Welcome to ChannelWaves, the podcast where channel leaders share success strategies, best practices and emerging trends. Brought to you by StructuredWeb. Here's your host, Steven Kellam. Hey, welcome everybody to ChannelWaves. Very excited to have Larry Walsh joining us. Larry, thanks for taking a little bit of time to spend with us today. Much appreciated. Have a little time for you. Thank you.
And for those of you who don't know, Larry is the CEO and found of Channelnomics and an industry veteran for many, many years. Yeah, I thought we weren't going to talk about that. I know, but you've grown wise. You've grown wise over the years, Larry. Oh, I don't know if wise is the way I would say it. I think that's battle hardened. Okay. The whole thing today was I wanted to have a stress free, not that stressful doing this, but have kind of a fun podcast with Larry.
And we're going to do word association, by the way, after everything we've got through talking about, we're doing word association. I'm literally going to just throw out words and Larry is going to tell us what he thinks and he's welcome to do the same thing as well. And we're going to see if we can create a few wisdoms, few takeaways and have some fun when we do that. Are you good with that, by the way? I didn't tell Larry this is what we're. I'm fine. I'm fine with that. I'm game for anything.
Okay, all right, all right. So first word, AI. Overused. Okay. You have to respond with more than like three words. This is part of the game. Right. Okay, so you actually want me to. We have to have a little bit of a conversation, stream of consciousness on this. Right? A little bit of stream of consciousness would help you, honestly. All right. Yeah. No, so AI, it's highly tortured, overused and hugely transformative. Not today. I think that AI is, you know, one of the things.
This is something. One of our clients came to us because they went all in on AI and they're not an AI company. They have AI baked into their applications and it's very good and it's very effective. So I don't dispute that they are leveraging AI for the betterment of their product, but they over rotated on it and they got a lot in at first. They got the big push of the spike that comes with it. And then after a while people like going, but you're really not an AI company.
And I go, yeah, no kidding, you're not. And there's a lot of evidence that's building out there that AI is a piece of things, not the thing. The Wall Street Journal had a piece this morning talking about the difficulties companies are having in adopting AI because it's not a product per se, it is a, it is something that makes other things better. Now you can say, look at GPT and say yeah, GPT is making writers out of non-writers or making emails better, debatable.
But AI is, I think they over promise too quickly. It is going to revolutionize a lot of things. It's going to make the world a better place. It's just going to take longer than people think it's going to. And I think that when the analysts are out there saying oh it's going to do this over the next three years, yeah, could do some of that. The real stuff's still down the line. And I think that it's like everything else, it's a journey that we're going to go on. Okay.
Purpose built generative AI in a channel marketing application. Okay, that's more than one word. That's a little bit over. That is more than one word. But you also said math would not be involved. Look, and look, I'm on record as saying this about the incorporation of AI into marketing automation tools, particularly around what StructuredWeb is doing. So I'll give you guys a heartfelt and sincere plug on this.
Is that the work that you're doing in terms of incorporating generative AI into marketing automation or marketing resources is, is really transformative. It's one of these things that I remember the first time I sat down here with Daniel and this and he was walking me through your AI capabilities. This is amazing that, that you can actually create compelling content and images in different languages almost instantly.
And I actually see this is going to be one of the places where AI is going to have a real impact on channel marketing both into the partners as well as for the partners. Partners don't have time to go hunt down the latest template or the customizable white paper reports products like they don't what you're doing and others like you are doing making it a lot simpler for them to consume, create and utilize materials in marketing that is producing benefits for themselves.
You know this idea of going hunting and pecking through a portal that's going to go away. I think that that's the real value that comes out of the. Out of the AI use case. StructuredWeb has developed. Irish Whiskey? Writer's Tears every day. I mean like me you want, I had to throw, I had to throw that one out there because I wasn't sure whether your feelings about purpose built generative AI were before we
shared a glass of whiskey or after we. Oh, no, no. I mean, look, I mean, it's hard for me to talk about Irish whiskey since I quit drinking. Wait, really? Wait? Yeah, no, I ran out last night. I have to stop at the store on my way home from work. Okay. Yeah, we're going to switch back and forth. Attribution. I can't put my finger on it. Okay. Which by the way is the problem with attribution is that I'd be there for a minute.
