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Channel Partner Program Trends

Major shifts in the IT landscape, including the continued adoption of cloud-based solutions, are changing the industry in many ways, ushering in new business models, more diverse competition and non-traditional routes to market for technology. The impact on the IT channel has been significant, leading many channel firms down the path of business transformation to new models and markets. Vendors too are grappling with how best to serve a newly empowered customer via direct and indirect sales, cloud and on-premise solutions and other variables.

The pace and intensity of industry change, while exciting for many in the channel, has also resulted in a downside: Renewed incidence of much-bellyached channel conflict. Certainly not a new phenomenon, channel conflict nonetheless is increasing amidst today’s rapidly changing IT industry. CompTIA’s 3rd Annual State of Channel Study: Channel Conflict & Deal Registration Trends study found that 6 in 10 channel firms said that the incidence of channel conflict increased over the last two years, including 21% that said it rose significantly.

Conflict takes many forms: competition between a vendor’s direct sales force and its indirect channel partners, partner-to-partner conflict among channel firms aligned with the same vendor, or simply a lack of adherence to established rules of engagement in the field. The channel by definition resides smack in the middle of the IT delivery chain so it comes as no surprise that the many transformative market changes are having a profound effect on their business rules of the road.

Despite upheaval in the channel today, classic relationships between channel firms and vendors remain. Partner program participation – in terms of number -- held steady year over year, with roughly 7 in 10 channel firms reportedly enrolled in between 1 and 4 vendor programs. But as is always the case, the mix of partners the channel works with fluctuates as firms reevaluate relationships based on a wide variety of factors and then choose to either add new vendors to the mix or drop others based on what is or isn’t working. Nearly half (44%) reported a net gain in the number of partner programs they participated in last year, while 22% reported a net drop and 28% kept their mix of players the same.

The primary reasons cited for adding a new vendor in the last year included the ease of doing business and communicating with said vendor, the quality and availability of technical and business training, superior products to sell, quality leads and demand generation, and a program diverse enough to cover the needs of the wide variety of channel firm types in the market today.

CompTIA’s 3rd Annual State of Channel Study: Channel Conflict & Deal Registration Trends study was conducted in two parts. Part one was an online survey of 350 executives at US IT companies. Part two was a series of in-depth interviews with IT channel executives. Data collection occurred February – March 2013. The full report is available at no cost to CompTIA members. Visit CompTIA.org or contact research@comptia.org for details.