It has been almost a year since Nortel first kicked off its SMB reseller recruitment initiative in the U.S. and Canadian market. Since then, Nortel’s reseller base has almost doubled in size and according to a Nortel channel executive, the company is just getting started in this space.
David Wilkinson, vice-president of North America’s channel strategy at Nortel, explains the company recently created a data portfolio catering to the SMB partner and end-user market because, he says, there are still lots of opportunities in this space.“We’re coming up with a new SMB data portfolio that’s purpose built for SMB,” Wilkinson said. “Broadly speaking, we found we didn’t have the right routes and coverage to market because our penetration in the SMB space was low. We needed more partners to help us gain more reach in this area,” he added.
Nortel began its SMB reseller recruitment last October by leveraging off of its existing distribution partners such as Ingram Micro and Tech Data. Wilkinson says up to date, Nortel has increased its reseller base by close to 400 partners; almost doubling the number of resellers Nortel previously had before their recruitment efforts began. While Wilkinson says the addition of 400 new resellers may sound like a huge number, for Nortel, it in fact isn’t.
“We had some markets in Canada that were already highly saturated with Nortel resellers,” Wilkinson said. “We were very strategic and targeted in how and where we looked. We wanted to go to areas that were underserved in the market space.”
According to Jon Arnold, a principal independent consultant at Toronto-based JArnold & Associates, going after the SMB space was something Nortel needed to do in order to keep pace with the competition.
“Nortel seems a bit late to the game here,” Arnold said. “But the market is still developing, so if they can effectively support the right channel partners, they could do alright. However, they aren’t readily associated with this space, so it will take a lot of upfront work to become established,” he said.
Nortel partners can also go on the company Web site to download Nortel’s Knock out Cisco sales kit. This, Wilkinson says, is a tool that is made up of different scenarios and case studies which are compiled by a business intelligence group working out of Nortel.
“This is distributed out to the sales force every week,” Wilkinson said. “Before, this was something more internal. We’re trying to make it more externally available now to our partners.”
John Stasick, director of channel management and development at Nortel, adds that the kit offers different sell-through scenarios that some of their partners have faced to help fellow partners with future sales.
“Their documented experience with their customers shows how they’ve overcome the Cisco challenge,” Stasick said. “We then turn that into a case study to distribute to our partners to use as a simple and helpful tool.”
Another new campaign that Nortel is focusing its efforts on is its My Business campaign, which targets the SMB partner space. Wilkinson says through this initiative, leads come through an online sales centre and the company also helps partners make outbound calls to help generate more leads.
“We’re also going to enable our SMB partners with an SMB specialization option as part of our Partner Vantage program,” Wilkinson said. “This will launch in December to allow partners to better differentiate themselves based on their desires and business models when it comes to them going out to market.”
Nortel also publicly advertises its products as being 30 per cent less expensive than Cisco products. Wilkinson says this number is specific only to Nortel’s SMB data portfolio, where products were compared by list pricing.
“This technique has taken off so well that we’re now in the process of creating that same comparison structure with our enterprise products,” Wilkinson said. “When it comes to our competition and Cisco being the market share leader, wherever we can find areas that we can compete strongly in, we want to be more aggressive in it.”
In addition to Nortel’s data solution portfolio and ongoing sales initiatives, the company, Wilkinson says, also wants to grow its IP business and VoIP market share as well. To help do this, he says since Nortel’s Partner Advantage channel program was first launched in January, the program has since then been revised to replace volume requirements with more of a value-based type of criteria approach.
“We’ve removed some of those barriers that were previously volume-based because we also want to reward our partners who may be strong but who may not yet have the volume,” he said. “Our partner program has more flexibility now and at the end of the day, this means more margins for partners.”
On Nortel’s strategic Unified Communications alliance with Microsoft, Wilkinson says for some people, relationships with Microsoft can sometimes be described as a sort of love-hate relationship.
“For Microsoft, people may say there are some challenges when dealing with them because of things like they’re very single-focused on what they want and how they want to drive the market place,” Wilkinson said.
On the Nortel end, Wilkinson says the company remains optimistic when it comes to their partnership with Microsoft.
“On the partner end, this relationship has generated nothing but positive energy,” Wilkinson adds. “We’ve tightly integrated with them and their sales team to see how we can go to market and handle situations. We’re also doing a lot of joint sales calls and joint planning,” he says.
He also points out that Microsoft is not the only vendor Nortel is currently doing business with. He adds that Nortel is also doing collaborative work with traditional PC manufacturers such as HP and Dell around product development and solutions.“We’re trying to open up new avenues and markets for both Nortel and our resellers,” Wilkinson says. “There are more market opportunities for us to tackle here.”
Despite all of its efforts around new solutions and activities, Wilkinson says Nortel is content with its current partner community.
“We have a diverse partner community,” Wilkinson says. “We’re looking for partners who can move with us as the market trends shift. We want to embrace our existing partners to show them a payback and investment path that will help them be more successful as they grow with us.”