intersection of the channel and the cloud
DESCRIPTION
The explosion of cloud technology is dramatically changing rules for how best to manage, engage, and motivate our resellers and distributors. How we and our channels evolve through the next few years will be a critical for success.TRANSCRIPT
Ian Moyse Sales Director
Workbooks.com (Cloud CRM Vendor)
Chris Becwar Marketing & Strategic
Alliances Director CCI Channel Management
Solutions
The Intersection of the Channel and the Cloud
www.channelmanagement.com [email protected] 415.427.5100
What We’ll Cover
1. Big Picture: how cloud is transforming the biz landscape (Ian)
2. Crossing the ‘cloud chasm:’ the tricky days ahead (Ian and Chris)
3. Strategies: A new model begs for new approaches to channel motivation (Chris)
www.channelmanagement.com [email protected] 415.427.5100
Ian Moyse: Speaker Profile
• 26 yrs+ in IT, 9yrs in IT Security, 7yrs in Cloud
• Sales Director, Workbooks.com, Cloud CRM Vendor • Sit on Board of Eurocloud UK • Sit on Governance Board of Cloud Industry Forum (CIF) • Advisory Board Member SaaSMAX • Advisor to Board for Evoco ‘Journey2Cloud’
• Named by TalkinCloud one of the global top 200 cloud channel experts in 2011 • Listed on the MSPMentor global top 250 list for 2011
• Named ‘Channelnomics 2011 Influencer of the year for Europe’ • Won ‘European Channel Personality of the year 2011’ • Awarded global ‘AllBusiness Sales AllStar Award for 2010 • Thought Leader to ‘Compare The Cloud’ • Comptia Cloud Essentials Exam Certified 2012 • Worldwide SMB Nation 150 Channel Influencers List 2012, 2013 • Approved Speaker Schoolspeakers.co.uk • Runner Up 2013 Contribution to IT Award – Network Computing
www.channelmanagement.com [email protected] 415.427.5100
Chris Becwar: Speaker Profile • Director of Marketing and Strategic Alliances at CCI
o Leads marketing strategy and operations, expanding CCI’s partner ecosystem, and contributes to CCI’s consulting practice.
• Led Xora’s channel engagement with Verizon, AT&T, and Sprint while building strategic alliances with Apple, Motorola, Samsung.
• Led corporate marketing and channel relationships for GreenRoad with Qualcomm, The Hartford, Marsh, and Zurich.
• With DigitalGlobe, helped company through IPO while leading global go-to-market initiatives and building channel alliances with Oracle, Microsoft, Autodesk, ESRI, and others.
www.channelmanagement.com [email protected] 415.427.5100
Guidance At Every Step
Program Design
Program Development
Program Evolution
CCI: the Industry Leader in Incentive Solutions
Configurable SaaS Application
ROI Metrics
Multi-currency/lingual
Fund allocation
New fund set up
Approval workflows
Partner and Activity – add, deletes, changes
Email alerts
Global Program Management
Available follow-the-sun support
Partner Support
Program Administration
Claim administration
Payments
www.channelmanagement.com [email protected] 415.427.5100
Comprehensive Solution Set Distributor Reseller Sales Reps Consumer
Co-op/MDF/BDF
Streamline management of joint marketing programs
Marketing Planner
Plan marketing programs, forecast and measure ROI
SPIF & Rebates
Run short- and long-term incentive programs
Sales Performance Rewards
Reward channel partners for attaining sales goals
Trade-In Rewards
Manage incentive programs requiring physical return of goods
Opportunity Management
Deal Registration, Lead Management, Referral Rewards and Special Pricing
www.channelmanagement.com [email protected] 415.427.5100
CCI Clients
Ian Moyse
Big Picture: How Cloud Is Transforming the
Biz Landscape
Sales Director, Workbooks.com @imoyse
www.ianmoyse.co.uk
www.channelmanagement.com [email protected] 415.427.5100
xxxxxxx
www.channelmanagement.com [email protected] 415.427.5100
The World Is Changing: Movies
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The World Is Changing: Music
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The World Is Changing: Books
www.channelmanagement.com [email protected] 415.427.5100
The World Is Changing: Photography
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The World Is Changing: Postal
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The World Is Changing: IT
IAN MOYSE
IT
Ian Moyse & Chris Becwar
Crossing the ‘Cloud Chasm:’ the Tricky Days Ahead
www.channelmanagement.com [email protected] 415.427.5100
General Resale Challenges Today • Recessive market, customers burning solutions for longer
o Customers struggling themselves and more cost conscious
