Building The Perfect Brand

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Daniel IT is a steadfast IBM partner, but gone are the days of riding on the coattails of Big Blue's multinational, multibillion-dollar brand.

Last month, the small e-commerce solution provider launched an image makeover, snazzing up its logo and tweaking its mission statement. Daniel IT added an icon to the left of its name--a globe with a computer mouse wrapped around it--and livened things up by adding some color to its logo. The solution provider also adopted a tagline: "Our business is e-business."

"Up to this point, we've been more or less an engineering company focused on implementing e-commerce with IBM WebSphere. I haven't spent much time on the company's image," says Rhett Daniel, president of Daniel IT, Madison, Ala. "Now that we're starting to stand on our own and develop our own history of successful implementations, image is important."

In the past five years, Daniel IT has grown by leaps and bounds. The VAR's revenue climbed from a mere $92,000 in 2001 to $1.8 million in 2006.

The solution provider, like so many of its peers, has come to a realization: Sure, touting big-name vendors opens doors, but creating a unique brand of your own helps you build a loyal customer base and gain independence.

For VARs, brand independence is nothing to shake a stick at.

Although solution providers admit that they often rely on their alliances with big-time vendors to win deals, they also concede that those vendors--and the high-tech industry as a whole--can be capricious.

At one time, the "M" in MTG (for Micro Technology Groupe) stood for "Mac." When Steve Katsman joined the Bristol, Pa.-based solution provider, he convinced the owners to change the company's name.

"I didn't think it was a good idea to rely on just one vendor," says Katsman, vice president and CIO of MTG. "If that company pulls the rug out from under you--as Apple sometimes does to VARs--there goes your business."

Mark Stellini, senior vice president of managed services at Stamford, Conn.-based MTM Technologies (2006 VARBusiness 500 No. 226), knows firsthand how quickly things can change in the IT business.

"Vendors are fickle," he says. "I was a reseller myself for 25 years, and I changed my vendor roster eight times. When it comes to landing deals, having a strong brand of your own is a powerful closing tool."

Size Matters

When Daniel IT was a David--a seedling operation--touting its tight alliance with high-tech Goliath IBM helped the solution provider prove its mettle.

Today, the VAR's partnership with Big Blue is stronger than ever--perhaps more so--but Daniel IT has grown up. The company has the size and strength to stand on its own and cultivate new customer relationships by itself.

"We've built out our project management and business-development staff," Daniel says. "Now we can handle the sales cycle on our own and score bigger clients."

Getting bigger, though, isn't the only way to wield clout with customers. Being an established player in specific verticals has allowed MTG, a $3 million business, to get by up to now without an emphasis on marketing.

"In the K-12 market, everybody knows everybody else, so we can usually walk right in and ask the customer what their pain points are," Katsman says. "The desktop-publishing market is even smaller than education. We have a reasonable customer base there because that's where we got our start."

As it turns out, MTG isn't alone in its reliance on word-of-mouth. According to a survey conducted last year by the Institute for Partner Education & Development (a division of the CMP Channel Group, which publishes VARBusiness), 77 percent of solution providers ranked customer referrals as a highly effective source of new business opportunities.

Still, Katsman admits that relying almost solely on referrals is getting harder all the time.

"We're struggling with this issue more and more, especially when we're trying to win a new customer in the K-12 space based on a request for proposals and not a referral," he says. "In those situations, we have to use brand-name leverage and talk about some of our partners--Microsoft, Cisco, Apple and Oki Data. The competition is getting fiercer. Referrals make up about 95 percent of our business right now, but they're not always going to be enough."

NEXT: What's in a name?