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CompTIA's ChannelCon 2017 reminds solution providers to keep pursuing recurring revenue offerings in vertical industries. 

Cybersecurity and cloud-based Software-as-a-Service (SaaS) offerings are among the leading money-making opportunity for channel partners who are looking to add more recurring revenue to their business. That was the message from several of the speakers at CompTIA's ChannelCon 2017 Vendor Summit in Austin, Texas, earlier this month.

According to CompTIA's research, three-quarters of all channel partners surveyed identified themselves as selling some SaaS, and one of the reasons they are breaking into SaaS is to get away from selling horizontal solutions. With horizontal sales, a company sells products and services to any company in any sector. But these days many IT solution providers are finding it more lucrative to focus on one or two vertical (or niche) markets.

CompTIA's CEO Todd Thibodeaux addressed the advantage solution providers can have in vertical markets when he spoke to CRN about new solution provider opportunities this month. Thibodeaux said channel partners could, for instance, unlock additional credit or payment processing opportunities by helping their customers move from Peachtree or Quicken-based financial management products to cloud-based application services. That's a specific example where a solution provider could target a vertical market and offer a SaaS-based solution for recurring revenue.

Pursuing vertical industry opportunities with cybersecurity or SaaS offerings requires channel partners to look closely at staff make sure they're correctly set up to take advantage of these channel opportunities. For example, Thibodeaux said security-focused partners don't need as many break-fix technicians, salespeople or ongoing customer support agents, but need to beef up expertise around compliance, cloud security, mobile security, and app and platform security.

Thibodeaux told CRN that solution providers should look to partner with one another to help provide services that are outside their areas of focus. A solution provider focused on cybersecurity, for example, may want to partner with others to provide help desk services, infrastructure management and other non-core services to clients.

Several times during ChannelCon, speakers urged partners to learn as much as they can about their customers' businesses. That's because recurring revenue and subscription services change the nature of the relationship between enterprises and solution providers. "SaaS is changing the equation," said Rod Baptie, CEO of Baptie & Co., as noted on CompTIA's blog. "Today's businesses want to work with partners who understand their operations and the issues they face every day, not just IT."

"You need to have a deeper knowledge of how your customer's businesses operate beyond just, 'how are they using technology in their business?'" Thibodeaux told CRN.

Partners at ChannelCon also heard from Alyssa Fitzpatrick, general manager, worldwide channel sales at Microsoft, on the subject of successfully selling cloud services. Fitzpatrick echoed Thibodeaux's admonition to partners to find a good industry vertical and to build technical depth in a specialized industry. "Make sure you have the technical skill set in-house," Fitzpatrick said, as reported by CRN. "You have to be able to articulate the art of what is possible in the cloud to your customers."

Microsoft has put money and effort behind helping partners build vertically-focused solutions that address problems specific to the manufacturing, financial services, retail, healthcare, education or government industries, Fitzpatrick said. For Microsoft, it sets the company's Azure cloud platform apart from other, more generic cloud computing capacity providers. For solution providers, it adds value because the education and support Microsoft provides will help them solve specific business issues for enterprise customers in those vertical industries. "Our customers are incredibly demanding," Fitzpatrick said at ChannelCon, as reported by CRN. "They don't want a generic approach."