In 2020, cloud services came to the rescue of many organizations. Businesses, educational institutions, non-profits and government departments were all compelled to rapidly adopt services that enabled remote working, collaboration and communication. It was a grand experiment forced on us by circumstances – and it worked, changing how we do business for the foreseeable future.
In 2021, cloud has become the perfect partner for the small and medium-sized business (SMB) looking to embed agility, flexibility and scale at a cost-effective price point. This presents managed service providers (MSPs) with the opportunity to respond to evolving customer requirements, particularly in the SMB segment. MSPs can now leverage the fact that cloud has become an essential tool to support growth into 2021, and beyond.
According to research firm Analysis Mason, SMBs that have been forced to rapidly adopt technology during COVID-19, are looking for more than a transactional relationship when engaging with an MSP. They want a partner that can support their digital transformation and strategic cloud investment, while allowing them to remain cost-aware and scalable. Those service providers that can meet this need, and collaborate with SMBs to embed relevant cloud architecture, will continue to increase their market share over the next five years. The report did highlight, however, that those service providers that remained within purely transactional relationships during 2020 lost market share. In short – value-added services have become a commodity in a buyer’s market.
According to the Analysis Mason survey, 28% of SMBs started using collaboration tools and 46% of SMBs already using these tools increased their use to navigate working from home and serving customers remotely. Looking ahead, the direct impact of the ongoing pandemic is bound to have a long tail, further driving uptake of cloud-based technologies to support SMB operations. Looking forward, SMBs will want return on investment for their pandemic-accelerated investments, while more than half of the SMBs plan to increase the use of new cloud and digitalization solutions.
Service providers that walk side-by-side with their customers, helping them to navigate the complexities and opportunities that lie ahead, are set to fare better than their more transactional-focused peers. This stands to reason, considering that the research showed that MSPs will account for 17% of SMB IT spend by 2025, especially given SMBs’ reduced access to more robust IT resources.
The takeaway for service providers? This shift is here to stay. To retain and gain market share, all service providers should consider their relationships with their customers. Are they purely transactional, or are they sustainable in the long term? Do they add value beyond the basic technology transaction? Service providers can pull from their expertise and industry understanding to cement long-term relationships with a growing, and dynamic, customer base.
What this new relationship-driven formation looks like will differ from service provider to service provider, but at HPE we are committed to helping our service provider partners succeed. This is why we spearheaded Cloud28+, the world’s largest independent community dedicated to accelerating enterprise cloud adoption. Cloud28+ provides a one-stop platform for customers to easily find local service provider offerings and capabilities. In turn, service providers gain in market visibility, and can also explore new partner-to-partner alliances, promotional tools, and increased access to HPE resources.
We invite you to become a Cloud28+ partner member today. It takes just a few minutes, and you gain a powerful growth engine for your business to reach more customers and expand your offerings.