Understanding Channels - a presentation

8/13/2019 Understanding Channels - a presentation

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Understanding Our Partners

A presentation on working with partners and Blue Coat

S. P. Dhar


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Objectives

Understand:

The dif ferent ty pes o f resel lers

Why there are different resellers

What are the mos t common/succ essfu l resel lers for

Blue Coat Systems and wh y

How resel lers dif ferent iate themselves

How resel lers are struc tured

What motivates resellers

Which resel lers to use when


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Getting the most out of our partners

TakingActions

Agreeing onPlan

Products /services

to sellGettingResults

Formal &

Informal

Blue CoatSystems

&

Partner

Blue Coat Systems

&

Partner

SettingGoals

Blue CoatSystems

&

Partner

Channel Strategy

Comprehensiveunderstanding ofyour partners

Impacts on al l aspects


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The 4CsNeed to address to ensure partners succeed

CoverageFocus on the right:

CustomersIndustriesSolutionsRun-rate vs projectbusinessValue proposition/differentiation in those

segments

CapabilitiesThe right skills, attitudes, and

knowledge in:sales, marketing, technical,finance, operations, andmanagementhow they relate to theirtargeted customers

Capacity

Sufficient amount of resources:especially financeSalesMarketingand technical

CommitmentAllocate resourcesMotivate resourcesManage resources

CapabilitiesCapacityCommitment

Coverage


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The 4CsWhat the resellers need to provide

CustomerBase

Sales

Infrastructure

Valueproposition

Differentiation/Strategic Control

Products

ServicesEnd users

Capability

Right skills,knowledge, tools,

resources

Capacity

Enough skills,knowledge, tools,

resources

CoverageRight customers and value proposition

CommitmentAllocation,

motivation, andmanagement


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Types of resellers

Value add resellers

Network ing resellers

Systems integrators

Secur i ty VARs

Telcos/service providers

Global Systems Integrators

Product resellers

Retailers

ISVs (independent software vendors)

Outsourcing

Influencers

Consul tants


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Why are there so many different types?

Different Products and services Customers

Infrastructures

Differentiation Business models


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Different product and services

Different combinations of products and services require different types of

resellers

Legacyintegration

BusinessApplicationConsulting

ProjectManagement

Price

Availability

Simple

installat ion

Installation

Ease ofordering

Maintenancecontract

One stop shop

TrainingStaging

Complex Transactional

Large

installat ion

UniqueHomogeneous

Upgrade/refresh

PriceAvailability

Device

Ease ofordering

One stop shop


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TechEnthusiasts

SkepticsConservativesPragmatistsVisionaries

System IntegratorsValue Added

ResellersMulti

ChannelsLow costchannels

Product life cycles and types of buyers

Over the life of a technology, the types of buyers change

So do the resellers who will be successful

Revenues


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Partner business model

We need to understand the basic business model of our

partners

Customer

Base

Sales

Infrastructuresells, delivers, supports, collects, administers

Value

propositionDifferentiation/

Strategic Control

Financial Model

Blue Coat Systems

Product

SALES

CLOSE thesalesMANAGE the

customers

MARKETING

GENERATE theleadsand

competitivepositioning

TECHNICAL

IMPLEMENTandSUPPORT the

sales

FINANCE

FINANCEthesales

MANAGEMENT

MANAGETheorganization

OPERATIONS

DELIVER/SUPPLYProducts

SALES

CLOSE thesalesMANAGE the

customers

MARKETING

GENERATE theleadsand

competitivepositioning

TECHNICAL

IMPLEMENTandSUPPORT the

sales

FINANCE

FINANCEthesales

MANAGEMENT

MANAGETheorganization

OPERATIONS

DELIVER/SUPPLYProducts

Low

High

Price

Performance

High

Low

16.74%11.47%

2 0 04 2 0 03

1 5 .1 9 1 4 .5 9

2 0 0 4 2 0 0 3

2 4 .0 2 2 5 .0 2

2 0 0 4 2 0 0 3

5 .5 1% 5 .4 1% 4 .4 0% 4 .6 2% 3 1. 18 3 0. 92 4 3. 54 3 9. 64 5 0. 70 4 5. 54

2004 2003 2004 2003 2004 2003 + 2 0 0 4 2 0 0 3 - 2 0 0 4 2 0 0 3

DSOInventory Days

Returnon

WorkingCapital

DPO

Working

CapitalTurn

Working

CapitalDays

Gross Margin

OperatingMarginX

1.10%

2004

0.79%

2003

-

CostStructure

Small and Medium

Companies

SMB(


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DifferentiationPrice vs. performance

Differentiation ultimately drives a partners infrastructure

and their requirements from Blue Coat Systems

Low

High

Relat ive to com pet i t ion

Price

Performance

High

Low

Value Partners

Very strong

technical services

Customer intimacy

Walmart/CDW

Strong transactionalskills

Generally in commodityproducts only

Or in cross-subsidized

Traders

Very price pointedAppeals to limited marketif alternatives exist

Monopolists

Usually occurs only if

there is some type ofmonopoly (e.g. 1 partner ina territory)

