Automated Digital Sales Set to Grab Indirect Revenue From Channel

… Automated digital sales (ADS) are set to be vendors’ second- and third-highest source of indirect revenue over the next five years, according to the latest research by The 2112 Group.

ADS – defined by the analyst as a “burgeoning channel segment” in which commercial and consumer purchasers select and buy products with no to little human interaction – is set to cause notable disruption to the channel as it becomes a “primary source” of indirect revenue for vendors, the research finds.

However, there is also opportunity for channel partners who can deliver professional, managed and integration services, the report, Strategies for Engaging Automated Digital Sales Channels, notes.

“ADS channels will not completely replace existing channels,” Lawrence M. Walsh, CEO and chief analyst of The 2112 Group, said in a statement released with the findings. “The complexity of certain technologies and sales will continue to necessitate partner involvement, but we believe sales of less-complex and commoditized products will transition to ADS channels.”

Of note for channel partners, the report points out that in The 2112 Group’s 2018 Channel Chief Outlook report 11 percent of channel executives said that marketplaces like Amazon are set to lead their indirect revenue by 2023. This sits behind MSPs at 39 percent, systems integrators at 17 percent and VARs at 17 percent. Significantly, marketplace revenue is predicted to be a higher revenue source by 2023 than master agents (six percent), DMRs/LARs (six percent) and ISVs (three percent).

“The day is coming when products and services that don’t require human sales and interaction will flow only through automated digital sales channels,” the report warns. “Digital sales aren’t simple or automatic. Implementing a digital sales channel doesn’t create new, incremental revenue; rather, it replaces declining revenue from existing channels.” …

Written by Jessica Meek

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