From The Expert Feature Article
April 03, 2013

Forrester: Cloud and SaaS Best Sold by Partners That Add Management

A new study by Forrester (News - Alert) Research shows that partners are critical to the successful sales and deployment of cloud and software as a service (SaaS) products.

The study was commissioned by Avangate, a seven-year-old Amsterdam-based provider of agile commerce solutions to support services companies.

In the Forrester Technology Adoption Profile (TAP), 66 percent of respondents said that partners were important in building more revenue from SaaS (News - Alert) offerings.

"As both selling online and cloud-based services have become ubiquitous, a common misconception is that the value of having channel resellers falls," said Michael Ni, CMO/SVP, Marketing and Products, Avangate. "The reality is that in a world of easy discoverability, reseller channels actually drive the trust, context and value-added services that ultimately sustain revenue growth. The results of this Forrester Consulting survey illustrate how channels are actually more important than ever in today's highly competitive market.”   

Now that the cloud is more mature and understood, IT is changing the way it buys. "More than one-quarter of firms are centralizing the procurement and management of SaaS cloud applications. Consequently, these firms are changing their sourcing strategy, looking to solution partners who can supply and centrally manage the entire end-to-end SaaS portfolio," the report said.

To exploit this trend, cloud providers need to adapt. "To ensure the continued growth and long-term sustainability of the partner channel, ISVs must invest in new technology to ensure that partners are equipped to self-serve their own customers and build long-term relationships," Forrester argued.

The cloud may be a challenge for vendors who must master the channel, but it is also a challenge for the channel which must master the cloud. That’s according to a white paper from Techaisle, “Cloud Computing Challenges the Channel.”

With on-premises wares, the IT vendor generally sells to a master distributor, who sells to a VAR, who sells to the IT customer. With the cloud, there is no real need for a traditional distributor, nor are all services handled by VARs. The challenge for VARs is to figure out how to truly add value to services that are often already managed and turnkey.

And since many shops buy an array of cloud services, the notion of a cloud aggregator is becoming popular, a reseller than can help IT acquire and deploy an array of services.

Avangate offers service providers and software houses a “scalable and integrated solution [that] includes a full-featured, modular and secure e-commerce platform, a partner order and revenue management system, as well as a constantly expanding worldwide affiliate network.”

Edited by Rory J. Thompson