Channel partners have started moving up the value chain. In today’s business scenario the customer is not looking for a ‘box-pusher’, they need partners who can help them manage and consolidate their infrastructure and address their pain points cost effectively. The channel market is increasingly getting focused on delivering value-added services.
Channel partners have started evaluating business opportunities based on three parameters – How to increase share of wallet in the existing markets, how to expand to new markets and how to keep costs under control. They have started focusing on offering innovative solutions to grow their business by increasing share of wallet from the existing customers and strengthening engagement levels with them. We strongly encourage our partners to consistently revitalize their solutions portfolio by adding new innovative and cutting edge products in sync with the evolving market needs. There is also a trend of strong vertical focus in the channel market, some of the channel markets understand the needs of particular vertical have developed a solution portfolio and services and skills to cater to the vertical. There is also a trend to increase bottom line by strengthening engagement level with the customer; partners are realizing the fact that it is easier to sell to an existing customer rather than acquiring a new customer. Therefore, the focus is to have depth in the solution portfolio.
The channel community is also realizing the importance of having strong marketing campaign. Some of the vendors have also started providing co-op funds for their channel partners; these are dedicated funds for channel partners who can use these funds to complement their existing investment for marketing activities.
Going forward, the focus would also be to offer consulting services to the customers. The channel partners are closer to the customer and are in a better position to consult. However, they need to focus on building the skill-sets to move up the value chain.
In terms of emerging market opportunities, the SMB market segment will be a key market opportunity area for channel partners. According to analysts India is one of the fastest growing mid tier markets in Asia Pacific. As per a study done by Access Market International (AMI), there are nearly 7.6 million SMBs in India. The SMBs were set to spend $7.7 billion to beef up their IT infrastructure, up 26 per cent from 2005. According to NASSCOM, Small & Medium Businesses represent the next wave of growth in IT services in India and comprise a large and growing market, with an estimated 7.4 million SMBs expected to spend in the region of $17.5 billion on IT & Telecom in 2006 itself. EMC estimates that the SMBs are likely to increase their IT spend going forward.
Technology is evolving every day and partners need to keep up to the pace of technology evolution by continuously acquiring skill-sets. A lot of partners have started demanding for a strong training roadmap for their employees. The vendors are also realizing the need for skill-sets among partners and are now providing the channel partners with a training roadmap to skill the channel workforce.
However, there is also a shortage of skilled professionals in the industry especially domain expertise such as storage and security e.g. EMC estimates that there will be a requirement of two million storage skilled professionals in India by 2010. The channel industry needs these domain experts to serve their customer needs. Realizing this need in the information management and storage domain, EMC had launched an education program - EMC Academy Program (EAP), the program is aimed at developing a resource pool of skilled storage professionals. These storage professionals could then be absorbed by the industry and contribute to the growth of the industry.
As per Nasscom, the Indian domestic IT market is expected to exceed $15.9 billion in fiscal 2006-07 recording a 21 per cent growth. Considering the tremendous opportunity the booming IT industry presents, the future looks bright for the channel industry.
Moving up the value chain : By Manoj Chugh President, EMC India & SAARC
