Best-Seller Practices

The most powerful and compelling data from this week's Channel Best-Sellers report, featuring the technology vendors with the dominant U.S. dollar volume sales through distribution in 2006 as reported by The NPD Group, is the best practices among these top-of-the-class performers.

STEVEN BURKE Can be reached via e-mail at sburke@cmp.com.

You don't get to the top of the channel heap without superior programs, policies and practices. And of course, once you make it to the top, there is the matter of staying there. Indeed, a close look at the numbers, part of NPD's Distributor Track service, which includes aggregate results from the Global Technology Distribution Council, show which channel kingpins are losing some of their channel luster. (Are you listening IBM and Lenovo?) Take note, sports fans. Here are three best practices that separate channel giants from also-rans:

• Price parity for solution providers competing against large e-tailers/direct marketers or vendor Web sites: Best-sellers protect independent solution providers selling a robust multivendor solution with deal registration, minimum advertised price (MAP) policies and other best practices.

• A balanced channel portfolio: Best-sellers are not overweighted in one channel segment to the detriment of another. The biggest mistake being made in the channel right now is by companies playing to the commodity product segment that are overinvesting in the direct marketer, online e-tailer segment (that includes their own costly Web stores) or the retail market. (That means you, Microsoft.)

• Don't be satisfied with second best: For those that think the channel is a passive game, take a close look at Cisco. These guys are never satisfied. They play for the biggest and broadest channel share, and they are always willing to take a risk and reward partners that make the Cisco investment.

What's so maddening is how many companies do not view the channel as a strategic priority. For these vendors, the channel is an afterthought with little or no commitment or oversight from the CEO. Take a look at how much time and effort Hewlett-Packard Chairman and CEO Mark Hurd (who may be the absolute best in this business at driving operational improvements) puts into getting his channel right.

For those interested in turning it around, the first step to recovery is recognizing you have a channel problem. That means committing to planning, building and executing a channel plan aimed at making you a best-seller.

Who do you see as the worst sellers?
Send your thoughts to sburke@cmp.com.