by Dede Haas & The ASCII Group
Getting the take – and maybe a little advice – from members of The ASCII Group on what solution providers are thinking and doing on a range of important channel topics.
How Valuable Are Vendor Incentives?
Source: Channel Executive Magazine
By Dede Haas, CA-AM, Channel Sales Strategist, DLH Services, LLC
Award-winning, high-tech sales professional and founder of DLH Services, LLC, Dede Haas creates innovative and successful channel sales solutions for vendors and their channel partners. This month, Haas discusses the value of partner programs with two members of The ASCII Group, a 1,300-member organization of North American VARs, solutions providers, and MSPs offering services to help its members grow their businesses.
|JOSHUA LIBERMAN is president of Net Sciences. Since 1990, he has built, secured, and managed hundreds of networks. As a Novell CNE and, later, a Microsoft MCSE and CISSP, he has built Net Sciences into a provider of comprehensive networking, systems integration, and MSP services in three states.||TIMOTHY GUIM is president and CEO of Sewell, NJ-based MSP PCH Technologies, which he founded to serve the Philadephia market after graduating Drexel University in 1997. His firm focuses on high-quality IT and cyber security solutions to ensure their client systems are always secure and performing optimally.|
QUESTION 1: Are vendor incentive programs (MDF, co-op, spiff s, rewards) valuable and important to the partner community?
LIBERMAN: They’ve been really valuable to us over the years. A common off ering is MDF and most vendors will chip in at least 50 percent of the cost. We hosted a large event in New Mexico and one of our vendors inadvertently paid the entire $4000 cost. When we tried to reimburse them, they said “don’t worry about it.” Every vendor that I see at the shows will tell you that they frequently have unspent MDF funds every single year, and they just can’t get their partners to use enough of them.
GUIM: These incentive programs can be very valuable, but it depends on the partner. Not all partners fully utilize the incentives, or they just don’t know about all the opportunities that are available to them. An incentive that is important is the MDF funds; they can be very valuable. Spiff s are OK; they’re just giving you a little bit of extra money, but I think MDF funds are the most important incentive programs out there.
QUESTION 2: What have been your experiences with incentive programs?
LIBERMAN: One vendor used to have an excellent incentive program, as part of a fabulous partner program. It was like using a cash-back credit card, returning roughly 2 percent of total spend. It later morphed into something of a debit card; the payback got smaller and smaller, until they actually canceled it without notification, “stranding” points on the card. This degradation was rapid and profound, and mirrored by the overall collapse of their partner program. From poorly outsourcing tech support to the sudden retirement of all partner reps, they utterly abandoned the channel. Our call was not very important to them.
GUIM: In December 2016, we had a prescreening of “Star Wars: Rogue One.” We partnered with Cisco Meraki, D&H, and Datto for this event who provided MDF funds. It was such a great success that we did the same thing again December 2017, with “Star Wars: The Last Jedi.” For this film we partnered with Cisco Meraki, D&H, and Autotask for MDF funds. There were about 180 people who attended each event. Over the last two years, we have been able to show return on investment with the MDF by converting appointments from the events to actual sales.
The ASCII Group is a vibrant reseller community of independent MSPs, VARs, and other solution providers. Formed in 1984, ASCII has more than 70 programs that provide turnkey cost-cutting strategies, innovative business building programs, and extensive peer interaction. ASCII members enjoy benefits such as marketing support; educational information; group purchasing power; increased leverage in the marketplace; and multiple networking opportunities. These programs enable ASCII members to increase revenue, lower operating costs, and grow service opportunities. ASCII is the oldest and largest group of independent information technology (IT) solution providers, integrators and value added resellers (VARs) in the world. Learn more at www.ascii.com.