Welcome to 2021, the year our distributors and their partners fulfill a grand promise I have been preaching throughout my multiple decades at Cisco. Digital transformation for small and mid-sized businesses offers an inherent opportunity for our partners.
Cisco, our distributors, and the VARs and MSPs they serve share a common goal to drive business growth and efficiencies for our customers, and now technology has thrown the gates of opportunity wide open for small and mid-sized businesses. The cloud and SaaS have made enterprise-scale digitization available to every player.
The benefits of digital transformation are rooted in innovative apps that previously required investment in an in-house infrastructure. But Cisco has been engineering its technology to be consumed as a service, or as cloud-delivered networking, making it easily accessible, simplified, secure, and cost-effective. Partners can help their customers deploy apps quickly to drive business value and process improvement that was once out of reach for smaller IT budgets.
The landscape is in our favor.
Today, applications are everywhere: SMBs are not only increasing their use of pre-packaged SaaS, but they are also benefiting from custom-developed apps on cloud platforms like AWS, Azure and Google Cloud. These SMBs can take advantage of apps and infrastructure at a fraction of the cost and complexity we saw just 5 years ago.
Not only have consumption models expanded, this past year, we have seen “a decade of change in the blink of an eye” as employers, almost overnight, had to support employees working from anywhere. Cisco has always had the superior infrastructure to support secure remote work, and we have now moved these essential capabilities to a cloud-delivered model. Another business advantage now easily accessible to SMBs.
Baked into the necessity to deploy work-from-anywhere is the overwhelming necessity to do it securely. Cisco’s Secure Access Service Edge (SASE) solutions deliver comprehensive network and security capabilities from the cloud … on a budget. Zero Trust solutions, including Duo Multi Factor Authentication, secure critical apps wherever they run.
WebEx meetings and cloud-calling connect the work-from-anywhere crowd with a 10X better experience. And Meraki cloud-delivered networking takes the inherent complexity out of deployment and support, without compromising on capabilities.
Sarah Eccleston, our VP of Global Small Business Segment, stated the pivotal importance and opportunity of SaaS to the small business market with its inherent value to partners who serve them:
“SaaS is an increasingly important part of our Small Business portfolio, and it’s crucial that we have the routes to market in place to make it easy for our customers to buy. As organizations have discovered the advantages, and sometimes the necessity, of secure remote work, we have seen our small business customers buy more and more of our SaaS in security and collaboration. In fact, the percentage of our small business revenues which are SaaS is continually increasing.”
SaaS and Cloud are in the Sweet Spot for all of us.
According to Gartner, SaaS is estimated to reach $140.7 billion worldwide by 2022. In fact, this market is growing all around us, so it’s time for all of us to seize the opportunity to help our customers and to grow our own businesses.
According to Pam Miller, Director of Infrastructure Channels Research at IDC, “Services, as a percentage of total partner resale, are up from 22% in 2015 to 65% of total partner resale in 2020”. This is driven by SaaS.
And Marc Inderhees, our Sales Acceleration & Enablement Leader, GPO Partner Managed Services and XaaS Sales, confirms that small business growth is strongly influenced by our MSP partners. According to Inderhees, “The past year was an accelerator for our MSPs. SMB customers relied heavily on them as they were connecting remote workers, securing them, and enabling the users to communicate and collaborate smoothly. It created pull-through for Meraki, security, WebEx collaboration, and connectivity.”
Cisco SaaS is high growth in the channel overall, and accelerating especially with our small and mid-sized customers. Those of you who primarily serve these customers – distributors, VARs and MSPs – have seen triple-digit SaaS growth in recent months. Hard to ignore – and time to lean in a little harder.
Cisco is responding to the growth potential by evolving our incentive programs to reward SaaS performance. In fact, partners enrolled in our Perform Plus program will find a new SaaS incentive in the new year, and VIP Annuity continues to expand.
Our Distributors are here to help.
“As partners’ business, both resale and non-resale, moves increasingly to services, management of recurring revenue becomes increasingly important. The complexity of managing multi-vendor recurring revenue invoicing is encouraging partners to move to distribution where ongoing invoicing is managed for them,” Miller emphasized, adding that “Multi-vendor Solution building, lifecycle management, and combined physical and virtual products on a single invoice” are among other benefits to the reseller.
Cisco’s objective is to expand our presence globally in the marketplaces of our distributors and partners. We see an outstanding opportunity for simplification and scale across all of our recurring offers, as we effectively support our VARs and MSPs through these marketplaces.
Call to Action
At Cisco, we see a future powered by SaaS and cloud-delivered networking for our Small and Midsized customers. We are simplifying our offers, pricing them competitively, and working with our distributors to accelerate the success of our VARs and MSPs. Secure Remote Work (this is a SalesConnect link requiring a Cisco Partner login) is a perfect example, and our partners should take it to their customers as soon as possible.
Secure Remote Work is a cloud-based security and collaboration solution that is easy to consume, deploy and use. It enables our customers to provide a high-quality work experience from anywhere – securely – and, because it is cloud-based, customers will see real benefits in minutes.
SaaS is a multi-billion-dollar opportunity, with the potential for high growth and access to new customers and new partners. So, go out and get them. We’ll be with you all the way.