Channel Mechanics

Why Artificial Intelligence (AI) is Set to Become a Channel Chief’s Go To

Channel Mechanics

AI and the Channel

One of the ways channel chiefs will simplify the complexity of managing his or her channel is by introducing and taking advantage of artificial intelligence (AI).

Merging multiple sources of data to track key performance indicators will eventually become more dynamic and predictable. For example, when we think of channel management, topics such as product lifecycle management and ideal partner characteristics arise. With AI, these silos of information can be merged to identify patterns and make instantaneous recommendations, resulting in both better forecasting and, just as critically important, a better partner experience.


Another area AI can help a channel chief is selecting the optimal distributor and identifying which channel partners have the best skills or potential to sell your service, solution, or product. One key step to assessing which distribution partner is the right fit includes looking at the product three-dimensionally.


For example, channel chiefs can use AI to learn more about the sales cycle and influencers. This includes answers to questions such as: Is the product the center of gravity or the periphery to another product?  Is the product back-end loaded during the fourth quarter due to the holiday season?  Whether the product propelled by federal mandates or grant funding?  Is the product tied to a certain vertical market?


Finding the Answers

When it comes to assessing existing and identifying new channel partners, AI can be used to determine which channel partners have the propensity to meet revenue targets, what resellers are best at selling higher-margin warranty and financial services, and which partners have the ability to expand into new geographies.


Many of answers to the aforementioned questions are in separate back-end databases tracking internal metrics such as operating margin that need to be fused with statistics from the Bureau of Labor Statistics, Census Bureau, Federal Reserve, Department of Education, Federal Communications Commission, annual reports from partners, databases from industry associations, syndicated research to track sales through the channel (e.g. The NPD Group), and much more. All of these statistics combine to help create a score that the channel chief relies on to target marketing efforts and any associated incentives.


For example, if a power vendor is looking for key partners in territories to sell backup power, they may want to take into account age demographics so they can plan to hire account managers and recruit resellers in those areas that are building more hospitals or dialysis centers needing critical power.

Another scenario that might help the channel chief is tracking book-to-bill ratios of its semiconductor partners to see if shortages may occur due to a seismic event or a raw material shortage.


Lastly, from a key performance indicator perspective, AI will also dynamically analyze which partners have the propensity to sell certain products in situations when overbuilds occur or when the chief financial officer needs to grow their company’s margin base by selling warranties or leasing services.


AI will offer channel chiefs and their channel account managers better metrics to identify not only the best partner for any given campaign, but also more effectively leverage the channel in their most critical times of need.


About the Author

As The NPD Group’s Director of Industry Analysis for Channels & Commercial Technology, Michael Diamond offers expert analysis and commentary about the shifting commercial market. Through his focus on driving deeper insights with clients, Michael is improving core B2B services and helping B2B and B2C clients navigate the channel more effectively.

Prior to joining The NPD Group, Michael worked for Ingram Micro for 17 years in market intelligence, competitive intelligence, worldwide strategic planning, business intelligence, and North American strategic development. During his time at Ingram Micro, Michael was responsible for analyzing the global competitive and industry landscapes which included industry foresight on long-range trends in the IT supply chain which included technology, direct and indirect channel shifts, vertical and sub-vertical markets, demographics and more.  Michael also presented at vendor and customer-facing events to share industry insights.

Michael is also highly leveraged by vendors and channel partners for industry keynotes on the current and future of technology, small business trends and the state of the IT channel.  Most recently he presented at The Channel Company’s XChange on Cybersecurity, SanDisk’s Premier Partner Exchange, Essendent’s Technology Showcase, Tech Data’s Advanced Technologies Symposium, Synnex’s System Builder Conference and D&H Distributing’s Annual Field Sales Meeting.

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