Posted by Jonathan Block on Fri, Feb 05, 2010 @ 10:07 AM
Laz Gonzalez (Research Director) and Jonathan Block (Vice President) discuss our recent channel survey findings around channel incentives (10.2MB, 7:25).
To listen to this podcast, please Click Here.
Posted by Laz Gonzalez on Fri, Dec 18, 2009 @ 08:33 AM
Recently, I read a headline indicating a major hardware manufacturer was concluding its try-and-buy program, which included a full line of servers ranging from $8,000 to $80,000. The article went on to say one reason for ending the program was that some partners indicated it wasn’t performing because end users were reluctant to enter a free trial without having budget.
However, having presented at this specific vendor’s partner conference earlier in the year, I can say partners believed the program was doing extremely well and generating leads for them, albeit with a few glitches. One minor issue was that no one was telling them when the equipment was being shipped to the customer. That was a minor issue that was readily addressed by a company official by means of simply including the partner’s e-mail in the shipment records.
Try and Buy programs in the channel can be very successful; however, companies looking to adopt this tactic should take the following best practices into account:
- Factor in the channel partner. Whether simply notifying them that equipment has been shipped or using the partner’s facilities to conduct pilots, channel resellers can provide the missing ingredient in helping customers through a pilot process where bandwidth is limited and time is in short supply.
- Consider a multi-faceted offer vs. simply shipping equipment to a customer and expecting something to happen. One of the main benefits of a try-and-by offer is that it compresses sales cycles by offering the customer a shortened trial period. However, shrewd manufacturers should also provide a financial stimulus offer at the conclusion of the try-and-buy period so that customers are motivated to act at the end of the trial.
- Recognize that the trial is just part of the process, not the end. Many partners indicate that such a program provides a “door knocker” for them that wasn’t there had the prospect not reacted to the pilot. In times when “no budget” was a line used to keep VARs at bay, try-and-buy programs offered resellers the opportunity to engage with minimal customer commitment. As they nurtured the opportunity and provided value, things quickly changed as budget was freed up for a tested solution.
- Utilize marketing dollars to fund not-for-resale units and let partners support the program through MDF funds. This is a smart use of incentive dollars as it ensures resellers can apply their vendor-supplied resources toward a specific, lead generating campaigns.
While not a panacea, try-and-buy programs have worked in the past and will continue to do so as long as buyers making technology investments insist on seeing technology work with their own eyes rather than believing everything they hear from vendors and channel partners.