Why AppDirect Spun Out the ADCom Partner Business

AppDirect's purchase of a network operations center (NOC) platform is helping its technology advisor partners gain more insight into their customers.

So said AppDirect chief operating officer Renée Bergeron, who shared with Channel Futures how the subscription commerce company integrated ADCom Solutions since buying it last year. ADCom's NOC platform now functions as the backbone as a managed services offering that AppDirect partners can white-label as their own. Bergeron said 171 AppDirect advisors (agents) have sold a managed service deal or put one in the pipeline since Aug. 1. Moreover, 1,500 end customers are actively using the VNOC Platform, she said.

AppDirect's Renée Bergeron

ADCom Advisory Business

AppDirect last summer announced its purchase of ADCom. The stated goal: to establish a network operations center (NOC) service that AppDirect's technology advisor (agent) partners would white-label as their own.

However, the future of ADCom's agency and resale business, which included a long relationship with AT&T, was unknown.

Bergeron said in a recent industry panel discussion that AppDirect in January helped the direct sales group at ADCom start a standalone business. ADCom's former owners are now running VersatilIT, which is doing business as ADCom Solutions. As part of the agreement, ADCom is using AppDirect as its exclusive technology services distributor — meaning that it sells underneath AppDirect's supplier contracts.

Related:AppDirect Buys ADCom Solutions, Touting Managed Services Chops

The spinoff helped "preserve the value" of existing ADCom agency customers, Bergeron said. Also, she said AppDirect was intent on signaling to its community of channel partners that it would not maintain any channel business that went direct to the end user.

"This is the extent to which we're going in order to not compete against our channel," she said.

Five months later, Bergeron says the spun-out ADCom team has embraced the AppDirect portfolio, which is well known for its breadth of software-as-a-service (SaaS) products.

ADCom, known for its strengths in carrier services sales, has taken up the challenge, Bergeron said.

"They've been used to selling a lot of AT&T business and managed services, and now they've been able to tap into the rest of our catalog. They're selling more solutions to their existing customer, and it's allowing them to really accelerate their growth."

Bergeron said ADCom/VersatilIT likely has ranked among AppDirect's top 10 advisors in sales for 2024.

"They've got the wind in their sails," she said.

A NOC Offering for Partners

Amid the plans to spin off the ADCom channel partner business, AppDirect was putting together its white-label VNOC service.

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The ADCom VEEUE management and monitoring platform – comprised of technology ServiceNow, LogicMonitor and Sisense – is at the core of VNOC (which is short for VEEUE-powered Network Operations Center). People who have come over via the acquisition, along with AppDirect's own hires, are using the platform to remotely monitor and respond to incidents involving various devices and endpoints.

Managed services is a popular topic among customers and vendors alike. While managed IT services and managed security services might get more fanfare, countless carriers have rolled out NOC-based managed network services.

"Selling [VNOC] is relatively easy because end customers have accepted the fact that it doesn't make sense for them to invest in doing it. Everybody's outsourcing managed services," Bergeron said.

While it's not the first NOC service in AppDirect's extensive marketplace, it is the first in-house offering, rather than a supplier partner. Bergeron said it's natural for the in-house and partner offerings to coexist on the marketplace.

"You can view it just like another provider in our portfolio. Just like if you go to Amazon, you can buy paper for your printer from HP or from Amazon Basics or from a lot of other providers," Bergeron said.

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But partners who sell the white-label offering will see a deeper feed-in to their future sales, Bergeron said. She said advisors can access VNOC in the AppDirect environment and from there take inventory of all customers who have procured managed services from AppDirect. Those insights can help partners consult and sell better. Bergeron likened VNOC to "selling a telescope into how the technology is performing for the customer."

"For each of them, they can dive in and see, have there been a lot of alerts recently? Are there circuits that are overloaded? If an advisor is preparing for a meeting with their customer, they can go in proactively look at how their technology has been performing in the last couple of months," she said.

Bergeron said more than 60,000 devices and 28,000 internet circuits are under VNOC management.

Long-Term AppDirect Goals for the Channel

AppDirect has bought and integrated numerous technology services distributors ("TSDs," formerly known as master agents) and in 2022 integrated its "AppSmart" TSD business with the AppDirect brand.

Gartner in its 2023 Magic Quadrant for Digital Commerce predicted that digital channels will host 80% of B2B sales interactions by 2025.

AppDirect has nuanced its approach to marketplaces with its inclusion of technology advisors. Bergeron framed the AppDirect platform as a vending machine that sits inside the customer environment — one through which partners will guide their customers.

"That doesn't speak to the demise of the channel; quite to the contrary, because of the complexity of buying solutions. But the ability to execute that transaction and then to manage that subscription on an ongoing basis via marketplace is critical to buyers. In that sense, AppDirect is uniquely positioned to help our technology advisors stay relevant and thrive in the coming years," she said.

Bergeron said the marketplace's portfolio of vendors is widening at a fast clip, with a new supplier joining either every other week or every week.

"That's anywhere from 25-50 this year. We're going to double and quadruple that pace next year with the introduction of some automation we're building," she said. "Cross-selling is all about having the broad catalog and the competencies to help the advisors know how to use these solutions. So I think we're well positioned for that."