I’m filing my opinion this week from a hotel room in Atlanta, where I’ve spent the past four days participating in CMP Media’s first XChange conference of the year. I must admit, I’m stumped for a topic. Not because there wasn’t much to talk about but because there is so much going on in the channel right now that we can (and will) debate.
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I’ll spare you my managed services diatribe for now, because there’s one other major issue that had everyone at the conference taking sides, and that’s the concept of exclusivity, which somehow or another gets equated with loyalty and, more and more, is being measured by so-called attach rates.
There are staunch supporters of vendor exclusivity. Certainly, some of you have built compelling businesses that look a lot like an extension of a vendor’s sales team in that its products lead your pitches most, if not all, of the time. Generally speaking, this sort of behavior tends to be rewarded with higher margins. But the attach-rate mania bubbling up within some vendors—mainly those with larger portfolios that span multiple product categories—could blow this up.
The argument goes something like this: If you take on and represent more of a vendor’s product line, you will earn more in margin. This is certainly logical on the surface and great for partners with scale, but what about the truly wonderful partner who chooses to specialize in a single product category because that is the solution upon which his or her business is focused as a trusted adviser? Do vendors really want to penalize those solution providers who have chosen to become true experts with one portion of their technology simply because they haven’t signed up for other pieces? Because over time, that’s exactly what this strategy will do.
As various channel executives examine their attach-rate plans, they need to consider how their ecosystems of partners interact. The fact is, many of those aforementioned smaller VARs partner on engagements to extend their capabilities in areas in which they don’t have the time, money or inclination to invest. This partnering happens organically, and I’m not aware of any vendors that actually reward it monetarily, unless you count Cisco’s burgeoning Solution Incentive Program. And yet, it’s the most profound example of attach rate you can find anywhere.
What’s your attach-rate attitude? HEATHER CLANCY, Editor at CRN, welcomes your comments at email@example.com.