Customer Inertia Top Among Tech Advisor Challenges

Technology advisors are evolving to guide buyers through an IT decision-making process that's growing ever more complex.

Respondents to Channel Futures' Q1 partner market outlook survey most commonly cited customer inertia as a top challenge in their business. Forty-three percent of technology advisors (agents) listed customer inertia/inaction. While the survey results show a healthy channel that is driving growing revenue, partners still admit that getting clients to move on technology projects has flummoxed them.

It's a common maxim among agents that their biggest source of competition is not other channel partners or sellers, but the customer simply saying "no" or "not yet." A previous survey found that partners were more threatened by the potential of “the customer not doing anything” than of a rival partner or provider swooping in and selling to their customer.

Q. What were the top challenges your business faced in Q1 2024? (Select up to three)

Channel Futures' Q1 Market Outlook Survey

What Is Causing Customer Inertia?

Customers still show plenty of willingness to spend money. Thirty-four percent of TAs said client appetite for tech spending increased 34%, while 17% said it decreased.

But it takes more than appetite to complete a technology transformation. Partners have told Channel Futures that the IT purchasing process is growing more and more complex, with far more stakeholders involved than ever. The IT purchaser – if there even is a single one – might not understand how their company's buying journey works.

Related:Tech Advisor Revenue Pacing Ahead of 2024 Projections

"Over the last several years, I’ve experienced companies moving to buying by committee or in the case of enterprise-size organizations, needing more than 15 levels of signatures," said Symplicity Communications CEO Catherine Behrenbrinker.

Symplicity's Catherine Behrenbrinker

Behrenbrinker said what some sellers consider "customer inaction" might actually just be the deal moving gradually through the regular procurement process.

"This can delay a project coming to fruition by months, leaving a salesperson with a feeling of inaction," she told Channel Futures.

But in some cases, customers just don't see strong reasons why they should switch technology.

“End users can be reluctant to change and need to see value clearly in order to be motivated toward change. Our mission is to showcase newer solutions to our partners, demonstrate how they can bring value, and then equip our partners to sell them," said Paul Constantine, senior vice president of supplier services at Intelisys. "Older technologies are still popular, and, because of that, partners need to deliver a rock-solid pitch to the customer, highlighting the value and return on investment of the new technology."

Sometimes the sellers need to do more to give buyers confidence to move forward.

"The No. 1 enemy of all sales efforts is to do nothing. 'Do nothing' happens when the sales team has not elicited enough specific challenges with the current platform and demonstrated how those challenges are costing the company revenue or productivity or both," said Brent Wilford, Avant's senior director of CX and unified communications.

Overcoming Customer Inertia

Wilford said sales teams need to demonstrate a detailed accounting of return-on-investment and total cost of ownership businesses will experience if they move to a new platform. Those IT buyers need to know that information to be motivated to advocate for the project within their company.

"The challenge is that you have to be able to build a strong business case for a new platform and be able to present it to a non-technical buyer in most cases. CFOs aren't going to sign off on $20,000-$50,000 [monthly recurring revenue] if they don't understand the tangible benefits and cost savings to the business," Wilford said.

ATC shared its observations of sales cycle delays last summer, but president and chief technology officer Nick Enger said buyer delays have not been a major challenge so far in 2024.

ATC's Nick Enger

“We certainly felt some of that in the first half of 2023 due to the economic headwinds, rise in interest rates, etc. As of 2024, we have not felt much of that, if at all," Enger told Channel Futures.

Part of the success stemmed from helping customers understand ATC's process and ensure both parties are mutually engaged.

"We review the process, project plan and the milestone events (i.e. contract sign off, etc.) during every client interaction. The more the client is bought into the process, the less likely they are to fall out of the process,“ Enger said.

ATC of Ohio CEO David Goodwin noted that his team nevertheless invests in resources to train its consultants on the sales side of the process.

"We do that for a variety of reasons — keep projects moving, keep our projects on the front burner or a priority, help our clients brings projects to fruition and/or solve problems sooner, avoid ghosting, educate clients on the cost of indecision, etc," Goodwin said.

Behrenbrinker said technology advisors make the buying process more transparent for clients that are considering purchasing technology from a vendor.

"Creating relationships with clients with the intention of understanding the steps of how they buy can alleviate the stress caused by the delay to get all the necessary approvals," she said. "Conversely, choosing vendors that agents can create a deeper understanding and trust with will help set the tone when the service provider tries to push their sales process that doesn’t align with the client’s process. It is the agent’s job to keep aligning the client and services provider along the customer journey — I see this as a three legged stool.”

Other Challenges for Partners

Trailing customer inertia were a myriad of supplier-related concerns.

Partners' second most commonly cited challenge was the quality of vendor service. Vendors/suppliers in the agent model bill the end customer and support the solution sourced by the partner. The intertwined relationship between agents and vendors makes missteps by the vendor all the more painful for the agent.

The third biggest challenge was managing vendor relationships.

Next was industry consolidation; onboarding new vendors and the pace of technological advancement tied for the fourth biggest challenge.

Technology advisor respondents showed the least amount of concern over government regulations.

In the "other" category, partners pointed to inaccurate commissions, changes to tax laws, and disorganization on the vendor delivery side.

See other findings from Channel Futures' Q1 2024 partner survey: