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2018 Is a Year of Revenue Growth for Tech Vendors Selling Product Through Tech Distribution
The vast and rapid growth in technology innovation has transformed the way tech vendors and tech distribution conduct business. After surveying 50+ technology channel executives, the 2018 Global Technology Distribution Council (GTDC) reports that more than 70% of vendors expect a double-digit revenue growth through distribution in 2018 compared to 55% in the prior year. The tech distribution growth is accredited to the distributors’ continual investment in new services, solutions, technologies, and programs.
Over the years, vendors have come to realize the scope of influence, capabilities, and efficiency distributors possess over small and medium-size markets. Consequently, vendors are heavily relying on distributors to grow their market share as well as the recruitment of new partners for their technologies and solutions. The GTDC’s 2018 Tech Distribution Outlook reports that vendors prioritize the recruitment of new solution providers as their main objective when partnering with distributors.
In order to survive in their sector, tech vendors are aggressively grasping for the newest and most effective ways to make conducting business in the ever convoluted channel easier for distributors. (“Vendor partners ‘get this’ and are finding dynamic new ways to work with distributors in addressing increasingly complex channel and end customer requirements”).
Vendors have always sought solutions to make use of their product or services easier for the end-users. The end-users’ increasing demand for instantaneous access to networks of information via the cloud has coerced the IT industry to extend its growth in cloud, security, data center, and IoT to support the end-customers’ requirements.
Technologies that Will Help Drive Tech Vendor and Tech Distribution Growth
Cloud and Cloud Related Services
The accelerated move towards cloud infrastructure adoption has spurred many businesses to turn to cloud service and software as a service provider (SaaS) for new solutions evaluation.
Since the introduction of the concept by Google CEO Eric Schmidt in 2006, cloud technologies have become an enormous revenue generating source for tech vendors and cloud service providers. Cloud computing is now a fully recognized, feasible, and cost-effective technology solution for all businesses.
The 2018 GTDC report states that after partner recruitment, cloud-related services are expected to be a major area of growth for vendors through their tech distributors. (This year, cloud-related services also ranked second among distributor offerings that vendors expect to grow the most in 2018, trailing only partner recruitment.
The total global public cloud market will be $178B in 2018, up from $146B in 2017, and will continue to grow at a 22% compound annual growth rate.
The global forecast for the size of public cloud computing market from 2008 to 2020 (in billion U.S. dollars)
Cloud computing offers both public and private sectors a convenient and flexible way of managing data and tasks. Lower operational costs, accessibility, mobility, the ease and speed of implementing and integration have all accelerated the movement towards cloud adoption. However, since it’s introduction to the IT industry, the security of data has been the top concern for many large and small organizations.
It’s important to note that the physical location of your data plays a much smaller factor in its security than the means of accessing that data. So, the data stored behind a Firewall needs just as much security as if stored in the cloud. Nevertheless, the introduction and popularity of IoT devices have made the need for a robust cloud security a prominent issue in the IT industry.
The Cloud Security Alliance (CSA) is a great source for learning the best practices for a secure cloud storage environment. The organization also offers experts’ advice and tips for preventing cloud security breaches.
As cloud security threats are materializing in the headlines, businesses need to develop and implement a security breach plan for during and after an attack. These days, IT vendors and distributors are encouraged to comply with known and applicable security practices. In order to stay ahead of any security breaches, it is in your advantage to know your security provider and the scope of their services.
Cloud computing and services have created an imposing crater in the IT industry landscape that continues to deepen. The solution is now one of the fastest growing industries worldwide.
75% of distributors cite security as the most active category for new vendor partnerships.
Source: 2017 Distributors and Cybersecurity Report ©GTDC
The global forecast for cloud security revenue from 2014 to 2020 (in billion U.S. dollars)
Internet of Things (IoT)
IoT, according to GTDC’s 2018 Tech Distribution Outlook, is the 3rd area in which distributors will make the most progress in 2018. The report states IoTs continue to develop in the channel, with distributors increasing drive for signing IoT-focused vendors.
As SaaS providers look into ways to take advantage of the boom in IoT, vendors are searching for SBM opportunities in order to capitalize on the IoT movement (IoT vendors look to capitalize on the SMB opportunity). Meanwhile, IoT distributors are ahead of the curve by having invested millions of dollars in solutions, expertise, tools, and services to help bring vendors and other partners together that specialize in IoT technologies (Many electronics distributors are counting on the Internet of Things (IoT) to boost sales over the next several years by attracting new customers and increasing business with existing ones).
The effectiveness, instantaneous, and mobile functionality of IoTs are just a few features that make these cloud base devices a centerpiece of the IT industry. With a forecasted 20-30 billion units in use by 2020, IoTs are considered to be making a significant impact on the It market and society as a whole.
By 2020 the number of IoT devices is expected to reach 50 billion and $19 trillion is anticipated as cost-savings and profits from this investment.
The overall Internet of Things market is projected to be worth more than one billion U.S. dollars annually from 2017 onwards.
The global forecast for the number of connected devices (Internet of Things; IoT) from 2015 to 2025 (in billion U.S. dollars)
The concept of Hyper-convergence is growing at a rapid pace. The increase in data traffic, demand for cloud services, and expense of on-premise data storage have contributed to the growth of data centers and its evolvement to hyper-convergence infrastructure.
Hyper-convergence basically offers users the benefits of cloud storage with the security and control of on-premise software. For a vendor and their channel partners, hyper-convergence systems streamline their data management procedures by combining server and storage resources with channel software in a scalable channel management, sales or marketing software. OR – For a vendor and their channel partners, hyper-convergence allows the creation of a preconfigured centralized channel management and storage system in a form of a scalable modular solution.
(Hyper-converged infrastructure streamlines the deployment, management, and scaling of datacenter resources by combining x86-based server and storage resources with intelligent software in a turnkey software-defined solution. Separate servers, storage networks, and storage arrays can be replaced with a single hyper-converged solution to create an agile datacenter that easily scales with your business.)
The hyper-converged infrastructure market is expected to reach USD 12,607.4 Million by 2022, at a CAGR of 43.59% between 2016 and 2022.
The global forecast for hyper-convergence revenue from 2015 to 2025 (in billions)
Meeting the Demands
With more than 70% of businesses today relying on indirect sales channels to capture market share, most sales, marketing, finance, and operations departments need timely and accurate channel POS and inventory data to make key management decisions.
For customers needing modular solutions, CMR’s self-service software provides unmatched flexibility and scalability. This allows customers to build the most optimized platform to manage their channel.
Customers around the world rely on CMR’s suite of channel management applications and industry expertise:
Partner Portal: Your suite of channel management applications from Deal Registration, Co-op/MDF Management, Reseller Profiles, Special Pricing Requests and more
Channel POS: Our flagship product that streamlines the collection and processing of point-of-sales records into comprehensive reports
Channel Inventory: Application to help you monitor price protection and inventory levels
Other Customized Channel Software: We can build a channel management application custom-made for your business