The chief advantages of cloud solutions—namely, reduced capital expenses, increased responsiveness, and subscription-based pricing—are definitely compelling for many SMBs. And in large part, SMBs are responding. According to a 2011 study of cloud adoption trends released by Microsoft Corp., 39 percent of SMBs plan to use the cloud for one or more services within three years. On average, those SMBs that pay for cloud solutions will be opening their wallet for more than three cloud-based services.
Yet despite the burgeoning popularity of cloud solutions, channel partners shouldn’t think that the cloud is an easy sell. For customers, accepting the concept is often a difficult proposition, especially for those who have security concerns or who are simply accustomed to having their IT assets close at hand. To sell cloud-based solutions, channel partners need to take a services-based approach to IT—a strategy that requires a more consultative relationship with customers. For channel partners, it’s not so much about products; rather, they need to delve into their customers’ problems first and then suggest the appropriate cloud-based solutions that address those specific problems.
Any cloud sell should first begin with customer education, but be sure to leave out the technical nitty-gritty. While arguably the most dominant trend in IT, the cloud is also a victim of its own success. “There is confusion on what ‘cloud’ is due to vendor marketing hype,” says Earle Humphreys, CEO of ITEEx, a provider of channel development and consulting services for vendors and VARs in Conroe, Texas. In effect, cloud solutions are the same as on-premises solutions, except that they are delivered remotely over the Internet. As such, Humphreys adds, the cloud isn’t a radical departure from traditional IT, and yet that is often the prevailing message that many SMBs receive. “The computing model has been around for decades,” he adds. “In fact, large vendors were doing virtualization [an enabling cloud technology] in the ’70s.”
While the concept of cloud computing isn’t new, it does introduce a different way to obtain IT resources. This is why Terry Wise sees change management as one of the first areas that channel partners must address when selling cloud solutions. “This is a different model,” says Wise, who is director of partner programs for Amazon Web Services (AWS), a provider of infrastructure Web services based in Seattle. “Instead of having servers in their own data center, they have virtual Internet capacity that is not within their four walls.” One of the best strategies for getting SMBs on board with cloud computing is helping them choose the right application to get started, and then get them comfortable with the implementation process. As Wise sees it, showing SMBs specific cost savings will only get channel partners so far. “At the end of the day, speed to market is really what hooks customers,” he asserts.
For risk-averse SMBs, channel partners should emphasize the evolutionary rather than revolutionary aspect of the cloud. After all, most SMBs aren’t keen on being technology trailblazers, but they do want to stay up to date with IT if it improves how they operate their business. In this vein, Jags Raghavan, vice president of business development for 8KMiles, a cloud services provider in Hamilton, N.J., recommends focusing on relatively simple systems and applications first. “You don’t want to take the most complex system and move it to the cloud,” he says, adding that the most expedient way to demonstrate the cloud’s value is to migrate the low-hanging fruit such as email or collaboration systems to the cloud first. The functionality of existing on-premises systems can often be replicated in a cloud environment without much of a learning curve; channel partners then have a tangible cloud-based project with which to calculate ROI or show SMBs how to leverage the cloud for their business.
In addition, speed-to-market advantages can best be demonstrated with familiar applications and systems. In fact, Humphreys recommends that channel partners show first how their cloud solutions are related to what they already offer on premises. “Position the offering as an option to your on-premises solution, as it helps your client relate to it by something they understand,” he says.
Cloud-based solutions can also be introduced incrementally and for a short period of time, making many such solutions less risky than on-premises versions, according to Jeff Kaplan, managing director at THINKstrategies, an IT consulting firm in Wellesley, Mass. “There are no worries about vendor lock-in up front,” he says. “SMBs that make a bet on a traditional application or system have to put up the money up front, and there is no return policy.” With cloud applications, many vendors provide free 30-day trials or at the very least good visibility into how such applications operate online. “You can pilot cloud solutions to see how you like it, or acquire solutions in small increments and then expand the usage as needed,” Kaplan says, thereby limiting the risk of investing in technology that either no one will use or that doesn’t quite satisfy an organization’s needs.