The newly released Global Technology Distribution Council (GTDC) report, Thriving in the New Normal: How Distribution Partnerships are Making a Difference in the Digital Era, examines the advances that distributors have made in the areas of cloud computing and digital services in the middle of the COVID-19 pandemic. Key findings from the GTDC and its research partners include:
1. The growth of cloud coincides with distributor investment.
The pandemic is driving the cloud into a position as the new normal. Worldwide spending on information technology in 2020 is expected to drop by 8 percent; however, spending on public cloud computing is expected to see growth by about 20 percent. From consumer entertainment to collaborative online work and meetings, cloud computing has proven to be instrumental for day-to-day life during a pandemic. Varied estimates suggest that up to 30 percent of the workforce will make work-from-home at least a part-time, if not a permanent, arrangement, even after the pandemic. This new model requires worker access to high-speed internet bandwidth, secure connections to business applications, and data recovery.
The interest in cloud computing has been accompanied by interest from investors. The stock market has seen record highs for shares in stock of companies such as collaboration and meeting software Zoom and electronic signature software DocuSign. Zoom, in particular, saw massive growth in use; in December of 2019, about 10 million people logged onto Zoom for meetings. But by the end of April 2020, more than 300 million people were using the platform.
2. SMBs cannot survive without digital innovation.
COVID-19 shutdowns put small businesses in dire straits, and their struggle to remain open has driven them toward digital innovation and cloud technology. SMBs are spending twice as much revenue by percentage than large enterprise companies on information and communications technology (ICT).
Many smaller businesses see technology as an equalizing force that allows them to compete with larger ones and know that their customers want the same experiences as they get from the digital spaces of large corporate entities. Even with physical locations closed, SMBs are able to remain open because of their ICT investments.
3. Tech professionals and line of business leaders need each other like never before.
Since the COVID-19 pandemic hit, tech spending by business managers has come under scrutiny. Dropbox, for example, stated that it would reevaluate where it spent money and prioritize the apps most-used by its workers. Business managers are learning the necessity of coordinating with their ICT fellows to avoid over-spending, adequately secure their organizations against cyber-threats, and comply with regulations. This is especially important in the age of Software as a Service (SaaS), as per employee, companies spend more on SaaS applications than on hardware such as laptops. With such complex software requirements, businesses need trusted IT advisors to help make those decisions.
4. Tech innovators cannot thrive alone, and no one brings complex technology together better than distributors.
The landscape for distributors is shifting. Once viewed with the primary function of moving hardware, distributors now facilitate cloud computing and digital services. Rather than attempting to manage all of its applications in-house — the total number of applications an average company uses can vary from 40 to more than 100 depending on company size — a technology company can partner with distributors that will manage their cloud subscriptions for them.
It’s common for technology startups to experience some difficulty taking their innovations to market or finding partners to help them. A smart strategy is to partner with distributors, even seeking their assistance early in product development. The support of a distributor partner can make the difference in reaching a wider market and growing your business.
Download GTDC’s report for more insights on how your distributor partners can help you sustain growth throughout the pandemic and beyond.