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Techaisle Blog

Insightful research, flexible data, and deep analysis by a global SMB IT Market Research and Industry Analyst organization dedicated to tracking the Future of SMBs and Channels.

Davis has been working in the Information Technology industry for over 25 years and has a proven track record in market research, business intelligence and marketing.

Davis Blair

China Rising - Mid-Market Onsite and Remote Managed Services nears $3B

A recent Techaisle survey of 1,862 SMBs in China found the market for Onsite/Remote Managed Services has been growing rapidly and is near the $3B mark in the mid-market space; expected to reach $2.847 billion in 2012.

Davis Blair - Techaisle - Global SMB, Midmarket and Channel Partner Market Research Organization - Techaisle Blog - Page 7 China-Mid-Market-RMS-Opportunity-e1346213492267

 

Other important points include that the 250-499 employee segment represented the largest share among company sizes, with 47.5% of the total. This is followed by the 100-249 group with ~30% and finally the 500-999 category with ~23%.


On the Services side, PC Services are the largest segment with $800 or 28% of the total, followed by Other Managed Services $509M or 18%, and Server at $485 or 17%, Seven of the top 10 service segments top $100M, providing a good  set of opportunity segments.

Davis Blair - Techaisle - Global SMB, Midmarket and Channel Partner Market Research Organization - Techaisle Blog - Page 7 Shanghai-swft9vp-300x204 Having lived in Korea and  Hong Kong from the early 1980s through the mid-1990s and watching the Seven Tiger markets rise from bit players to important gears in the global IT supply chain, this doesn't really come as a surprise - however the rapidity and thorough break away toward private property and commercial economy  that China has managed, exceeds even the early predictions and forecasts.

The overwhelming reason for using Managed Services in China across all segments was Cost Control. This was followed by the need to Focus on the Core Business which is very difficult for SMBs with limited skilled resources, even in a country like China where hiring a new FTE to support basic IT infrastructure is relatively inexpensive as compared to many other countries.

 

The third most important reason was to free up the IT staff so they can add other types of value to the organization; helping to move IT from a Cost to a Profit Center.

 



 

Techaisle's SMB managed services adoption and trends data and analysis is available as individual country reports for US, UK, China, India, Brazil, Germany, Australia.

 



Davis Blair
Techaisle
Davis Blair

VideoPost - SMB Marketing Automation Purchase Intentions

Please click through for a quick snapshot of Current Adoption and Purchase Intentions for Marketing Automation within the US Small and Medium Business (SMB) Market:

Davis Blair

SMB Marketing Automation - Strong Mid-Market Adoption

Davis Blair - Techaisle - Global SMB, Midmarket and Channel Partner Market Research Organization - Techaisle Blog - Page 7 gears-300x300

As mentioned in a previous post on Marketing Automation, the adoption patterns and benefits of these applications and services differ by size of company.  In this post we will focus on the applications and functionality currently used and planned for purchase by Mid-Market companies, from 100-999 employees.

Marketing automation can be defined as a group of software applications designed to increase the efficiency of managing customer relationships by reducing repetitive tasks and automating processes that maximize customer revenue. This is done by identifying, prioritizing and converting sales leads, and systematically maintaining the customer relationship by being proactively in front of them with relevant offers for recurring business and an ongoing relationship.

 

Davis Blair - Techaisle - Global SMB, Midmarket and Channel Partner Market Research Organization - Techaisle Blog - Page 7 Mid-market-marketing-automation-feature-usage8-1024x727

 

What we found in a recent SMB survey of just over 1,200 respondents is that typically, the larger the company the more likely they are to be using Marketing Automation Apps/Functions within their existing software solutions. By the time SMBs reach the 500-999 employee level, certain applications such as outsourced email and campaign management are used in 70%+ of the accounts surveyed, expected to reach 90%+ by this time next year. Other fast growing areas include Personalization, CRM Integration and Web Analytics, all expected to reach a  penetration level of at least 80% by 2013 in the upper segments of the SMB market.


Research also shows that adoption has been spurred by the changing characteristics of the market today; there is much less risk involved in adopting SaaS and/or Cloud-based software applications than there used to be - when internal groups were responsible for rolling out complex solutions involving purchase and configuration of hardware, software licenses and provisioning of datacenter services. Ability to take advantage of this Enterprise-level functionality based on a monthly subscription and minimal impact on HR requirements is a no-brainer for most SMBs.

In the coming few weeks, we will provide additional analysis from our latest including Virtualization, Mobility and Managed Services as well as Cloud Computing.

Davis Blair
Techaisle

Davis Blair

SMB Cloud Computing Applications are Squeezing Channel Relationships

Davis Blair - Techaisle - Global SMB, Midmarket and Channel Partner Market Research Organization - Techaisle Blog - Page 7 vendor-direct-blog2-300x199 It is becoming quite well-known that traditional channel relationships, which developed over a thirty period based on PC, LAN, PC Server and Client Server architecture are changing rapidly based on the characteristics of Cloud Computing  products and services.  And now we have data to prove it based on Techaisle surveys of SMBs.

It is in some ways analogous to how the industries where value could be digitized were essentially transformed by the Internet because the value could move instantly around the globe. On a worldwide network, even a relatively slow one, bits gained an advantage over molecules in advertising, banking, music and entertainment, travel,  insurance, and many others.

With Cloud Computing, Remote Managed Services, Virtualization and other emerging cloud-based technology applications such as marketing automation, business intelligence and vertical applications exploding in the SMB marketplace, distribution channels face new challenges; these solutions can be efficiently delivered directly to the SMB customer, can be downloaded from the Internet, can be configured by savvy SMB customers or remotely, can be maintained, updated and upgraded online - in many cases the value can be delivered online. To further stack the deck, vendors who do not need help delivering complex solutions don't really have an incentive to work with a partner; to the contrary, they are able to sell much more efficiently by using the web channel and an inbound sales force. If you doubt it, sign up for a free SaaS trial and if they don't call within two hours, you are the exception.

SMB Channel Preference by Cloud Technology


The survey data shows a cross-tab of SMB decision makers,  and shows that for the majority of new cloud-based applications and services Vendor Direct and VAR are the preferred sources of purchase.

Davis Blair - Techaisle - Global SMB, Midmarket and Channel Partner Market Research Organization - Techaisle Blog - Page 7 vendor-blog-blog-graph3

At this point it makes sense to discuss the channels and why some are more suited to certain types of employee size businesses than others. We categorize Cloud Services into Infrastructure, Communications, Business Applications and Vertical Market categories.  Provisioning of infrastructure services, like adding remote storage and back up services, has been simplified through web based interfaces and is well within the reach of IT staff. Similarly, horizontal SaaS applications can be up and running in minutes and customized by business users in a matter of hours or less - think GoDaddy, Constant Contact, Central Desktop, GotoMeeting, Sherweb - why pay a channel partner to implement these services?

Adding Value to Self Service Applications


Value Added Services become necessary in relation to the level of solution complexity; in business applications like robust CRM and ERP solutions from companies like Salesforce.com and Netsuite. Even if configuration can be accomplished with Internal IT staff, it may be better to let a VAR  or specialist do it to save time and money, as with configuring Enterprise Applications like Siebel and SAP. Cloud Data, Network and Application Integration Services are also in high demand and capable Service Providers have no shortage of potential partners.

As discussed in an earlier post, these relatively easy-to-deploy solutions have also given rise to an  important new source of advice, recommendations and services - the independent IT consultant - which will be the subject of one of our next posts.

Davis Blair
Techaisle

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