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2004-2005 U.K. Small & Medium Business IT Channel Partners Attitudes and IT Sophistication-Based Segmentation

Product Type: Market Research Report
Published by: AMI-Partners, Inc.
Published: October 2005
Product Code: R149-382
Description
AMI estimates that there are about 14,260 IT channel partners (excluding ISPs) in the U.K. that derive at least 50% of their annual sales revenues from sales to SMBs. Collectively, these IT SMB channel partners had annual revenues of $17.4 billion last year, making them a very attractive market for IT vendors.

As intermediaries between IT vendors and end-users, SMB channel partners play a crucial role in the highly dynamic IT industry. With different specializations like Value-Added Resellers (VAR), System Integrators (SI) and Network Integrators (NI), Independent Software Vendors (ISV), IT Consultants, Web Solution Providers and Communications Integrators, these channel providers sell a wide range of products and services to IT end-users. In addition, their proximity to, and close interaction with the end-users also provides them an opportunity to participate in, and influence their clients' brand selections. Thus, they are sought not only by IT vendors trying to reach the end-users of their products and services, but also by end-users trying to keep up with the ever changing technologies.

Like the customers they serve, IT SMB channel partners are a diverse group and, in many respects, the channel partners' industry mirrors the adoption profile of its customers. This is reflected in the products and services they offer, specializations they develop, size, location and attitudes toward new technologies, etc., a fact brought into sharp focus in the four segments of the channel partners' industry presented in this report. These four segments have a one-to-one correspondence with the four segments identified in separate reports by AMI for the end-users in the U.K. small business and U.K. medium business markets. By following a constant segmentation structure both for the end-users and the channel partners markets, IT vendors can develop a constant and highly actionable marketing strategy and also implement it with greatest effectiveness.

This report presents an overview of the U.K. IT SMB channel partners market segmentation. These segments, referred to as Tiers, represent a continuum from the technologically most sophisticated to the least sophisticated IT channel partners. Their technological sophistication is defined in terms of both the products and services they currently offer as well as their business attitudes (i.e. attitude toward adoption of new technologies, attitude toward marketing, and attitudes toward partnering with other businesses including IT vendors and other channel partners), which reflects their inclination to maintain their level of sophistication in the future. The Management Summary presents profiles of individual segments followed by detailed cross-segment analysis.
Table of Contents
Management Summary



Overview of U.K. Channel Partners SMB Segmentation



Profiles of U.K. Channel Partners Segments



Tier 1: Premium Service Providers



Tier 2 Channel Partners: Value-Priced Service Providers



Tier 3: Mainstream Service Providers



Tier 4 Channel Partners: The Laggards



Statement of Methodology for SMB Channel Partners Study



Overview



The SMB Channel Partners Study: Survey Methodology



Universe, Sample Selection



Data Collection Method



Weighting of Survey Data



Incentives



Survey Instrument



Issues Covered in Channel Partners Survey



Margin for Error



Channel Partners’ Background: An Un-Segmented View



AMI-Partners 2004-05 Channel Partners Segmentation



Actionable Four Tier Segmentation Model



U.K. IT Channel Partners Markets Segments



Background & Customer Profiles



Current and Planned Product & Services Offerings



Business Models and Attitudes



White Boxes Offered and Sold



Decision Making and Vendor Selection



Average Gross Margins Earned



Use of Internet/Web Site



Vendors Represented by Segment



Vendors Channel Partner’s Satisfaction by Segment



Glossary



List of Figures



Figure 1 - Overview of 2004 U.K. SMB Channel Partners Segments



Figure 2 - Channel Segmentation: Mapping Partners to SMB Customers



Figure 3 - Summary of 2004-055 UK SMB Channel Partners



Figure 4 - Summary of 2004-05 UK SMB Channel Partners (Continued)



Figure 5 - Summary Profile of Tier 1



Figure 6 - Summary Profile of Tier 2



Figure 7- Summary Profile of Tier 3



Figure 8- Summary Profile of Tier 4



Figure 9- Methodology



Figure 10- Methodology (Cont’d.)



Figure 11- Issues Covered for the 2004 U.K. SMB Channel Partners Study



Figure 12- Margin of Error



Figure 13 - 2004-05 Structure of U.K. Channel Partner Industry



Figure 14 - Summary of Findings



Figure 15 - Primary Activities of Channel Partner



Figure 16 - U.K. SMB Channel Partners Segmentation Model



Figure 17 - Questions Used for SMB Channel Partners Segmentation



Figure 18 - Primary Business Activities by Segment



Figure 19 - Location of Channel Partners by Segment



Figure 20 - Age of Channel Partners by Segment



Figure 21 - Annual Sales by Segment



Figure 22 - Number of Employees by Segment



Figure 23 - Number of Locations by Segment



Figure 24 - Number of Active Customers by Segment



Figure 25 - IT Intensity of SMB Customers by Segment



Figure 26 - Vertical Markets Served by Segment



Figure 27 - Revenue Mix by Customer Size by Segment



Figure 28 - Avg. Annual Customer Account Size by Segment



Figure 29 - Channel Partners Influence in Customers Brand Selection by Segment



Figure 30 - Number of Products & Services Offered by Segment



Figure 31 - Effectiveness of Vendor Communication Strategies



Figure 32 - Current and Planned Computing Hardware and Software Offerings by Segment



Figure 33 - Current and Planned Networking & Internet Offerings by Segment



Figure 34 - Current and Planned Security and IT Services Offerings by Segment



Figure 35 - Current and Planned Security and IT Services Offerings by Segment



Figure 36 - Channel Partners Offering White Boxes By Segment



Figure 37 - Revenues Derived from Different Products & Services By Segment



Figure 38 - Revenues Due to Different Sales/Business Development Activities



Figure 39 - Vendor Selection Criteria by Segment



Figure 40 - Vendor Selection Criteria by Segment (continued)



Figure 41 - Vendor Selection Criteria by Segment (continued)



Figure 42 - Avg. Margins for Computing & Networking Hardware by Segment



Figure 43 - Avg. Margins for Packaged & Customer Software by Segment



Figure 44 - Avg. Margins for Internet Services, IT Services & Telephony by Segment



Figure 45 - Currently Have or Plan to Have a Web Site by Segment



Figure 46 - Percent of Revenues from Internet Sales by Segment



Figure 47 - Semiconductor & Computing Vendors Represented By Segment



Figure 48 - Networking & Storage Vendors Represented By Segment



Figure 49 - Software & Security Vendors Represented By Segment



Figure 50 - Semiconductor & IT Vendor’s Satisfaction By Segment



Figure 51 - Networking & Storage Vendor’s Satisfaction By Segment



Figure 52 - Software & Security Vendor’s Satisfaction By Segment
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