When analysts need therapists
Being contrarian is one thing but business strategies should always come down to what the customer needsPrint
5 October 2017 | 0
Regular readers of this column (it’s okay I won’t tell anyone) will know that I have always believed the channel has a role to play despite the different generations of doom-mongers and naysayers predicting its demise over the years.
So I was gratified to hear Steve Brazier, president & CEO at Canalys, tell the audience at the Canalys Channels Forum in Venice that “there are more opportunities for the channel now than there have ever been and we face a very bright future”. I was a bit puzzled when he claimed that journalists had been writing articles about “does the channel have a future?” for the past 20 years and they had “always been wrong”. Most of the people that I’ve heard pontificating over whether the channel has a future over the past 20 years have tended to be, well not to put too fine a point on it, analysts. Usually analysts trying to be controversial.
Anyway, the good news is that there are all types of opportunities for partners going forward and the European channel “is doing well” with channel partners growing by 7% in the first half of the year and distributors growing 4%.
Brazier acknowledged that some parts of channel partners’ business was in decline, “but there are many other areas you are growing” such as security and wireless. The PC market was also doing “surprisingly well” with the price of PCs increasing (and margins too). “Whoever told you selling hardware was dead is completely wrong,” he said. “The PC is suddenly the most profitable part of your business again.” He predicted that hardware would be 50% venue for 90% of partners in the audience until 2020.
There were some interesting observations on some vendors’ current obsession with digital transformation. “This has been the year where the vendors have been preaching digital transformation to you,” he noted. “I’m sure you have been told you need to change the way you engage with customers and invest more in digital marketing and retrain your salesforce. You’ve probably been frustrated because the vendors seem to say different things to each other… and their interest often seems to be self-interest in what is best for them.”
He urged partners to “let your customers decide where you should go. Listening to your customers is more important than listening to analysts. Stay close to your customers, that is what will take you forward. The channel has had the same purpose for the last 20 years. You provide technology to small and medium businesses typically, as long as you keep focused on providing the right technologies to small and medium businesses, we think you will do very well.”
The point about partners listening to customers is very important. Although the resell technology and have role to play in promoting technology to customers, their main job is to listen to customers and help identify what they need the technology to do. Staying close to customers comes back to what he was saying about the long-running questions over the channel’s role. Too often, people are inclined to believe that technology is a threat to that role rather than the enabler. Put as simply as possible, any changes you make to technology might have an effect on how a partner delivers technology to a customer, but they probably don’t alter the bedrock of the relationship between partner and customer.
In any case, the vendor’s agenda for technology is not usually the same as for the customer. The partner plays a crucial role in providing the technology solution and service that is most appropriate for the customer’s business rather than for the vendor. It’s why the customer trusts the partner. It’s also why vendors employ partners. Partners are realists – they take products and give them a reality for many customers that the vendors could never deliver themselves.