I was like, come on, I'm having an attribution conversation twice a day. And by the way, I used to have it once a week and then it went to once a day. Now it's twice a day. At an event a couple of weeks ago in Orlando where I was facilitating a series of workshops. Channel Data Management is one of the biggest problems that we face in this industry. And a lot of it comes down to attribution is one problem because we don't know where the data is coming from. We don't know.
We don't have access to the right data. There's no company really does have a single source of truth, and that's problematic. And when people talk about channels as being overlays to an organization, it's an overlay to the sales organization or overlay to operations or whatever. It really isn't. Channels are really under and they are fragmented across these different vendor organizations.
And the ownership of the data often is not the channel that owns it, it's somebody else that owns and the channel is actually getting access to it. It makes it very hard to demonstrate that you did something or a partner did something. And in fact, one of one organization that we work with, we were talking about this and they said it's really easy for the sales team to dismiss the value of partners because even when you have the data, there isn't a partner in the room when they're discussing it.
So it's like, no, I did that. No, not the partner. Yeah, I know what it says here. But the partner says that the other problem with channel data management is people don't. Even if you have good data, people don't believe it. And, you know, you can light it up and say, this is what we all agree on.
And they will then go hunting for more because there's a huge amount of confirmation bias or recency bias that comes goes into channel analytics or at least within these teams and they go looking for more. And I have to tell people more is not better. You know, agreement is better. You know, this is what we're going to measure. This is how we're going to measure it. And we're going to accept whatever comes out on the other side.
And there isn't enough of that conversation happening in the beginning of that process. Which makes the attribution problem even harder. Yeah, we could go down this path. Right. I used to run an MDF company and trying to manage attribution to that for an ROI inside an MDF company. And now in the marketing side, this is where I'm hearing, in the marketing side. So I know we talked about attribution. I threw that as one word marketing.
Channel marketing attribution is one thing I was going to throw out as well. Because of that, I'm getting hit on more and more. It's not just do we have partners using a platform? Do we have the right partners using the platform and can we tie platform to outcome? I mean, look here, I was way more than one word. Sorry, Larry. Oh, no, but look, before we move, before we move on, MDF is MDF And attribution is an issue that comes up all the time. I gave a partner a dollar in MDF.
Six months later I see a sale. Did the MDF lead to that sale? And the answer to that question is maybe. But all kinds of other things happen in between. But. And people say, well, which one did it? I said, they all did it. It's a concert of activities and investments that result in the sale, not just one attribute. Okay, we could do one just on MDF or we should just do one on ROI and yeah Because by the way. So how different is that from channel marketing?
Oh, I had someone use your platform to run a demand generation campaign and okay. And they sold something down the road. Now we can tie in a, some sort of code to try to track it to deal registration. But once again it's, it's attribution at a fairly high level because there's a lot of other things. But people are really getting hit hard by executives right now on that, Larry. Or of marketing attribution, whether it's through channel or not. And it's a real challenge for people.
Well, look, the trend line has been the same for the past two and a half years. Channel budgets are under a huge amount of pressure, which means there has to be more justification for investment and there has to be more of a result driven from whatever is happening. And so you put those things together Is that you're, it's always going to lead to more questions on the other side, not, you know, celebrations that something worked.
Here's, here's the challenge, right, Especially in the long tail, is partners don't want to give that information as they're going through a sales cycle, even if they do that back to vendors. Right. And we could talk forever about the historical reasons for that. And it's a real challenge today until there's a trust enough that they can do that. I am seeing in the one to few the managed partners.
