The Role of IT Distributors in SaaS
The #SaaS market is growing rapidly and IT distributors are playing an increasingly important role in its success. Think of distributors as aggregators of demand or reseller to resellers. Distributors help SaaS vendors and their ecosystem reach a wider audience, provide technical support, and offer other value-added services. Traditionally IT distribution has been a very people and capital heavy business. SaaS is changing this and newer models are evolving even in distribution (e.g: Marketplaces. We will speak about Marketplaces in depth in another episode).
How IT Distributors Help SaaS Vendors
IT distributors can help SaaS vendors in a number of ways, including:
- Reaching a wider audience: Distributors have established relationships with a wide range of resellers, VARs, and other channel partners. This allows SaaS vendors to reach a wider audience than they could on their own.
- Providing technical support: Distributors can provide technical support to SaaS customers, freeing up the vendor's resources to focus on product development and marketing.
- Offering value-added services: Distributors can offer a variety of value-added services to SaaS customers, such as training, implementation, and consulting.
- Reduced costs: Distributors can help SaaS vendors reduce their costs by providing technical support and other value-added services.
- Improved efficiency: Distributors can help SaaS vendors improve their efficiency by handling the day-to-day operations of selling and supporting their products.
- Enhanced customer experience: Distributors can help SaaS vendors enhance the customer experience by providing a single point of contact for all sales and support needs.
Choosing the Right IT Distributor
When choosing an IT distributor for SaaS, there are a few factors to consider, including:
- Experience: The biggest asset with a distributor is their experience in the market. SaaS companies should use this to their advantage. Leverage the vast reseller network and everything which comes with that (scale, depth of relationships, credit etc). You will never reach the scale of a distributor on your own so utilize their scale and their relationships to build the business.
- Capabilities: Days of pureplay distribution and over and distributors know that too. The term value added distributor summarizes this movement from traditional distribution to value added distribution. These days distributors help not just in scaling out but in areas which were hitherto reserved for services companies(e.g: managed services). Whoever you choose should have the capabilities to meet the needs of the SaaS vendor on multiple areas.
- Size and scale come with tradeoffs: This is often missed while scurrying for a new distribution relationship. Not every distributor is a right fit for your product. A very large distribution house may not give enough attention your product needs in the early days. Similarly a smaller set up may not be able to do justice to the scale you are looking for. You need to decide what suits your needs at your current scale and as u grow.
Choosing the right distributor can be one of the most important GTM decisions you can make in the lifecycle of your journey as a SaaS provider.