This year’s gold standard Comms Vision Convention (6th-8th November, Gleneagles Hotel) doubles down on the technology drivers transforming the channel’s portfolios alongside how go-to-market (GTM) and revenue models are evolving – and what this all means for the channel’s strategic planning. Here, Giacom CEO Terry O’Brien (pictured right) and COO Nathan Marke (pictured lefty) – Comms Vision Platinum sponsor – set out the success factors that will help drive long-term growth for MSPs as ICT buying agendas become dominated by security, professional and managed services, infrastructure and applications, all underpinned by a desire to leverage cloud and remote IT services.
Getting to grips with SMB technology priorities and ICT purchasing trends will enable MSPs to make the right strategic decisions and steer a course through transformational times. According to the latest research from Analysys Mason, UK SMBs’ spending on IT is returning to pre-pandemic growth levels with a projected CAGR of 5.6 per cent between 2023 and 2028. Within this, spending on cloud categories alone is expected to grow at a CAGR of 9.6 per cent. The research also shows that SMBs are adopting a more holistic outlook towards technology with cybersecurity, IT, managed services and infrastructure positioned as their top focus areas. These priorities contrast with pre-2020 when the emphasis was more on devices and peripherals as well as comms and collaboration tools.
Over the coming years end user tech requirements will evolve towards more sophisticated cloud and AI solutions with a strong emphasis on cybersecurity
That cybersecurity has emerged as the number one priority for SMBs should come as no surprise, emphasising the growing importance of safeguarding digital assets against increasing cyber threats. This is followed closely by IT and managed services which provide essential support and expertise for implementing and maintaining new technology, allowing SMBs to focus on core business activities with minimal disruption.
Key investments
Continuous investments in remote IT, infrastructure and cloud services have also become indispensable for SMBs, ensuring robust and scalable systems that can support business operations efficiently. Additionally, although SMBs have been somewhat late to the party in investing in software, business applications are now a major focus, enabling organisations to streamline processes and enhance productivity.
Over the coming years end user tech requirements will evolve towards more sophisticated cloud and AI solutions, with a continuing emphasis on cybersecurity. The expansion of hybrid workforces and cloud-hosted resources, coupled with the rise in cyber threats, means that traditional security methods are no longer enough. SMBs are taking cybersecurity more seriously and developing comprehensive security strategies that require a high level of expertise to implement and maintain. As a result, we’ll see an increasing demand for integrating various security solutions, including data protection, endpoint security, network defences, web and email security, mobile security and EDR/XDR.
Furthermore, spending on Gen AI will increase exponentially with every software vendor tying their offerings into one or more of the Large Language Model ecosystems to enable faster and better automation. It’s crucial to integrate Gen AI with existing systems in a controlled environment, with ongoing testing and monitoring to prevent misuse, ensure information security and compliance with relevant regulations.
As a result, SMBs are increasingly adopting a more mature technology outlook, recognising the need to move away from fragmented purchasing. Instead, they are seeking strategic partners to cohesively manage their entire technology estate on an ongoing basis. As ICT buyers focus on cybersecurity, cloud services and managed IT services, the complexity of the technology landscape continues to grow. SMBs are no longer just looking for products, they require strategic partners that can provide continuous expert guidance, helping them navigate, optimise and harmonise their technology solutions. This trend signals that the channel must pivot towards offering comprehensive managed services and cloud-based solutions to remain competitive and drive revenue growth. It’s what I’ve been calling ‘The rise of the MSP’, with market data showing MSPs growing at more than 3 x the rate of traditional resellers.
While channel providers are pivotal in educating and enabling SMBs to manage these complexities, they themselves often face significant challenges, needing to go broader and deeper with their capabilities in an era of acute skills shortages. These shortages can limit their ability to expand service offerings and meet evolving customer demands effectively. To address these challenges, suppliers to MSPs must step up and provide targeted support beyond traditional training and product updates. A hands-on approach is essential, with continuous engagement and practical tools that enable partners not only to understand but also to effectively implement and leverage new technologies.
Our growth accelerator packages exemplify this approach by helping partners identify significant opportunities within their customer bases, providing an end to end new service onboarding process, from identifying opportunities in an MSPs customer base, all the way through to enabling them to win, deliver and grow. Furthermore, vendors that provide sophisticated platforms that integrate with an MSP’s own systems, automating services from lead to cash and offering extensive, intuitive provisioning portals will significantly empower MSPs to adopt and integrate new products and services with greater ease.
Emerging technologies
Many conversations with buyers are initiated and driven by emerging technologies, largely due to their innovative capabilities and their potential to address new and evolving business challenges. The curiosity and focus on these technologies stems from their novelty and the promising advantages they bring to the table. They’re an unknown quantity, which naturally captures the attention of buyers.
