Strategic Partnerships – Diversify or Die11:35 AM EST Thu. Mar. 01, 2012
This is the final in a series of blogs from top execs at CRN Fast Growth companies. Virtual Graffiti, number 50 on our list, grew 76 percent between 2008 and 2010. Here, Ellison, Creative Director at Virtual Graffiti discusses the art of choosing the perfect partner mix. -- Jennifer Bosavage, editor.
Choosing the right partners can be a difficult task. While decisions are often market driven, resellers should build a diversified product portfolio for stability. Simply put, don’t have all of your eggs in one basket – branch out and find both competitive and complementary solutions to offer to your customers. Here are several things to review when finding new partnerships with vendors:
Big vs. Small Brands
Long established brands are first to come to mind when customers are looking to make a new purchase. With huge marketing budgets, key customer accounts and a solid product line, these big brands have many advantages over their smaller competitors. Forming partnerships with big brands allows you to quickly establish a significant customer base with the potential for huge opportunities. Sounds great right? Well, big brands also tend to have a large channel of hundreds of resellers just like yourself all fighting for those customers. Resellers also might struggle to make larger profit margins in a saturated channel.
On the other hand, smaller brands and start ups can present a fantastic opportunity to offer an alternative solution to your customer. These companies tend to have leaner business structures and can win both on price and customer account management. While smaller brands offer these advantages, customers are often hesitant to go with unfamiliar products. Resellers need to use a more aggressive sales approach to convince customers they are making the right purchase.
Everything but the Kitchen Sink
While your company may focus on a particular segment, customers enjoy a single one stop shop for their entire technology infrastructure. Complementary solutions are a great add-on sale in most cases. Selling storage? The customer might need additional networking products. Selling security? Suggest a power management solution to keep the network up and running. Having a broad portfolio also provides resellers the ability to turn smaller deals into larger ones and gives exposure to lesser known product lines with larger profit margins.
We’re in this Together
Always remind yourself that these are partnerships. Your goal is provide solutions to your customers – the partner’s goal is to sell their solution. Look for partners with a strong channel focus with multiple sales and marketing tools set up for you to find success. This includes cooperative marketing opportunities and collateral, pricelists and sales quote calculators, outside and inside sales engineers, product demos, deal registration programs, product training and certification and so on. You want to leverage these resources – especially during the early stages of the partnership. Their commitment to you will allow you to succeed.
Choosing the right partners will ultimately benefit the overall growth of your business. At Virtual Graffiti, our strategic partners have been a strong contributor to our thriving growth. We now have more than 120 partnerships with industry leading brands. While we view security as our specialty, recent complementary partnerships have shaped our business into a full IT network solutions provider. VARs can achieve similar success by reviewing these characteristics and applying them when choosing their next strategic partner.