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Mass migration to the cloud is set to continue strongly into 2019, with Gartner predicting growth of 17.3% in public cloud services alone. Enterprises want to reduce costs, increase efficiency and reap the flexibility benefits that cloud offers – and this growing demand should be music to the ears of the channel.Content Continues Below
At the same time, channel businesses are keen to shift to a service-centric business model as their on-premise client base considers the cloud. Being able to offer a strong cloud portfolio – including backup, disaster recovery and compliance expertise – is a tantalising prospect.
If they can develop the appropriate expertise and find the right cloud service provider (CSP) to partner with, channel businesses can unlock the full cloud opportunity and build robust revenues for the future.
Building healthy, profitable channel/CSP relationships is going to be a priority for both parties as we start the calendar year. With that in mind, here are five tips for channel partners aiming to initiate successful CSP partnerships.
1. Align business goals
It may sound obvious, but understanding each other’s goals for a healthy channel/CSP relationship is essential.
Channel partners need a CSP that understands their customer’s priorities and supports their business ambitions – ideally offering specialist expertise in the sectors that they are targeting. CSPs are seeking partners that will commit to engaging closely with their service, investing in the relationship to effectively take it to market.
Defining the structure of the relationship early on is vital. iLand’s experience shows partners have differing requirements and preferred levels of investment when launching a cloud services strategy. For some, it is about earning recurring commissions with minimal involvement in end-to-end sales and support. Conversely, resellers often want to retain billing relationships, but also have assistance with the sales and support process from the cloud provider.
Managed service providers (MSPs) want full responsibility for the customer relationship, which includes billing, account management and support, and they want to profit from adding their own managed services offerings around the cloud service.
The flexible nature of cloud service provision means CSPs are capable of supporting all three approaches. So establishing clarity over ownership of the customer relationship, where responsibilities rest and how service-level agreements (SLAs) and support will be managed sets a positive, collaborative tone for the engagement.
2. Go-to-market strategy and customer onboarding
Make sure to ask probing questions around the CSP’s go-to-market strategy and its commitment to joint activity that will help you win new business. How will they improve your service capacity technically and commercially to put you ahead of the competition? What can they add that will enable you to go after bigger opportunities with confidence?
When customers opt for a cloud product, speed and simplicity of onboarding is crucial. Find out how your potential CSP will assist your teams in scoping out customer requirements. Cloud environments can be notoriously difficult to right-size, yet only paying for what you need is a core part of the customer value proposition.
Find out what tools the CSP can offer to help you get this right first time so that projects get profitably up and running. Iland offers channel partners the opportunity to use its unique Catalyst right-sizing tool on a white-label basis, effectively putting its expertise fully at its partner’s disposal. This removes the guesswork and enables the channel partner to build a plan that phases the customer into the cloud.
Once the projects are live, how will SLAs be set up and managed? Who will provide technical support and testing? For backup and disaster recovery, is continuous testing available? What’s the roadmap for value-added services that you can propose to the customer as the engagement continues? Your prospective CSP should be able to answer all of these and be willing to tailor their proposition to your business model.
3. Build profitable services with transparent pricing
Clear pricing with no hidden costs is a priority for customers. The waters have become muddied in the hyperscale space, where an estimated 500,000 line items make it hard for customers to optimise their deployment and understand what they’re paying for and why – leading to frustration for many.
It’s not just customers getting frustrated, either. I regularly hear that pricing is one of the most difficult things for MSPs to get right, but it really needn’t be.
CSPs should be offering partners full visibility of historical billing and accurate predictive billing so there are no nasty shocks in store and customers can confidently budget for their future needs. With guidance from their CSP, devising a profitable cloud business model ought to be straightforward.
4. Leverage CSP’s specialist expertise as your differentiator
If you’re offering cloud services, you’re going to encounter the complexities of compliance. Your customers will be wrestling with data privacy and security and will need reassurance that their cloud system investment meets the industry’s compliance requirements. This is particularly important for heavily regulated sectors such as finance and healthcare.
The truth is that it takes years of experience and continuous focus to keep up to date with the regulatory environment and it’s not something channel partners have the capacity to do. CSPs, such as iland, however, do this as a matter of course – it’s central to its proposition of delivering secure, compliant cloud.
If the CSP puts all of that compliance expertise at their partner‘s disposal, they can pursue markets that might previously have been considered too complex due to governance and security requirements. It becomes a powerful differentiator that the channel partner can take to market.
At iland, we have a dedicated compliance division with some of the most in-depth knowledge around making cloud work for highly regulated industries, and we help our partners to leverage that, putting them ahead of the competition.
5. Make sure you get advanced management and monitoring tools
Cloud environments are multi-faceted and visibility is vital for successful management and monitoring. You need a complete, centralised view over all your customers’ cloud services including disaster recovery as a service (DRaaS), infrastructure as a service (IaaS) and backup.
You want to be able to manage billing, performance, security, compliance, testing and reporting through a single pane of glass to provide superior customer service and create opportunities for additional revenue from value-added services in the testing and reporting space.
For channel partners aiming to strengthen their cloud service portfolio, it’s critical that CSPs – the experts in service-based models – provide robust and transparent support. This means clear pricing, straightforward SLAs, complete visibility of the cloud environment for ongoing management, and a commitment to making their expertise your differentiator so that you can build a successful, profitable partnership on both sides.
Get this right and the opportunity is huge for a successful and collaborative channel/CSP relationship.
Read more about CSPs
- Cloud service providers can reap a longer, more profitable life from their cloud platforms by taking advantage of the benefits of hyper-converged infrastructure.
- Red Hat, Microsoft and VMware all provide private cloud environments that offer security and compliance, but it’s important to consider other business needs, as well.