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AMD Brings ‘Aggressive’ CPU Rebates To VARs With New Partner Program: Exclusive
AMD’s new invite-only partner program for commercial systems sellers includes volume incentive rebates that two top partners described as ‘aggressive.’ ‘Intel’s program is strong, but these guys have taken a bigger, aggressive investment to help us grow our business and reward us for that growth,’ one partner says.
AMD is bringing CPU rebates to value-added resellers that two top partners described as “aggressive” in a new invite-only partner program from the chipmaker.
Terry Richardson, the Hewlett Packard Enterprise veteran who became AMD’s North America channel chief last year, exclusively told CRN that the volume incentive rebate program is among several benefits in the new partner program for commercial systems that launched on Jan. 1. The program covers PCs using Ryzen CPUs and servers using EPYC CPUs from OEMs like HPE, Dell Technologies and Lenovo.
Richardson, who spent his first several months at AMD building the program, said the rebates and other benefits, which includes training and sales and marketing support, are meant to incentivize partners who sell AMD-based systems and educate them on how AMD differentiates from rival Intel.
“If they choose to really understand and take the time to not only understand the AMD differentiation but start to aggressively position it, then there’s a reward,” he said in an interview with CRN.
AMD is offering rebates in the program on a per-CPU basis, and partners make more money if they are in the program’s Elite and Executive tiers, which are determined by the partner’s annual sales of systems that use AMD processors. The rebates, which also have training requirements, scale up for processors higher in the stack, too, particularly those with higher core counts.
“When we presented the program and the 2022 proposed rebates for client and server, the feedback from the members of the advisory board was those are very, very competitive and very attractive,” said Richardson, who declined to provide specific figures for the rebates for competitive reasons.
Rob Schaeffer, president and COO at Orange, Calif.-based CBT, No. 232 on CRN’s 2021 Solution Provider 500 list, told CRN that AMD’s volume rebates for CPUs are “much higher” than what his company receives from Intel. He said while rebates aren’t the biggest factor that determines preference between AMD and Intel, it helps the conversation.
“It’s one more tool in the salesperson’s tool bag that helps them compete and win for the customers’ business,” said Shaeffer, who previously worked on Richardson’s channel team at HPE. “You have to obviously have the trusted relationship. You have to continue to bring the best of technology that answers the customer’s requirements. And then you need to do it at a competitive price. So with rebates, it’s one more tool that the customer-facing team has at their disposal that they can leverage.”
Rebate programs are important for solution providers, according to Schaeffer, because they can boost profitability for a business that typically sees slim margins with system sales. AMD’s CPUs have been very competitive against Intel’s for the last few years, he said, which makes the rebates even better.
“Any place that you can augment profitability, either at the company level, or the [sales] rep level, it makes a big difference, and when you combine it with a technological advantage, it’s a win-win for everybody,” Schaeffer said.
Solution providers can use rebate money to reinvest back into the company or pass on discounts to the customer, Schaeffer said, but it’s ultimately up to each company how they use it. In the case of his company, CBT uses rebate money to invest in training and hiring new employees, he added.
“We have more engineers than salespeople, and we will continue that ratio, so that contribution to our profitability really helps,” he said.
But while rebates are important, AMD’s new partner program offers other important benefits, like market development funds and co-marketing programs as well as more intangible things like access to technologists and executives at AMD, according to Schaeffer.
“It gives us a special community and a special connection to AMD, and in particular, to their executives, and to their technologists, that helps us stay ahead of the curve, so that’s critically important,” he said.
Scott Ward, chief revenue officer at Westwood, Mass.-based Computacenter, No. 27 on SP 500 list, told CRN that AMD’s new rebate program is “very aggressive.”
“Intel’s program is strong, but these guys have taken a bigger, aggressive investment to help us grow our business and reward us for that growth,” he said.
Echoing Schaeffer, Ward said such strong rebates can help improve profitability, and Computacenter uses such funds to reinvest in the company, which can help it win more business from customers.
“It’ll be a lot stickier because we can offer more than just shipping them a server. I can offer more thought leadership, more real solid technical leadership and solution leadership around the changing environments we all are dealing with every day,” he said.
The introduction of AMD’s new commercial systems partner program comes more than a year after AMD CEO Lisa Su told CRN for its December 2020 cover story that the chipmaker is doubling down on channel partners, which she viewed as the company’s “largest growth opportunity.”
Since then, AMD has hired Richardson to head up a new partner organization and former Tech Data executive Marty Bauerlein to lead the VAR side of the business.
Richardson said the program, which is separate from AMD’s component channel program, said the global program is starting out with some of the biggest VARs and national solution providers in North America. Out of the roughly 500 partners total in the program worldwide, approximately a quarter are in North America, according to Richardson.
While AMD is starting the program with a focus on large VARs and solution providers, Richardson said the chipmaker is trying to reach a larger list of smaller partners through distributors.
“We want as many data center- or client-focused solution providers as possible being aware of AMD and interested in selling AMD solutions to their customers,” said Richardson, who is attending CRN parent The Channel Company’s XChange event, which runs Feb. 27 to March 1 this week. “So we’re very aggressive with our distributors, and part of the program for them is to help us bring the AMD messaging capabilities to that very long list of VARs in North America.”