An analyst has claimed the SMB market is showing signs of saturation as vendors collectively turn their attention to the sector.
ARN recently reported on a move by AMD to chase a larger piece of the SMB pie, which it regards as up to 60 per cent of its local market opportunity. The chipmaker is one of many vendors looking to move aggressively down the chain.
IDC research manager, Jean-Marc Annonier, warned such moves from vendors and their channel partners was making competition extremely tough. "Most of the SMB space is saturated and the competition there is just as high as anywhere else," he said. The greatest chance for vendors and resellers to succeed was in areas where the market hadn't been properly addressed. Annonier raised services as one such opportunity.
"I think things are getting warmer in the services industry because, traditionally, the big players have struggled to provide services to the SMB space," he said. "They just haven't had the structure or have been too expensive to attract SMBs."
Despite the buzz of activity, Gartner lead analyst, Craig Baty, said vendors had made plenty of mistakes as they sought to chase SMBs.
This was paving the way for smart channel operators.
"Some vendors tried a one-size-fits-all solution instead of looking at a real business solution," he said. "Others thought SMBs would be price sensitive on everything, but that's more of a consumer attitude. SMBs will spend money if it's justified."
So what can resellers do to attract more work within the SMB market? Baty said this group of users had specific questions that resellers should be prepared to respond to before they would sign on the dotted line. Open standards were a classic tool for any reseller hoping to crack SMB, he said.
They gave resellers the best chance of integrating with existing IT systems.
According to a Gartner study, SMBs are also extremely focused on "investment protection" and leveraging existing investments when evaluating new IT products. In a similar vein, cost effi ciency also looms large in the minds of SMB owners and is a key selling point. Any IT project that can save the business money will have a greater chance of getting signed off.
IDC's Annonier also pointed out SMBs weren't interested in cut-down enterprise software solutions.
"Some vendors have tried to repackage large suites for the SMB space and that hasn't worked so well," he said. "Some of the large software companies, such as Oracle and SAP, are getting it right by specifi cally developing offerings for the SMB space."
How services are packaged is another issue. Although they're a lucrative opportunity when done right, SMBs are savvy to potential consulting or professional services fees that might emerge from their latest technology purchase. Offerings that are easy-to-integrate can allay such concerns - and are popular in their own right.