At one of the Linkedin groups, there was an interesting discussion about SaaS in the channel. As I read through the posts it hit me that "the channel" was being used as a catch all term. The old days of VARs, dealers, systems integrators, OEMs and DMRs are long over. Heck, It was dangerous to make global proclamations about "the Channel" in those days, now look out. SaaS and cloud computing are the blame for some of this diversity. Heck the iTunes App Store is extending the reach of the vendor and eliminating partners from the software sale.
If you're not confused, you're not paying attention.
....... Tom Peters
Okay Tom we are paying attention, but what does it mean? Partner selection is critical. It always has been but now if you try to sell a SaaS product through a IT VAR channel, disaster is looming. IT VARs typically sell to the tech side of the company where as the SaaS decision is driven by the business side and can be viewed a threat by the IT department. I had this unfortunate experience during the early days of SaaS, we had a wonderful set of resellers to whom we proudly introduced our newly acquired SaaS service. They were thrilled with the features of the service and how it fit our product family, etc. However, the reward was sluggish sales and upon investigation we discovered that very discontinuity, ugh.
Beyond the quintessential analysis of a partner's technical capabilities or vertical expertise or geographic coverage one is well served to understand where in the enduser organization the partners have relationships and is that a match for your product/service. This is something that your team will have to dig deep for. I suggest that the subject be addressed covertly, ask about how a typical sale is consummated by the VAR's sales people. Who did they present to, who made the decision, etc.
Okay, who do you sell your SaaS product to? Managed service providers(MSP), VARs with an MSP department, hosting companies who are reaching toward the end user, even disti's with SaaS divisions. Managed service providers come in many flavors and are typically a nice fit for SaaS partnerships. However the challenge with MSP's is that they typically offer a limited number of services and few directly competitive products as it makes no sense for them to offer a wide choice. There is an integration challenge as many strong MSP's have a portal that they present to their customers with all of the service they offer. Your product will need to be part of this portal. As importantly, these MSP's have billings systems into which the service must fit. It can be hard to get started with an MSP but unlike a VAR once your service is in, it stays in the offering without much competition.
VARs with an MSP division are quite seductive. They can sell products and deliver managed services. True in some cases, a pipe dream in others. One ugly secret with a number of these VARs turned MSP's is that they have defined the old "break/fix" service as a "managed" service and that is not going to help them sell a SaaS service. Look under the covers.
Some hosting companies have decided to provide services directly end users as well as to MSP's. It is not clear yet as to whether that is a winning combination or not. Engage these type of folks with your eyes open.
Next up are the Disti's. Most of these firms have designs on the SaaS revenue stream. Ingram Micro seems to be in the lead with their Seismic division. According to Ingram:
Seismic is an exclusive Ingram Micro managed services portfolio that helps MSPs quickly and easily leverage and deploy a broad array of managed services, enabling them to manage technical labor resources more efficiently, build and sustain recurring service revenue streams, improve service levels and customer satisfaction and increase profitability.
While I don't have experience with the division, it is at least well thought out and sounds good on the web site.
Lots of choices, certainly more to come as cloud computing takes hold. It makes the job of channel development that much more challenging.
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