• Highly competitive market
• Decrease in margins available from third party commodity items
• Demand from vendors and customers for ‘certified’ channel partners o Increases in the cost of training and certification
• Increased cost of employing and finding quality skilled labour
• Reduction in the dependency of many vendors in channel and/or partner sales
• An increase in vendor direct sales via either telephone or the Internet
• Demystifying and deskilling of some common IT services putting pressure on services revenues
• Consolidation of large computing vendors
• Reduction in "value add" of vendors and distributors
• Increased competition from vendors competing directly against smaller ISVs
www.channelmanagement.com [email protected] 415.427.5100
Why Do Channel and Cloud Collide?
Financial worry over who bills the client, how its billed, what margins? Are there services? Deal values, annuity vs. up front?
Competition from vendors, cloud resellers, XSPs
‘Cannabalisation’ – New vs. existing business, renewals
People skills: How are sales people compensated, deal protection /value differentiation?
www.channelmanagement.com [email protected] 415.427.5100
Will the Channel Come Out to Play?
“More than half of resellers are not currently selling any cloud”
www.channelmanagement.com [email protected] 415.427.5100
Channels Concerns with Cloud Solutions
• Vendors having direct customer relationship
• Cannibalization of existing revenues
• Lower sales values
• No installation charges
• Is there any consultancy around the sale?
• Where’s my differentiation gone?
• Billing model’s effect on cash flow!
• Vendors know who my customers are!
www.channelmanagement.com [email protected] 415.427.5100
Channel Barriers
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Why Would You Not Sell Cloud to Customers?
www.channelmanagement.com [email protected] 415.427.5100
Benefits of Reselling Cloud
www.channelmanagement.com [email protected] 415.427.5100
Cloudy Channels Will Be Different
• New Values from Distribution o Aggregation (billing) or sell through o Broad base vs. specialist distribution values o New types of distribution relationship with ‘Cloud Focus’
SaaSMax, Cloudmore, Jamcracker, SaaS Plaza
• Resellers o Levelling the playing field for smaller resellers o Selling new vs. protecting legacy business a challenge
• XSP (ISP, MSP, etc.) o Billing models and systems already in place o Adding cloud to their portfolios
• Pure play cloud resellers / specialist teams / new brands
• Sales agents – referral partners, creating opps for vendors to fulfil
www.channelmanagement.com [email protected] 415.427.5100
Users Will Find Cloud Suppliers
http://channelnomics.com/2012/10/04/cloud-buyers-seek-partners/?utm_source=Channelnomics+Contact+Us&utm_campaign=ef3e151a77-Weekly_eNewsletter_10_08_2012&utm_medium=email
Chris Becwar Director, Marketing and Strategic Alliances
CCI: Channel Management Solutions
Strategies: A New Model Begs for New Approaches
www.channelmanagement.com [email protected] 415.427.5100
Channel Evolution and Mix
Direct Corporate reseller
Distributor
VAR Retailer
www.channelmanagement.com [email protected] 415.427.5100
Channel Evolution and Mix
Direct Corporate reseller
Distributor
VAR Retailer
ISVs
System Integrators
Direct Marketers
MSPs
Hosting/ Infrastructure
OEM
Solution Providers
www.channelmanagement.com [email protected] 415.427.5100
Channel Evolution and Mix
Direct Corporate reseller
Distributor
VAR Retailer
ISVs
Cloud Agents
System Integrators
Direct Marketers
MSPs
Hosting/ Infrastructure
OEM
Solution Providers
www.channelmanagement.com [email protected] 415.427.5100
Lewin’s Stages for Organizational Change
1. Unfreeze
• Help the partner be open to changing their behaviour
2. Change
• Move through the change process by guiding partners to adopt new ways of doing business
3. Refreeze
• Ensure the change becomes permanent and partners continually refine in the new paradigm
www.channelmanagement.com [email protected] 415.427.5100
Education: Needed Throughout the Chain
• Partners need to extend ‘trusted advisor’ status into cloud • New sales skills needed: Locus of demand is shifting away from
IT to various business units: support, finance, HR, etc. • Measurable, video-based training and certification on: o New products o New business models o New sales techniques
• Address partner concern about cash flow. Pay sales first year up front? More salary based? Individual discussion.
