Gartner Inc. has highlighted the key trends that will impact technology vendors in 2024. According to experts, generative artificial intelligence dominates the technical and product agenda of almost all technology vendors.
However, there are new friction points in growth plans, merger points in marketing and sales, and relationships opening with technology and service providers.
“Technology is reshaping a technology provider, from its growth and product strategy to the everyday tools its associates use. Despite Gen AI’s potential to reshape vendors, it’s not the only influence technology leaders face,” said Eric Hunter, senior vice president at Gartner.
Below are the trends that will impact technology vendors in 2024, according to Gartner:
Efficient growth for high technology
Significant growth in IT spending over the past decade has benefited high-tech companies. Capturing this growth led them to pursue a “growth at all costs” strategy. However, as macroeconomic conditions create uncertainty among buyers and rising costs of capital shift investors’ focus toward margin growth, technology providers will focus on efficient growth. Effective growth strategies recognize the value of growth that strengthens current margins and future revenue opportunities.
New relationships between enterprise IT service providers
Growing business and technical demands are forcing enterprise IT to cover more ground, at a deeper level and at a faster pace, eroding enterprise IT capacity and capabilities. This creates a trend for product managers at technology vendors to create new relationships and revenue opportunities across the enterprise, including expanded vendor roles within IT and the enterprise of the business, results-focused supplier-business relationships, and enterprise-wide Tier 1 relationships.
A sustainable business is growing
Sustainability and environmental, social and governance impact management efforts have focused on mitigating internal risks and ensuring compliance. Product managers must evolve by embracing dual materiality and holistic exploitation of emerging technologies to achieve sustainability goals.
AI Security
The rapid development of Gen AI technologies has fueled debate over responsible AI and AI safety, as well as how to address growing issues such as content provenance and hallucinations. Product managers must create solutions that integrate security principles with emphasis on aspects of transparency, traceability, interpretability and explainability of models. Anticipating regulatory and compliance issues will be critical to remaining competitive in the AI generation market by creating trust.
Growing pessimism among buyers
Over the past three years, technology vendors have increasingly observed negative effects on the sales pipeline due to new buyer behaviors colliding with outdated go-to-market models. Without adapting sales and marketing approaches to detect and respond to buyer pessimism, technology providers will see their own GTM operations decline, both internally and externally.
Vertical generative AI models
Technology providers should explore industry-focused models that can be tailored to specific user needs using available resources more efficiently. Those that fail to do so will face increased costs and complexity in creating and operating models.
Personalized Market Experiences
Specialized digital marketplaces are emerging to help buyers navigate the complexity of purchasing, implementing and integrating solutions. Product managers who don’t offer their services through personalized digital marketplaces limit their visibility to their target customers. Gartner predicts that 80% of business interactions between suppliers and buyers will occur through digital channels by 2025.
Industry Cloud drives growth
Service providers, hyperscalers, ISVs, and SaaS providers are turning to vertical solutions to provide customers with the results that will drive vendor growth. By 2027, Gartner predicts that more than 50% of technology providers will use industry cloud platforms to drive business outcomes, up from less than 5% in 2023.
PLG and value converge for hybrid GTM
Product-led growth aims to show value to users of the product, creating intent signals that GTM teams can use with potential buyers. But most businesses using a PLG GTM realize that a 100% self-service GTM motion is not tenable and that sellers must be involved to convert transactions. Buyer needs for business value and outcome justification will combine PLG tactics with value management and realization initiatives in hybrid GTM strategies.
Precision Marketing and Sales
Rapidly evolving technological advancements, such as Generation AI, digital procurement, and the Metaverse, are changing the way technology providers market and sell technology. Technology providers that do not adopt new approaches will see erosion of overall transaction quality combined with loss of relevance and limited growth within established accounts.
