Building The Perfect Brand
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 and 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?
Shakespeare's quixotic Romeo Montague may have had a point when he said that a rose retains its floral essence no matter its name. But that's not necessarily the case when it comes to brand identity and marketing. Sometimes a company's moniker no longer matches its mission statement. At other times, a name just needs more oomph.
In 2005, ComputerRepair.com watched opportunity grow and its business model change as a result. The operation, which, up to that point, had deployed IT experts to fix people's computers, hired BrandEquity, the brains behind such famous logos as Kodak's, Staples' and Kmart's, and, most recently, the company that dubbed Firedog, Circuit City's home-electronics service.
Brainstorming ensued. Employees were called upon for their input. Executives put their heads together. And in just 45 days, a new identity was born.
Today, that company's name is OnForce, an online marketplace of solution providers and independent technicians.
"The market had evolved beyond just repair. Now service buyers wanted network installations, national rollouts, VoIP and POS solutions. We were painted into a box based on our name," says Paul Nadjarian, senior vice president of marketing and product at New York-based OnForce. "'OnForce' tells the story of who we are--on-site, on-demand, online and on your terms. Hit the green 'Go' button to execute, to get access to the power of our marketplace."
MTG, too, has put a lot of thought into coming up with just the right name. The solution provider changed its identity not once, but four times. In 1992, the Computer Architecture Business Center became the Mac Technology Groupe; around 1997, the "Mac" became "Micro." A few years later, the VAR tried on Complete Convergence for size, and now it's gone back to Micro Technology Groupe--MTG for short.
"It was about 10 years ago that we changed our name to what it is now, and we still have to remind long-time customers that we can sell them a PC-based system instead of a Macintosh," Katsman says. "It took a lot of effort to break that stereotype, and we're still struggling with it to some extent today."
High-Touch Marketing
You can e-mail all you want, and make as many phone calls as the copper will bear, but chances are you won't be nearly as successful at pleasing existing customers and winning new ones as you'll be with high-touch tactics.
Try doing what InCentric Solutions does: Buy a box at a local ball game. Take your clients to lunch. Clear your schedule for some face-time with customers. Give your interactions a personal touch and customers will thank you with more purchase orders.
Of course, that's not to say you shouldn't pick up the phone to call prospects.
Troy Webb, chief marketing officer at Morrisville, N.C.-based InCentric, says the solution provider has enjoyed success by "narrowcasting." That's how he refers to the process of cold-calling a finite number of prospective customers to talk to them about high-tech trends and pitch them on what the solution provider can do to boost their business.
Webb relies on an unlikely cadre of people to take on the task. "Every month, we give stay-at-home moms a canned script and a list of about 500 prospects," he says. "For every 200 calls or so, we get about five responses and two follow-up appointments that lead to account wins."
Webb says he devises scripts based on trends he reads about in trade publications. For example, when President Bush signed into law the Energy Policy Act of 2005, extending Daylight Savings Time by four weeks starting this year, Webb told his cold-calling crew to ask prospects what the legislation might mean for the maintenance of servers that perform automated updates at prescheduled times--and what InCentric might be able to do to help them out.
Today, the solution provider is working on closing three deals as a result of that pitch.
NEXT: Services are the name of the game.
To Ania Levy, president of Levy LeGette, an IT-contract negotiator based in Cherry Plain, N.Y., it's no surprise that many solution providers choose to lead sales calls by touting the names of their well-known vendor partners.
"Of course VARs are leading with 'I'm a Microsoft reseller.' In many cases, they simply don't have a brand of their own," Levy says. "What are they selling that doesn't exist out there in the market already? How far are they going to get by saying, 'We do software integration better than anyone else.' Well, really? That's a dubious claim. They have to have an image they can project other than 'I'm a reseller of so-and-so.'"
Levy agrees that services will be the ultimate differentiator among VARs in the future. More important than that, the uniqueness, quality and breadth of those services will prove key.
What's more, "brand-bundling" may turn out to be equally pivotal. Just as solution providers package products with services these days, many are creating brand bundles. Simply put, they're mixing and matching their own brands with those of vendor partners. Which names go into the mix depends on a solution provider's market clout, a prospective customer's size and the circumstances.
"We push our own name first and foremost, but we use vendor names too," Webb says. "It's really a matter of knowing when to tout your own name and when to tout someone else's. Brand-bundling is our theology."
To Ania Levy, president of Levy LeGette, an IT-contract negotiator based in Cherry Plain, N.Y., it's no surprise that many solution providers choose to lead sales calls by touting the names of their well-known vendor partners.
"Of course VARs are leading with 'I'm a Microsoft reseller.' In many cases, they simply don't have a brand of their own," Levy says. "What are they selling that doesn't exist out there in the market already? How far are they going to get by saying, 'We do software integration better than anyone else.' Well, really? That's a dubious claim. They have to have an image they can project other than 'I'm a reseller of so-and-so.'"
Levy agrees that services will be the ultimate differentiator among VARs in the future. More important than that, the uniqueness, quality and breadth of those services will prove key.
What's more, "brand-bundling" may turn out to be equally pivotal. Just as solution providers package products with services these days, many are creating brand bundles. Simply put, they're mixing and matching their own brands with those of vendor partners. Which names go into the mix depends on a solution provider's market clout, a prospective customer's size and the circumstances.
"We push our own name first and foremost, but we use vendor names too," Webb says. "It's really a matter of knowing when to tout your own name and when to tout someone else's. Brand-bundling is our theology."
NEXT: 10 branding tips