Differentiate and distinguish.
That’s the message that Intelisys, one of the largest and most influential master telecommunications and cloud distribution companies, emphasized Wednesday at its annual Channel Connect networking conference underway this week in Napa, California.
At Channel Connect, where more than 100 agents and solutions providers are huddled for product briefing, strategy sessions and networking, Intelisys SVP Andrew Pryfogle told attendees Wednesday that two major developments are driving traditional agents to rethink their business strategy. First is the tens of thousands of VARs that are moving into what he called “the recurring revenue game” of selling voice and data solutions as a service. Second, Pryfogle added, is the increased competition and channel conflict that telecommunications providers have created.
“Every single carrier out there is teaching their sales people to sell to agents’ customers,” said Pryfogle. Their increased focus on midsize customers, combined with increased competition from data VARs, has made the telecom market, which has traditionally been served by the roughly 5,000 independent agents based in the U.S., a lot more crowded.
“That’s what I want you guys to get ready for — a period when how to differentiate yourself is about to get more important,” he said.
In panels and discussion that followed, Pryfogle and other market experts provided suggestions for how telecom agents can brace for increased competition. Pryfogle’s advice? Offer customers new thinking, especially as they rotate in a new CIO every two or so years.
“CXOs want you to step up and bring to them new ideas as opposed to simply giving them what they ask for,” he said. This includes presenting them with more than simple ideas for saving money. Agents and solution providers must offer new business insights, especially when it comes to moving applications out of the data center and into the cloud and onto mobile devices.
“You must be their go-to person because the pace of change is so much faster today,” Pryfogle said. “[Customers] use of technology six months from now is going to be different than today. It’s happening that quickly.”
In addition to dealing with complexity and change, he also spoke of the need to do so at a time of great demographic change. Millennials who were born between 1980 and the mid 1990s will become half of the workforce within the next decade or so. As “technology natives,” they will offer new insights and demands that will test business owners in new ways.
To combat the increased rate of change, the rise in complexity and the underlying demographic challenges, Pryfogle and others suggested that solution providers reposition themselves as technology general contractors — business advisors that can deliver a broad array of solutions without having to be masters in all areas of competency.
“When you build a house, you don’t need to know how to do everything to build it, but you do need to know when a plumber, electrician or more is needed. That’s one role that agents can play to thrive in the increasingly crowded market,” said Pryfogle.
While some experts advise solution providers to find an underserved niche, Pryfogle said agents should think in terms of broadening their capabilities.
“Imagine a wall around your customer. What services are you selling that customer? If you’re not selling them all the services they need, then you have giant, gaping holes on that wall — places where a competitor could enter and try and take that customer from you,” he said.
He went on to say that “cloud services” are gaping holes in the walls on many traditional agents who are focused on horizontal phone services.
Throughout Wednesday, others picked up on the general contractor idea.
Gary Testa, global vice president of cloud and service providers at Polycom, said partners can broaden their horizons by developing vertical-market expertise. He told a story on stage during a panel session about a business partner who sells exclusively to the medical community. The son of a physician, the agent has developed the ability to speak the language of the doctor’s office and enjoys a close rate that is well above the industry norm.
“With vertical specialization, you will protect yourself from all of the other players out there,” said Testa.
Jeffrey Pearl, vice president of carrier sales North America at Broadsoft, told attendees that they need to remember to sell “the future” to their customers, even though it might not translate into sales immediately. As a trusted advisor, be the first to introduce innovation and concepts to customers, he said.
“[Customers] may not buy today, but you have to pitch the future. If you’re their trusted advisor, they will call you back when they encounter an idea that you first introduced them too,” Pearl said.
Echoing the sentiment, Michael Cox, the national channel manager at Level 3 Communications, said becoming a general contractor means selling both the new and the concise.
“As a general contractor, bring a solution to the table,” he said. “Don’t force the customer into endless decisions.”