AWS Marketplace boss: 'We've giving channel partners a greater lever for growth'

New head of AWS Marketplace Stephan Orban says more than 500 channel partners are now using the platform

More than 500 channel partners are now using AWS Marketplace, claims it's newly appointed head Stephen Orban, who says the platform is enabling channel partners to achieve greater growth potential.

The AWS exec took on the top role at AWS Marketplace today, after previously leading the public cloud giant's Data Exchange business.

Speaking to CRN, Orban said that AWS is now working with more than 500 channel partners on its marketplace, claiming that the platform is helping to drive long-term growth for the channel.

He said that over the past year, AWS Marketplace has grown to include more than 1,600 ISV partners across 50 technology categories ranging from cybersecurity and networking to data analytics and machine learning. There are now more than 10,000 subscribe-able listings, across those 50 categories, Orban added.

The new AWS Marketplace boss said the platform now has more than 310,000 active customers, up from 290,000 revealed at AWS re:Invent last year, and more than two million active customer subscriptions.

The rise of marketplaces in general has been tipped by analysts to accelerate even more dramatically as customers hasten their shift to the cloud amid the Covid pandemic.

Forrester analyst Jay McBain revised his prediction at the beginning of this year that around 17 per cent of the $13tn in B2B IT spend will flow through marketplaces by 2023 to instead forecast that marketplaces could reach that figure as soon as this year.

But McBain goes on to suggest that the growth in marketplaces could create some obstacles for partners in getting in front of customers.

"A perfect storm of better technology and full-service buyer tools, shifts in buyer psychology and behaviours, savvier sellers, and growth of product-led growth (PLG), direct-to-customer (DTC), and marketplaces across more product categories will complicate channel partners' ability to get in front of the buyer early and lock in their value for the long term," he said.

But AWS' Orban contests that AWS Marketplace has become more complementary to channel partners and MSPs as it has evolved its catalogue and added more features.

AWS was the first cloud infrastructure marketplace to launch a "private offers" feature, in 2017, which allows customers and ISVs to negotiate terms and pricing through the platform, Orban said. This was expanded in 2018 to include "channel partner private offers" which enabled resellers and MSPs to partner with ISVs and add their own value on top of customer deals.

Orban added that these developments have led to a massive uptick in business on the AWS Marketplace platform.

"It is disruptive in the sense that we're building automation to help both ISVs and channel partners reach customers as they're migrating to the cloud, but doing so at a greater scale.

"So if anything, I think we're giving channel partners and ISVs a greater lever for growth. And it's good for ISVs in particular who want to add new channel partners; we have more than 500 channel partners who we work with today and we're often pairing up some of these channel partners with ISVs in ways and combinations that haven't been done before, and we're happy to continue to do that," he said.

Orban pointed to two vendors in particular - CrowdStrike and Snowflake - that have benefitted from the private offers feature on AWS Marketplace.

He said that Crowdstrike had quoted on an investor call that its business on AWS Marketplace had grown by 650 per cent and its deals are closing 50 per cent faster.

Meanwhile Snowflake quoted in a study that it's getting a 405 per cent return on equity from its investment in marketplace.

One AWS partner - Lemongrass - claims it has seen huge benefits from transacting on the AWS Marketplace.

The SAP and premier AWS partner was an early adopter of AWS Marketplace, according to its chief innovation officer Ben Lingwood.

The firm claims to have migrated more SAP workloads than any other AWS partner.

Lingwood said that Lemongrass has begun getting bullish with telling its vendor partners that they need to transact via the AWS Marketplace or they will lose out on business.

"I've got customers saying they don't want to buy in any other way. They don't want any other vendor agreements, they just want to come through the marketplace mechanism," he said.

"I get many discounts through the marketplace which makes us more sticky and competitive. I can take that 10, 20 or 30 per cent discount through the marketplace and then I can either choose to pass that through to the customer or I could split the difference and, say, give them 10 per cent discount and keep 10 per cent as margin that boosts my P&L."

The Lemongras CIO, however, added that the marketplace means that Lemongrass no longer needs to "run the gauntlet" with value-added resellers in order to buy software from multiple vendors.

"That's never a smooth selling process. Value-added resellers are looking for long-term agreements, they're looking for margins, they're looking for their own paperwork or processes that they need to sign off. And that changes region by region within organisations. So that, to be honest, can be a massive pain.

"So one of the things that the marketplace does bring is simplicity in bringing all my vendors into one common commercial framework, one way of working, so they're all bound by the Amazon Marketplace commercial framework way of working. And I feel like that's the way I would want to work, so that to me is very efficient."

Lingwood said that AWS introducing consulting offering to its marketplace is a "very interesting" move that will enable Lemongrass to carry out migration projects or large change requests through the AWS mechanism.

"It also means we can start to mix things up. So not only consulting services, but consulting propositions, we've got four of those live right now. So we started testing out proof of concepts as well.

"It's definitely going to grow which is the trend we've seen," said Lingwood.

What's Orban's advice to ISVs and channel partners that want to grow their business through AWS Marketplace?

"First, they need to make sure they have the right products, and the ones that customers actually want in the marketplace. Sometimes when ISVs get started, they start with their small or not their most impactful or value-adding products. And their results will be accordingly. So it's just like anything - you get what you put into it," he said.

"And then secondly, I would say work closely with our teams. We employ a team of category managers who work across the different categories to help the ISVs plan a joint go to market with us, which we can then put the AWS field team behind to help ISVs reach customers and then also do the right demand generation around it to make sure we get those new leads and traffic.T hen of course, as we start to do deals with the ISVs and the channel partners, we that celebrate that across AWS.

"The last thing I would say is both the ISV and the channel partners need to think about the right way to compensate their sellers. And then of course, work with channel partners if they aren't already - so whether it be Presidio, Softcat, Lemongrass or SHI to help them scale. We've got more than 500 of them working with us, so finding the right combinations of channel partners is also a best practice."