IT resellers need to be agile in a cloud-first market
With businesses accelerating their cloud and digital strategies in order to remain operational, IT value-added resellers (VARs) and consulting firms are also under pressure to reinvent themselves as cloud-first entities.
To do this, they must adopt new commercial models and sales practices, says PJ Bishop, VP: Services for Africa and Middle East at Sage.
Bishop says forward-thinking IT resellers started to position themselves in a market increasingly dominated by cloud and SaaS several years ago. The ones who had not started this transition before the pandemic found themselves needing to do so rapidly.
“Each reseller needs to relook its revenue models and skills to keep pace with the transition to the cloud. This will include expanding the focus beyond the initial sale to build customer value over a longer-term relationship and using metrics such as customer satisfaction and annual recurring revenue to measure performance,” says Bishop.
He adds that resellers will need to find new ways to add value and set themselves apart to regain the traditional revenues stream that were lost when software licence deals fell away and were replaced with recurring, subscription-based revenues.
“Ways they could set themselves apart in the market include building new products or services or collaborating with other organisations to deliver complementary offerings and skills.”
In the past, IT resellers depended heavily on face-to-face interactions to drive sales and customer experience. However, when social distancing and lockdowns drove buyers and sellers online, the customer journey in the B2B world became increasingly digital.
Moving support online
According to Bishop, resellers are moving more of their customer support and engagement online, and perfecting digital experiences should become a key focus. Resellers must become truly customer-centric, and they cannot do this without properly understanding their customers.
“It’s also about using data to understand what customers need and providing them with personalised, consistent experiences across multiple touchpoints and channels. Resellers should be visible through all digital channels, including search and social rather than only on legacy billboards, newspapers or at events.”
He says resellers are relevant in the cloud era because they are the human face of most vendors’ business, the first line of support, and an extended salesforce. Instead of cutting them out, the pivot to the cloud has created more opportunities for channel partners to add value. Sage, for one, still does most of its business through accountants, resellers and consulting partners.
Bringing the right skills
He believes that resellers have a critical role to play in the scale-up and mid-sized enterprise space, and organisations in these sectors are increasingly adopting technologies such as automation and analytics to grow.
To succeed in this segment, the channel needs to bring business consulting and technical skills to the party, because their customers want advice about digital transformation and enhancing their business process – plus the necessary competence to oversee implementation and integration.
Bishop says resellers need to keep assessing whether their value proposition is still valid for the customers they serve.
“They need to roll with the punches and take an agile approach to the go-to-market strategy. New ways of work and work-from-home policies are going to create different behaviours. Channel partners who listen to their customers and adopt a customer-centric approach, coupled with their agility to change the way they go to market, will thrive,” he ends.