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Netcall’s 2025 Partner Predictions: Regulation Impacts, AI and Evolving Vendor Relationships

10th of December 2024

The channel industry faced testing challenges this year in the shape of tightening economic landscapes the world over, global supply chain disruptions caused by geopolitical issues, continued pressure to modernise and be ever more sustainable, as well as the ongoing skills shortages that hamper the ability of businesses to achieve optimum performance.

But once again, the channel demonstrated its resilience and adaptability – a testament to the expertise of those working within it at all levels. However, looking ahead, the next 12 months will see more changes afoot, tasking vendors and channel partners alike to adapt once again.

Procurement regulations in the public sector

The rules and processes around public procurement will change in February 2025, once the Procurement Act 2023 comes into force. The aim of this Government move is to improve the efficiency of procurement, make the process quicker and more flexible, increase transparency throughout the procurement process and highlight, and consequence accordingly, underperforming suppliers.

However, this will likely have a significant impact on the channel. This will affect how channel partners do business with this target market, or even potentially close that market for those which don’t target public sector as a core market. With procurement becoming harder now, it may not be worth some partners targeting this sector any longer. For those choosing to step away from the public sector market, they will need to replace those revenues elsewhere.

Vendors becoming more prominent thought leaders

As the market, customer expectations and the channel itself all evolve, channel partners will lean on vendors more for high-level strategic thinking, and thought leadership. This puts a responsibility on the vendors to empower their channel partners with the sufficient knowledge and strategy needed as to how products and technology innovations are positioned, and how trends, such as AI, may impact business moving forward. Such expertise helps channel partners provide a better experience for their end customers, and ultimately help them sell more effectively.

Traditionally the relationship between vendors and channel partners has been very transactional, with vendors simply informing resellers when products need to be sold and when, but this relationship will become far more consultative, and channel partners themselves can adopt the role of trusted advisor.

The pressure of customer expectations

Across many industries, if not all, people have become accustomed to being able to access what they need almost instantly, whether that’s information or physical products – and this will only continue. Customer expectations will continue to rise. But costs have risen across the board, none more so when it comes to the cost of human workers, so it is becoming harder to service these customer demands. Consequently, we will see the increased adoption of technology, to fill this gap.

However, this transition may not be as fast or as seamless as customers expect, so companies throughout the channel will have to strategize carefully as to how they balance the deployment of people and technology, while ensuring customer service levels don’t drop. This is especially important as customer experience becomes an ever more important differentiator for channel companies.

The selling opportunity in single platforms

Channel strategies constantly need to evolve to maximise selling opportunities that follow market trends, and the increasing demand for end-to-end solutions on a single platform is picking up momentum – presenting a good selling opportunity for the channel.

From a cost and time perspective, it’s much more beneficial for a business to only have to deal with one vendor on one platform, rather than having to communicate to several vendors across several channels of communication. End-to-end solutions on one platform prevent communication and data silos from continuing, making the process far more streamlined and providing more control over costs – if a customer is compiling end-to-end solutions with several vendors, just one cost fluctuation, such as the cost of living crisis, can affect margins hugely and see them deteriorated rapidly, as individual vendors alter their pricing.

The ongoing impact of AI

Across all industries and businesses, AI is an unavoidable topic that is having a profound impact. Focusing on customer experience though, especially within the contact centre space, it has been traditionally quite hard for new companies to break into the market with the barriers of entry high in gaining ground on the traditional big players.  However, with the advent of AI putting a focus on the front end of businesses as well as being accessible to all, it has opened up the market substantially which is great for the channel.

The adoption of AI isn’t without its challenges, though. Channel partners are regularly asked by their end customers what impacts AI can have, and this is causing confusion, which has caused a scramble for channel partners to formulate strategies and fully understand how they will incorporate AI. So for vendors, it is vital that they stay ahead of the curve when it comes to AI capabilities and the functionalities they are adopting, so that partners are kept abreast of the latest innovations and how the innovations they are seeking to implement through adoption of AI.

Capitalising on opportunities amid the imposing challenges

2025 is sure to the tides changing again for the channel, with customer expectations increasing and AI adoption showing no signs of slowing down, but also many channel partners and vendors will turn to consolidation where one platform can provide a multitude of solutions, rather than several vendors providing different solutions.

As always though, challenges also present opportunities – as long as they are capitalised on correctly. To do this, it is vitally important that vendors take on a greater thought leadership role, and the relationships between them and channel partners become far more collaborative and educational, rather than transactional.