2112 Survey: Channel Chiefs Extend Help, Maintain Optimism Amid COVID-19 Crisis
March 25, 2020
Channel executives anticipate a severe economic downturn resulting from the pandemic, but most are holding back on cutting budgets.
By Larry Walsh, Channelnomics Staff
Even as the COVID-19 crisis continues to unfold, channel chiefs are holding tight on cutting critical sales and marketing budgets that affect partner operations. And that’s despite the fact they’re foreseeing a steep economic downturn in the second quarter, according to a new survey by The 2112 Group.
The COVID-19 Impact on the Channel survey offers a first look into how the technology channel is reacting and responding to the pandemic. 2112, a strategy and intelligence firm that also publishes Channelnomics, finds that channel professionals who run the vendor partner programs are feeling the ramifications of the crisis.
Here’s what the three-day survey of 119 channel professionals has found:
• 37% of vendors are already seeing partners cancel orders and slow pay on accounts.
• 23% are struggling with the shift to enable and manage remote workforces.
• 18% are dealing with supply-chain disruptions.
While 83% of channel professionals anticipate the economy souring for the remainder of 2020, 58% believe their partner programs will achieve or exceed their pre-pandemic sales targets. A fair amount of the performance optimism comes from the anticipation of a robust recovery in the second half of the year as social distancing measures subside and release pent-up demand for products and services.
Technology vendors aren’t letting partners go through the pandemic crisis alone. The survey finds that vendors are offering partners more free software and services, free or discounted technical support, extended payment terms on new orders, and extended lines of credit.
Economists expect the global economy to decline as much as 25% in the second quarter. In the United States, the economy could contract anywhere from 12.5% to 30%. Even with the massive $2 trillion economic stimulus package coming out of Washington, D.C., the expectation is that sales in all sectors will decline significantly between April and June due to the inability to conduct normal commerce.
Despite the economic forecast, channel executives are standing firm on their budgets. In the early stages of the crisis, channel professionals said they’re either maintaining or increasing their channel sales, marketing, and partner incentive budgets.
The COVID-19 Impact on the Channel survey shows, at least in the early period of the crisis, that channel chiefs and vendor program managers are trying to maintain a sense of order and commitment amid extremely challenging and deteriorating circumstances.
Nevertheless, the survey is a snapshot in time amid daily, if not hourly, change. 2112 anticipates that perspectives and measures taken by vendors in their channel programs will change as the pandemic’s economic impact unfolds over the next several weeks.
2112 plans to continue surveying and measuring the COVID-19 impact on channel programs, field sales and marketing, and partner performance. The COVID-19 Impact on the Channel and all basic pandemic impact research conducted by 2112 is free for download.
For more information about how the COVID-19 pandemic is impacting the channel, visit Channelnomics’ ongoing crisis coverage.
The COVID-19 Impact on the Channel survey offers a first look into how the technology channel is reacting and responding to the pandemic. 2112, a strategy and intelligence firm that also publishes Channelnomics, finds that channel professionals who run the vendor partner programs are feeling the ramifications of the crisis.
Here’s what the three-day survey of 119 channel professionals has found:
• 37% of vendors are already seeing partners cancel orders and slow pay on accounts.
• 23% are struggling with the shift to enable and manage remote workforces.
• 18% are dealing with supply-chain disruptions.
While 83% of channel professionals anticipate the economy souring for the remainder of 2020, 58% believe their partner programs will achieve or exceed their pre-pandemic sales targets. A fair amount of the performance optimism comes from the anticipation of a robust recovery in the second half of the year as social distancing measures subside and release pent-up demand for products and services.
Technology vendors aren’t letting partners go through the pandemic crisis alone. The survey finds that vendors are offering partners more free software and services, free or discounted technical support, extended payment terms on new orders, and extended lines of credit.
Economists expect the global economy to decline as much as 25% in the second quarter. In the United States, the economy could contract anywhere from 12.5% to 30%. Even with the massive $2 trillion economic stimulus package coming out of Washington, D.C., the expectation is that sales in all sectors will decline significantly between April and June due to the inability to conduct normal commerce.
Despite the economic forecast, channel executives are standing firm on their budgets. In the early stages of the crisis, channel professionals said they’re either maintaining or increasing their channel sales, marketing, and partner incentive budgets.
The COVID-19 Impact on the Channel survey shows, at least in the early period of the crisis, that channel chiefs and vendor program managers are trying to maintain a sense of order and commitment amid extremely challenging and deteriorating circumstances.
Nevertheless, the survey is a snapshot in time amid daily, if not hourly, change. 2112 anticipates that perspectives and measures taken by vendors in their channel programs will change as the pandemic’s economic impact unfolds over the next several weeks.
2112 plans to continue surveying and measuring the COVID-19 impact on channel programs, field sales and marketing, and partner performance. The COVID-19 Impact on the Channel and all basic pandemic impact research conducted by 2112 is free for download.
For more information about how the COVID-19 pandemic is impacting the channel, visit Channelnomics’ ongoing crisis coverage.
