The accountant, the marketeer and the lawyer: Meet your new competitors
Professional services firms are beginning to take a larger share of the tech budget, with over a third of MSPs and resellers now seeing marketing firms as competitors, CRN research confirms
The rise of shadow IT has thrust marketing agencies, accountants and legal firms firmly into the competitive landscape of traditional resellers and MSPs, research from CRN has confirmed.
Some 36 per cent of resellers and MSPs we questioned said they now regard digital marketing agencies as competitors to either a ‘fair' or ‘great' extent.
The equivalent figure for accountancies, legal firms and manufacturing firms stood at 20, 22 and 28 per cent, respectively.
The research, which quizzed 70 UK MSP and reseller execs, was conducted for CRN Essential's latest report on the shadow channel.
There are now "literally millions" of companies wrapped around the 65 per cent of the tech budget that now resides outside of the IT department, Jay McBain, principal analyst, Channel Partnerships & Alliances, at Forrester told CRN in the report.
CPAs (chartered pubilc accountants) in the US alone number 150,000 (compared with 162,000 VARs and MSPs), 81 per cent of which now play in tech services, and there are 108,000 digital marketing agencies, 78 per cent of which now also style themselves as tech players, McBain explained.
However, resellers and MSPs may be underestimating how much of the tech budget rivals in this "shadow channel" have bitten out, McBain said.
"Shadow IT partners] aren't calling on your buyer," McBain said.
"Many [traditional partners] don't know what they don't know. Shadow IT partners aren't trying to sell PCs, servers and managed services contracts to CIOs, CTOs, CDOs, CISOs."
"For the traditional partner, they sit there merrily - probably for a long period of time - thinking they've got everything and not realising they are losing the account," - Rod Baptie, Baptie & Co
Rod Baptie of Baptie & Co, warned against complacency when it comes to the rise of non-traditional partners.
"Before you know where you are, this partner has come in from nowhere, bypassed the CIO, bypassed all the existing relationships, and is beginning - piece by piece - to nibble away at the tech budget within the customer," he said. "For the traditional partner, they sit there merrily - probably for a long period of time - thinking they've got everything and not realising they are losing the account. We see it happening all over the place."
In the report, Kieran O'Connor, sales director at reseller Total Computers, said he was "very aware" of the growth in non-traditional partners.
"Accountancy firms, legal firms - those type of professional services organisations - are trying to now add technology to their stream of business. I don't see it too much outside those types of organisations. But do we see them going for the straightforward bids we're involved in? We've not seen any evidence of that yet."
Ben Hayes, director of MSP IP6net, added: "What we're seeing is that the accountant will have a conversation about Xero and it snowballs with the ecosystem around it from there. There are applications like Chaser, which does automated chasing of overdue invoices, and that stops with the accountant, but what other stuff is that then introducing to the customers?"
The report is available exclusively to CRN Essential subscribers here. It includes the full survey findings and indepth interviews from key players including McBain and Baptie, as well as leading UK channel players such as Softcat's Graeme Watt.
To view the abbreviated, free version, see here.
Also available on CRN Essential in 2019:
2019 Print Provider Report (or for related news article see here)
2019 Cybersecurity Provider Report (or for related news article see here)
DaaS Adoption Report (or for related news article see here)
2019 Staff and Salaries Report (or for related news article see here)