The last 12 months, accelerated by the coronavirus pandemic, have brought significant challenges and opportunities for IT Distributors. A recent Forrester report has highlighted these issues1, and we agree that, despite some difficulties, IT Distributors have access to straightforward methods to improve their offerings to customers. We know that Configure Price Quote (CPQ) services, data services, and product management have a significant role in improving user experience and competitive edge in IT Distribution.
The challenges:
- There has been a rapid shift to digital transactions. Some Distributors were already ready for digital selling; others have tried to transform quickly.
- B2B buyer behaviour is increasingly becoming similar to B2C buyer behaviour, expecting an independent, self-service and digital customer journey.
- Vendors are investing in direct-to-customer (D2C) models, building more robust and more direct relationships with partners to influence and improve customer journeys.
- Revenue growth for traditional IT distributors is flat.
- Legacy hardware, software and services which are acquired through distribution is low performing.
“Traditional IT distribution is not structured to offer this [subscription] consumption model across the channel, and businesses served by the indirect channel show no signs of reversing their preferences and going back to bespoke CAPEX solutions.”1
The opportunities:
- Recurring revenue business models ‘–as-a-service’. Distributors need to deploy tech and form an ecosystem to facilitate a recurring-revenue business model based on customer loyalty and enabled by data.
- More Data available to customers and post-sale engagement will increase the value Distributors can offer.
- The convenience of marketplaces for B2B buyers as their behaviour emulates B2C buyers. Distributors need to create a user-friendly marketplace strategy, ultilizing CPQ tools, as customers reach for alternatives to a vendor-specific webstore.
It has never been a better time for Distributors to add value operating and transacting with their partners and customers.
Find out how channelcentral supports IT Distributors with CPQ and data services to build the ecosystem for their go-to-market needs:
As-a-service https://www.channelcentral.net/daas.asp
Marketplaces https://www.channelcentral.net/marketplace-hosting.asp
1 Forrester report, The Future of Distribution, Joe Cicman and Jay McBain, February 23, 2021.
Watch the summary video here:
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