The Channel Ecosystem is THE route to market

It’s at times painful to see even senior leaders in the technology industry, unable to see the value of the channel. To me, it is THE route to market and more so at a time like this.

Let me reiterate why I think this is now a non-negotiable rather than an option:

 1.    Customer buying behavior has changed in multiple ways: They want the freedom of choice and alternatives when it comes to the cloud platform, for example. They want service providers and solution players with their unique intellectual property (IP) to be multi cloud.  There are times that that they will double click on the platform the solution will reside on but that is fast changing too: they are moving to be truly solution centric and platform agnostic. Customers also want less complexity and want a 100% accountability to be with one ecosystem player for that solution.

And hence as a vendor you should have your best people focus on the partner to build, market, sell and scale their solution. You need to invest time in ensuring the partner does understand that building their solution on your platform or integrating your SaaS offering has the most economic benefit not just in terms of the immediate sale and the time taken to close a deal but the services revenue and downstream revenue opportunities. It is also essential to make the Ease of doing business, a truly easy experience. There is a cost of sales involved which at times far outweigh the upfront margins a vendor offers. I cringe when I hear some vendors not realizing that while their upfront margins to a partner may be the highest in the industry, they are still not the #1 choice, given the CoS or ease of doing business &/or their channel policy.

2.    Trusted Advisors: Leading Ecosystem players have scaled up their offerings and services to end customers to become the “go to” organization who either specialists in that area or integrate their peers in turn to ensure the right solution. Let’s realize that most successful partners are not one off “box” sellers but have built their Intellectual property, wrapped around services and ensured stickiness with the customer. It is time for vendors to realize the true value add that is brought by the channel including even at the Distributor level.

3.    New Customer Acquisition: It is all about coverage. Simple math tells you that one solitary salesperson in your direct team (however exceptional) cannot have the breadth and depth of coverage that is required either in a market or even an account. And let’s remember the age-old fact that new partners and new salespeople bring you new customers. Across my years of experience, I have witnessed customer acquisition and the lower costs, time to market and scale directly related to the strength of a vendor’s ecosystem and their ability to attract new channel partners. Customer acquisition and the cost thereof are often a key factor that PE/ VC companies or even Wall Street factor.

4.    Borderless Boundaries: The cloud while accelerating partner IP and thereby solutions has also impacted the geo a partner plays in. I call this “Borderless boundaries”. No more is a partner confined to a small set of customers or to a given Geo. Never have I witnessed channel geo expansion across Asia as we see today. It isn’t just the US or EU partners coming to where the action is, but Singapore based partners accelerating in ASEAN and partners from Australia and New Zealand expanding to even Vietnam. This has been a hallmark of successful partners though in a very, very planned way. That said, every market in Asia is unique and often times, partners look to the vendor to help. Leading vendors today have executed successfully with their partners on this front thereby increasing their share in each local market. This is a must do today for vendors to further increase partner stickiness and of course their revenues. If you don’t your competition will!

I do believe it is time to put to rest the debate of direct vs. the indirect model and take that calculated leap here and now. I am yet to see a downside, can you? And remember, there are no half measures: Either one is all in or not.

 Thank you for your attention. Do reach out to me at ananth@partnerplexus.com if you need further insights & help! Do visit us at https://partnerplexus.com

 At Partner Plexus, we maximize technology companies to rapidly build sustainable growth models in Asia Pacific by helping them to land, launch and scale in this region…through channel ecosystems.