the industry as good; another 18% considered it excellent. On the flip side, 18% of respondents described the health of the industry as average. Seven percent called it poor, and no one rated it as terrible.

Perhaps most importantly, respondents said customers remain as willing as ever, if not more willing, to purchase technology.

Source: Channel Futures Quarterly Partner Outlook. Question 13.

Forty-three percent said customer appetite increased, while 50% said it stayed the same.

The Changing Shape of Agencies

The results of the study indicate that partners are growing in terms of personnel.

Twenty-nine percent of respondents said they grew their full-time headcount in the third quarter compared to a year prior. The majority (71%) stayed the same, while no respondents reported a decrease in headcount. That’s an excellent sign of partners’ confidence in their business model, considering the stampede of vendors to cut people.

Agents appear to be targeting a diverse set of customers. The survey asked respondents to list the market segments they pursue, and an even balance emerged. Fascinatingly, respondents selected SMB the most (45%), followed by midmarket (42%).

Biggest Challenges

Respondents noted the biggest obstacles they face. Keeping up with advances in technology proved the most common challenge, with 35% of agents selecting it. That was trailed by vendor relationship management and creating recurring revenue streams (29%). On a similar note to creating recurring revenue streams, 25% of partners said are challenged by adding managed services to their portfolio. Those observations fit well with the trend of more agents offering professional services, including deployment and life cycle management.

It’s worth noting that 61% of agents said they …