While emerging technologies like AI, IoT and cloud solutions may capture the imagination of IT buyers, it’s important to recognise that mature products and services continue to play a fundamental role. These established technologies are critical, underpinning the foundations for other technology solutions. For example, robust connectivity is a prerequisite for the effective deployment of exciting new cloud and IoT solutions. So, the transformation in business and industry is not solely driven by emerging technologies, there’s a blend where new technologies build upon and enhance the capabilities of existing infrastructures.
A big topic of conversation for us with MSPs currently is encouraging them to consider offering their customers telco services. While these services are utility, being offered from the same supplier as part of a wider subscription service makes life more simple for an SMB and can be margin rich for an MSP.
MSPs must always be ready, willing and able to embrace emerging technologies to stay competitive and meet the demands of their clients. A proactive approach is essential not only for maintaining relevance but also for driving business growth. Investing in ongoing education and training is essential for building expertise in emerging technologies such as AI, advanced cybersecurity and cloud solutions. A comprehensive understanding of these areas will enable MSPs to offer more services and advice to their clients while ensuring successful implementations and increased profitability.
Strategic partnerships
Forming strategic partnerships with suppliers that are leading in these emerging fields will also provide MSPs with valuable guidance, additional training resources and access to the latest tools and knowledge bases. Good suppliers will also enable MSP partners with white-labelled marketing materials, versatile provisioning portals and complementary service offerings.
Against this backdrop of industry change and innovation, it is important for MSPs to review their tech stack and roadmaps, and reassess partnering strategies. MSPs must continually ensure that their offerings align with both current and future market demands. By regularly reviewing their tech stack, MSPs can deliver relevant, scalable and secure solutions to their clients.
Equally important is the review of partnerships. Collaborating with suppliers that offer a rich and varied portfolio of products and services, alongside enablement programmes that prioritise robust training, marketing support, and access to advanced procurement systems, will allow MSPs to maintain their competitive edge and deliver greater value to customers. This approach not only drives growth but also enables MSPs to remain agile, bringing products to market quickly and with minimal friction.
By positioning themselves as a strategic partner, MSPs can help businesses focus on their core activities while ensuring their technology solutions run smoothly and efficiently. This approach not only strengthens customer relationships but also creates a sustainable, long-term recurring revenue model for MSPs, making their businesses more valuable in the process.
Giacom outlines four winning strategies for MSPs that will make a competitive difference
Giacom believes there are four interconnected success factors that enable MSPs to drive differentiation...
1. Simplify your offering: SMBs don’t need to know that there are 10 different ways with ten different vendors to secure their email. Choose the product that’s right for you and make a recommendation to them as their trusted advisor. And don’t compromise on this offering by customising your solution to the demands of individual customers. It will enable you to deliver a far more effective service to your customer and save you lots of money.
2. Deliver everything as a service: SMBs want simplicity in everything. Build a subscription stack for your customers built from common components across all of your clients. You will find that this delivers you significantly improved margins as customers are less likely to pick apart costs for individual components – if you like, this is a ‘stickiness premium’.
3. Automate, automate, automate: Spend as much time working ‘on’ your business as ‘in’ your business. Seek to automate everything you do by thinking of your own tech stack as a platform, as the core product in your offering to your customers. Taking this approach unlocks the dream ticket of ‘operating leverage’ where the bigger you get, the more profitable you get.
4. Never forget that people buy from people: In an era of incredible technology innovation, it is easy to forget that the most important component of your differentiation is your people. An incredible team that your customer loves working with will always beat a super smart, but ultimately faceless platform offering.
More priority areas for MSPs to focus on...
With cybersecurity at the top of ICT buyers’ agendas, MSPs must prioritise the integration of advanced security solutions. This includes offering multi-layered defences such as network and endpoint security, AI-driven threat detection and data protection. MSPs should also explore AI-powered solutions to drive operational efficiencies for their clients as this will be a key consideration for buyers in the coming years. This includes leveraging AI for process automation, predictive analytics and customer service enhancements, enabling businesses to operate more effectively. Partnering with an MSSP specialist that provides XDR (Extended Detection and Response) services that create real value out of an SMB’s investment in cybersecurity software is an essential component of any MSP’s toolkit moving forwards.
It’s not just about what you offer, but how you deliver it. SMBs are increasingly looking for a single strategic partner with a full range of managed ICT services, including IT support, remote monitoring and infrastructure management, ideally through a simple, predictable monthly fee per employee.
About Comms Vision
Comms Vision is the leading annual leadership forum for CEO, MD and CTO delegates making up the major league of the UK MSP community. To find out more visit www.commsvision.com