Generally to be avoided


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Infrastructure

It sells, deliver, supports, collects, and administers

All of these processes are key, but Sales and Marketing are the most important

Key is to understand capability, capacity, and commitment

SALES

CLOSE the sales

MANAGE the

customers

MARKETING

GENERATE the

leads and

competitive

positioningTECHNICAL

IMPLEMENT and

SUPPORT the

sales

FINANCE

FINANCE

the sales

MANAGEMENT

MANAGE

The organization

OPERATIONS

DELIVER/SUPPLY

Products

SALES

CLOSE the sales

MANAGE the

customers

MARKETING

GENERATE the

leads and

competitive

positioningTECHNICAL

IMPLEMENT and

SUPPORT the

sales

FINANCE

FINANCE

the sales

MANAGEMENT

MANAGE

The organization

OPERATIONS

DELIVER/SUPPLY

Products


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How Resellers Sell

Inbound/outbound

salespersonWebsite

Inbound/outboundsalesperson


Technical person



Technical person

Operations

Vendor

Wholesaler

Prospecting

Call/contact Salesperson

Prospecting

Call/contact

Qualifying Outboundsalesperson

Qualifying

Outboundsalesperson

Technical personPre-sales designPre-sales design(generally little)

Proposing ProposingOutboundsalesperson

Close saleOutboundsalesperson

Close sale

Deliver

Operations

Vendor

Wholesaler

Deliver

Install Technical/vendor Install

Technical/vendor

Support TechnicalSupport

(not frequent)

Technical

VARs Product Resellers


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How Resellers are structured

Marketing manager Operations/technicalmanager

Purchasing manager (maynot exist)

Sales manager

Biz development/product manager

Sales specialists/sales engineer

Reseller sales rep Purchasing/buyer

Awareness campaigns

Visits

Call to action (l imited)

Visi ts w ith

salesperson

Secure best price

Organize shipping to

end user

Visits/calls

CEO

Customers


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The sales squareHow resellers make sales happen

Marketing

Technical

Sales

Purchasing /buyer

Provide techn ical

in fo

Assist in pre-

sales design

Provides street informat ion to product manager

Sales forecast

Product and p rogram awareness

product knowledge

Pric ing support

Order admin

Provides street

informat ion to product

manager

Sales forecast

Purchase

requirements

The linkage between the different parts of the organisation

are critical for success


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CAM reseller focus

Marketing managerOperations/technical

managerPurchasing manager (may not

exist)

Sales manager


Sales specialists/sales engineer

Reseller sales rep Purchasing/buyer

Awareness campaigns

Visits


Visi ts with

salesperson

Secure b est pr ice

Organize shippin g to

end user

Visits/calls

CEO

Customers

CAM Focus

The people who make/

inf luencesales mos t


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The sales squareHow resellers make sales happen

Provide technical info

Ass ist in p re-sales

design

Marketing

Technical

Sales

Purchasing/ buyer

Provides street inform at ion to product m anager

Sales forecas t

Product and p rogram awareness

product knowledge

Product manager puts pressure on purchasing to

manage stock to m aximize fi l l rates

Pr ic ing s uppor t

Order admin

Provides s treetin format ion to product

manager

Sales forecast

Purchase

requirements

The linkage between the different parts of the organisation are

critical for success


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CAM distributor focus

Marketing manager Operations/technical manager Purchasing managerSales manager


Sales specialists/sales engineer (VAD)

Distributor sales rep Purchasing/buyer

Awareness campaigns

Visits


Visi ts w ith

salesperson (VAD)Secure best price

Manages stoc k levelsVisits/calls

CEO

ChAM Focus

The people who make/

inf luence

sales mo st

Reseller


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What Motivates Partners?

Understanding what the channel needs


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What Motivates Partners

3 types of people need to be motivated all 3 need to be motivated & aligned to ensure sales

Blue Coat Systems Inc. PartnerSales Organisation

Sales RepSales

ManagerGeneralManager

So What

Try to understand what motivates each type of person in theorganization


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What motivates a general manager/company

Profit

-Gross profit-Expenses

Switching

costs- sunkinvestment

Indirectrevenue-traffic

generator-bundled with

otherproducts

Direct

Revenue$Growth

Risk

(trust/consistency)

Relationship

-Emotional-direction

Alignment of

futureobjectives

Ease of doing

business/selling

The value propositionthe reasons why Partners sell Blue Coat Systemsvaries

Partners often have numerous reasons Priorities vary by partner

Status/credibility

HighLow

Usual degree of importance

So What

Do not assume that each reseller is the same. Explore their

requirements

Most frequent

Veryimportant

when tryingto convert


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What motivates a sales manager and sales person

Compensation!

Commission is 25%-75% of total package Usually based on achievement of:

revenue or gross profit targets

sometimes gross margin $/INR

May have to meet targets by vendor but often canshift sales between vendors

Being easy to sell AND win is critical

So What

Try to find out how the sales manager and sales people view BlueCoat Systems contribution to his compensation


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Motivating others

Product/business manager Usually substantial commission/profit base

Similar to sales people

Technical people Like vendors that have interesting products

Prefer vendors that can offer good support resources


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Summary

Topic So What

The key drivers of partner successgoals,plans, actions, and resultsrequire thatChAMs engage with their partners in a waywhich is relevant to the partner

In order to engage with your partnereffectively and efficiently, you need tounderstand your partner.

Partners come in many different forms,

with great variety in the 5 elements of thebusiness model

Types

Products/services sold

Target customers

Business models

Differentiation

What motivates them

Use the business model to understand

the differences between your partners

Dont assume all

partners behave

the same

Understanding Channels - a presentation

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