• More than ever, CAMs need to be trained as business consultants.
www.channelmanagement.com [email protected] 415.427.5100
Incentivization • Still too much protecting incumbent revenue by vendors
and partners!
• It’s a great time to reassess how we incentivize the channel. Time to re-orient $$ toward cloud
• MDF as % of revenue needs to change, since partners won’t get all revenue until the end of subscription period.
• More important than ever that MDF be based on an approved partner marketing plan.
• Consider a more points-based approach, targeting: o Relevant certifications o Separated P&Ls for cloud & traditional o Rewarding agent relationships o Cloud-specific marketing approaches
www.channelmanagement.com [email protected] 415.427.5100
Hybrid Incentive Models
• Avoids alienating partners whose business model better supports the traditional offering while helping them add value with a broader offering.
• Allows stability as they integrate cloud into their core offerings.
Example: Vendors get 100% of the first year subscription margin upfront, as with an on-premise solution. 10% margin on annual renewals (not offered with traditional solutions.)
www.channelmanagement.com [email protected] 415.427.5100
Incentives Based on Total Contract Value (TCV)
• Account for the total lifetime value of a new deal.
• If a reseller sells a monthly subscription for a 3-year contract period: consider an incentive structure based on the full value of the deal and pay a portion of that incentive up front.
Give partners a commission for the TCV of the subscription (price*seats*term) plus a recurring fee to incent partners to actively manage and service the account.
www.channelmanagement.com [email protected] 415.427.5100
The Rule of 78s
www.channelmanagement.com [email protected] 415.427.5100
Financing for Partners
• With economic dip, finding sources of credit is challenging.
• Help partners through the transition until the annuity model smoothes out.
• Accelerating the transition fills the ‘revenue gap’ for vendors and partners.
www.channelmanagement.com [email protected] 415.427.5100
Lewin’s Stages… Into the Cloud
1. Pre-cloud • No major change needed
2. Unfreeze • Help the partner be open to changing
their behaviour
3. Change • Guiding partners to adopt new ways of
doing business
4. Refreeze • Ensure the change becomes permanent
and partners continually refine
www.channelmanagement.com [email protected] 415.427.5100
Lewin’s Stages… Into the Cloud
1. Pre-cloud • No major change needed
2. Unfreeze • Help the partner be open to changing
their behaviour
3. Change • Guiding partners to adopt new ways of
doing business
4. Refreeze • Ensure the change becomes permanent
and partners continually refine
Up-front revenue Accrual-based rewards
Education Strategic BDF/MDF
Hybrid incentive models Points-based rewards
Growth of agent and managed services partner programs
www.channelmanagement.com [email protected] 415.427.5100
Good Reference Points
http://www.cloudindustryforum.org/
http://www.eurocloud.org
Thank You &
Questions
Ian Moyse Sales Director
Workbooks.com @imoyse
www.ianmoyse.co.uk
Chris Becwar Director, Marketing & Strategic Alliances CCI: Channel Management Solutions