IT manufacturers and software developers are demanding more from their channel partners. Whether they call them specializations, competencies or authorizations, nearly every major IT vendor, from Oracle to Cisco to Microsoft, is setting the bar ever higher for solution providers to qualify as resellers. Isn't it time partners demanded more from their vendors in turn?
The 2012 Partner Program Guide offers solution providers the information they need to evaluate IT vendors they already work with or are considering working with. The guide is based on detailed applications vendors submitted outlining all aspects of their partner programs. UBM Channel Research crunched the numbers and designated some programs as 5-Star Partner Programs.
The 5-Star Partner Program rating recognizes the elite subset of Partner Program Guide vendors that give solution providers the best partnering elements in their channel programs. The 5-Star rating is bestowed on programs whose overall rating is among the elite segmented by company size: enterprise (annual revenue of more than $1 billion), midsize (revenue between $100 million and $1 billion), small (revenue less than $100 million) and emerging companies (founded in 2006 or later).
The vendor applications also offer a snapshot of the current state of IT vendor partner programs and provide some insights into channel trends.
Take the number of vendors that offer service and solution-selling training to help partners boost their services-attach rates, for example. Less than three-quarters (73.6 percent) of all vendors offer such training, down from 81.0 percent in 2011.
Vendors, nevertheless, generally continue to help partners transform their businesses and expand into new markets. More than two-thirds (67.5 percent), for example, offer information to help VARs break into vertical markets. Training and advice to help VARs incorporate cloud solutions into their offerings are provided by 64.4 percent of vendors. And 49.1 percent of vendors provide business transformation training to help partners expand their service offerings, while 47.2 percent offer training for hosted and managed services. In all cases, vendors with 5-Star programs were more likely to offer such assistance.
NetSuite, the developer of cloud-based ERP, CRM and e-commerce applications, has expanded training to help partners boost their professional services and project management skills, said Craig West, channel sales vice president. That's needed as solution providers move beyond selling and marketing cloud solutions and get into full implementation mode.
"That's the big one right now," he said. "Revamping the delivery, the professional services side. That takes some of the burden off them and helps partners keep up with some of the growth they're experiencing."
NEXT: A Closer Look At The Numbers
The PPG applications also offer some telling statistics for the channel. In customer spending for attached services, this year 7.4 percent of vendors said their programs generated more than $10 in services for every dollar of product sold, up from 4.9 percent in 2011. At the other end of the spectrum, 31.9 percent of vendors reported that customers spent less than $1 on services for every dollar of product sold through their channel program this year, down from nearly 37 percent in 2011.
The applications also illustrate the rising fortunes of solution providers as the economy improves. Asked how much their channel partners' businesses have grown in the past 12 months, 20.2 percent of vendors said their partners experienced growth rates between 11 percent and 20 percent, while 19.7 percent of vendors said their partners grew between 20 percent and 30 percent. Those numbers represent significant increases from 2011.
The 5-Star Partner Program Guide is assembled by UBM Channel Research using a methodology it developed for assessing information provided in vendors' PPG applications. The objective criteria include vendor investments in program offerings, partner profitability, partner training, education and support, marketing programs and resources, sales support and communication.
The methodology enables the research team to generate a prioritized list of vendors based on scores from their responses to a series of questions in the PPG application. A proprietary weighting scheme is assigned to each section, question and response set. Vendor responses to each question included in the analysis determines a vendor's overall rank in the 5-Star scoring process. Each year the scoring threshold used to determine the 5-Star status is determined by the responses received and scores achieved by the entire PPG applicant pool.
To dig into the 2012 Partner Program Guide, visit our PPG database.