You know, you got four vendors and four partners going to a buyer and they're all co selling, co marketing together. That's, that's pretty good, but still a real challenge. And I'm wondering are we ever going to get to the point where, you know, partners can actually help with that attribution? Would they be giving, willing to give more of that data or how do we do that so that more of that data flows back and we can actually really manage efforts to results. Data reporting.
Data sharing is a thorny issue amongst partners because you require, first of all, it requires a huge amount of trust between them and the vendor that the data is not going to get misused or it's not going to get flipped to somebody else. One of the problems that happens is, is that the vendors will say, look, give us your data, give us your point of sales data and we're going to enrich it and give it back to you so you have better intelligence.
Well, that doesn't always work out well in terms of yes, the process will happen, but does it actually result in something meaningful? Not necessarily. The other problem though is that the partners giving the vendors more data is problematic. There's not a data sharing standard, there's not one way to do this. And I was having a conversation with a large reseller in Europe not too long ago. We're talking about this because one of their vendors had implemented this. It was a requirement.
You had to submit your point of sales data. And I think it was on a weekly cycle. This is huge. This is hundreds of millions of dollars in product being booked around. Right. He has a team of 20 people working on it. Not working on selling, not working on demand, not working in market strategy, but working on getting the data back to the vendor. Yeah, yeah, it's a huge resource strain on the partners. So you combine the trust issue with the value issue, with the, with the cost that goes into it.
That's a big burden. That's a burden of placing the partners now If I could wave a magic wand and say, yeah, we can go fix this, that would be remarkable. But it's, you know, it's, you know, it's not one of those things that's going to happen tomorrow. Okay, let's wind it down. Last one, 2025. I, you know, I wish I had an easy answer for that. So here's what I will tell you. So, Channelnomics, every quarter we publish our partner confidence index for Q4. And the basic question is tell us what
you think over the next 12 months. Yep. And partner confidence for the next 12 months is actually ticking up. So for much of 24 it's been at 10 year lows. For Q4 it actually jumped up and the trend line looks like it's going to continue to go up. We'll know more in January when we release Q1 for 25. The outlook is pretty strong, at least in North America though. North America tech spending is expected to continue to climb.
Globally, tech spending is, I think the analyst firms, they're overly optimistic to hyperbolic in terms of their projections. I mean I've seen double digit growth projections from some analyst firms like that's not going to happen, but it's going to be strong. The problem is that it's not going to be uniform. It's going to be, it's not going to be in every category.
And I think that that's where we're going to continue to see adjustments across the industry is that there's going to be like in anything else, there's going to be some winners and some losers. There's going to be products that commoditize, that don't do as well. There's going to be new products that will come on that will either take off or they'll struggle to find their place. But generally speaking, you know what I've been saying for since the beginning of '23, '23 was going to be terrible.
It was first half of '24 was going to be hard. It was. The second half is showing signs of life, better signs of life. Things are feeling a lot better. And we're seeing that not just in the, not just in the channel, but also in the macroeconomic trends. And the expectation is that we're going to continue to see good times or better conditions through '25 and '26. That's my expectation. Now that's North America and globally, Europe is a different, Europe is in a different place.
Asia is in a different place. Latin America is a mixed bag. I don't even want to talk about Africa. Europe is in a tough spot. Inflation. Inflation. The that they don't have the same economic base as we do and they have more problems than we do. Okay, the last word. Happiness. Getting to do this every day. You know, honestly, I tell this. I met somebody for the first time last week, a client, you know, one of our clients.
And they wanted me to talk with one of their new executives and I was explaining to her is that what brings me happiness is the people around me, the companies that I get to work with, my partners like Steven and Daniel at StructuredWeb, our clients at Channelnomics. I mean there's a lot of goodness but every day I wake up feeling fortunate that I get to do this. But that brings me a lot of happiness. We're pretty blessed. Yeah, we absolutely are. All right, thank you, Larry. Thank you viewers.
Listeners, have a happy day. And I sincerely mean that.