Prakash Krishnamurthy, Founder & CEO of Impetus Consultancy and Advisory, highlights the revenue imbalance niche cybersecurity vendors face in the Middle East due to distributor prioritization. Impetus bridges this gap by helping vendors establish a strong market presence while empowering distributors and resellers to maximize profitability.
What is the biggest challenge niche cybersecurity vendors face in the Middle East?
One of the biggest challenges faced by niche vendors from various countries is the imbalance in revenue distribution through regional distributors. These distributors, tasked with leveraging their extensive networks to promote vendor products, often find that 80% of their revenue comes from just 20% of the vendor companies. This leaves the remaining products in their portfolio neglected without a strong sales pipeline being developed. For instance, if a distributor carries 20 products, typically 4-5 of them generate the majority of the revenue, while the rest do not receive adequate attention.
Despite efforts to refocus sales teams, the disparity persists, resulting in an indirect loss for the distribution community, who miss out on potential higher growth and profitability.
However, I think the industry and end customers feel the greatest loss, and they miss out on the advantages of emerging technologies. Despite being launched, these innovations often fail to capture the attention of prominent companies. Each new technology must get a fair chance to be thoroughly examined and evaluated by end customers.
How does Impetus address this challenge of the industry?
At Impetus Consultancy and Advisory, we act as the catalyst, bridging the gap between vendors, distributors, resellers, and end customers.
We introduce new and upcoming technologies that can significantly reduce cybersecurity expenditures, benefiting both the industry and customers. We support distributors by helping their sales teams build robust pipelines for these innovative technologies. We also assist resellers in achieving better profitability through our dedicated support and sales expertise.
We are committed to helping vendors establish a strong market presence in the Middle East.
What is your approach to enable success for niche players in the region?
We aim to offer a golden opportunity to companies worldwide, helping them make a grand entry into the Middle East market. We strive to collaborate with CEOs, MDs, and senior management teams to grow their businesses. Our wholehearted intent is to support the entire sales fraternity in achieving 100% of their sales targets.
Our strategy involves collaborating with industry leaders to build a thriving business ecosystem. With our expertise, experience, and understanding of technological complexities, our discipline is to Build, Empower, Lead, and Win.
What emerging cybersecurity trends do you see in the region?
The rise in cyber attacks across the Middle East, particularly in the UAE and Saudi Arabia, has led to an increased focus on defensive technologies like VAAPT, IDAM/PAM, EDR, SIEM, and data security. Emerging trends include CNAPP, API security, IoT, and GRC, as organizations seek to bolster their cybersecurity posture in the face of evolving threats.
How do you see the role of IT distributors evolving in the cybersecurity ecosystem, especially with the rise of cloud marketplaces and subscription-based models?
The rise of cloud marketplaces and subscription-based models is challenging the traditional role of IT distributors in the Middle East cybersecurity ecosystem. Large cloud providers like AWS, GCP, Microsoft Azure, and OCI are now directly collaborating with end-customers, offering resilient and secure platforms with comprehensive support services.
To remain relevant, traditional distributors must scale up their knowledge and expertise, and associate themselves with these cloud giants. While on-premises solutions still have demand, especially in countries like Saudi Arabia, Kuwait, Oman, and Qatar, the rapid cloud adoption will make it a necessity for every company in the region.
Distributors with a traditional mindset will need to adapt and evolve their business models to stay competitive in the changing cybersecurity landscape, leveraging the opportunities presented by cloud platforms and subscription-based services.
What are the most critical factors for building strong vendor-distributor relationships in the cybersecurity sector?
Building strong vendor-distributor relationships in the cybersecurity sector requires a delicate balance of investments and time. Assessing the effectiveness of a cybersecurity vendor’s go-to-market (GTM) strategy within a channel-driven distribution model in the Middle East requires a nuanced approach. Traditionally, channels have been the primary demand generators for technologies in the region.
However, vendors often enter the market without conducting thorough research and analysis, relying on hearsay about the market’s high potential. While the Middle East is indeed a lucrative market, it also requires significant customization and adaptation to cater to the unique needs of different sectors:
- Government customers may require Arabic interfaces
- Banking, finance, and insurance sectors need highly feature-rich, agile products with flexible support services
- Oil and gas companies seek tools that provide visibility and scalable solutions for their geographically vast infrastructure
- Healthcare industry requires customized offerings to maintain robust security posture
- Manufacturing and enterprises need simple, economical, and easy-to-deploy cybersecurity products
Vendors must conduct due diligence to assess whether their products fall under the “Must-have,” “Need to have,” or “Nice to have” category for the target market. This exercise will help them enter the right market at the right time with a well-informed GTM strategy.
Effective collaboration with channel partners, understanding their needs, and aligning the vendor’s offerings accordingly are critical for success in the channel-driven distribution model of the Middle East cybersecurity landscape.
What advice would you give cybersecurity startups looking to scale their distribution and business development efforts in highly competitive markets?
Distribution companies have demonstrated impressive growth and adeptness in this market. Some have scaled rapidly to exceptional heights, serving as great inspirations for the industry. Despite the market’s competitiveness, the potential far exceeds that of all the competitors combined. Opportunities abound, waiting to be seized. Companies must act swiftly to capitalize on these opportunities and achieve business success.
Polaris Market Research anticipates cybersecurity to generate an estimated revenue of USD 32.39 billion by 2032 in the Middle East. So, an opportunity is on the table – they need to move fast and pick them up to succeed in their business.
