Marketing is a necessary evil for any reseller that wants to grow. However, an effective marketing strategy must recognise exactly what the product or service is and who it should be directed towards, while taking care to measure the outcomes. With such a crowded market today, there is no use in just shouting your name from the rooftops.
Marketing is not always an easy exercise. On the one hand, it is Business 101 that you will make more money if more people know your name and what you do. The problem is how to find time to work on the business when you are flat out working in it.
In a survey this year of its resellers' marketing efforts, LAN Systems found that 47 percent either had inadequate marketing staff generally or only had people working on certain areas. And almost half (45 percent) of respondents said that they would like more help with their marketing.
Colin Williamson, with Sydney reseller Comaxes, says his company only recently brought on a full-time marketing person after realising that the function needed a lot more attention or else valuable opportunities would go begging. "Previously it [marketing] was seen as a part-time role," he says. "People with other responsibilities in the company were trying to juggle marketing activities with their full-time job."
Through its online subsidiary PHd Sites, Comaxes has its work cut out just ensuring that its marketing content and activities match those of its suppliers.
Aside from this, the company was also finding it difficult to keep track of the many vendor deals out in the market, not to mention the work involved with identifying and presenting proposals for market development funds. "It's now become more of a full-time role - it just loses focus if it's left up to someone with other responsibilities."
High costs of marketing
But while many IT resellers understand the importance of marketing to help grow their business, many simply do not or cannot afford to employ an in-house marketing specialist, says LAN Systems marketing manager Pat Russell.
"This could mean their marketing programs are run by other staff who may have fortes in other areas but may be lacking the appropriate skills for effective marketing."
Russell also warns of the dangers of preparing marketing material in-house on the cheap.
"I have seen some resellers' websites and brochures that have been poorly designed and have messages that are not clear to the potential customer.
"Simply having a professional web and print image which is consistent for all reseller communication will go along way to building credibility with their customers."
As well as looking good, the message must also be clear, especially when trying to sell technology. "I have also seen brochures and emails produced by resellers that focus on a product having the specifications X,Y,Z and features A,B,C et cetera, but do not make it clear to the end user what these benefits will mean to them," Russell says.
"Reducing some of the technical spiel to simple benefits for an end user could go a long way to helping increase the effectiveness of marketing campaigns." The same applies for things like events: people generally need a compelling reason to attend.
In response to increased demand for marketing help from its resellers, LAN Systems has developed a new program called MarketVision, which offers a range of practical and affordable services that will not break the bank.
"Resellers will be able to benefit from this service as they will be able to utilise marketing consultants that specialise in the IT industry, work closely with the vendors of the products they sell, plus it will be made more affordable for resellers to use MarketVision rather than using external marketing and advertising agencies," Russell says.
Rival distributor Express Data has been gradually ramping up its marketing efforts for resellers over the past few years and now has nine staff working across business development, event management, design and public relations. "They are constantly booked out," says marketing manager Donna Adam.
Generally she feels that while resellers are enthusiastic about marketing, they often lack planning skills. The area where this is most evident is in conducting proper database management. "Usually in combination with a campaign resellers will want to use databases that are not up-to-date or cleansed."
Online marketing firm Intersell has an exclusive marketing agreement with Ingram Micro and offers partners what it describes as a complete turnkey, e-commerce solution. As well as helping partners design their web interface, back end payment systems are supported along with features such as online access to Flexirent.
"This is a walk-up start for resellers looking for an e-commerce presence," says Intersell general manager Wayne Troy. Over time he hopes that more and more partners will realise the value of even the smallest marketing activity.
"The biggest challenge that some of the resellers in Australia face, especially the smaller guys, is understanding what marketing can do for them." It does not need to be complex or heavy handed. "Every point of contact with a client is an opportunity to market to that client," Troy explains.
Craig Neil, managing director of telecommunications integrator NSC, says that "marketing is the hardest part of the business".
What makes things worse is that because marketing is far from an exact science, there can sometimes be unreasonable scrutiny of activities when viewed beside other more tangible areas of the business. "I fully appreciate what our marketing team does but when you've just spent a lot of money on a campaign the figures look terrible."
Fortunately for NSC though, the fact that it sells in a high growth segment like voice communications has taken away some of the pressure. "What's helping us is that we're in a good market - people are actually interested in hearing from you," Neil says.
Having tried just about every form of marketing available, Neil says that it is not something that gets any easier because it is always about trying to find the right balance of activities for any given point in time. "What we've discovered is that it's not about doing one thing - you've really got to do a combination of things."
Kerstin Baxter, director of Microsoft's Partner Group in Australia, says that because of the company's reliance on its partners, helping them to market is a big priority.
"Our business model is 100 percent through partners, so we believe strongly in investing in the partner community." A big part of this is actual marketing training for resellers.
"We try to share experiences and make sure they are going through those first steps."
Baxter stresses that the most important thing for resellers to understand is the difference between "just getting bums on seats and "getting well-qualified prospects".
"Instead of targeting 80 people, it might be better to target just 20.
"It's all about the 'velocity of that pipeline'." While many are critical of how resellers handle their marketing, Baxter says that it is really time that is the major problem.
"I don't think I'd be so harsh to say that they [resellers] haven't been doing it right - it's more that they don't have the time."
Partners that apply for co-op dollars are put through a training program as part of the approvals process. Microsoft will often match successful partners dollar for dollar.
"All of us have ideas but we don't all know how to execute most effectively, and how you start," Baxter says.
Microsoft's Partner Marketing Centre is aimed at removing much of the legwork associated with getting started. "We have a full suite of marketing collateral from electronic and print direct mail, scripts, sample business letters, fax templates, customer presentations."
3Com is another vendor that puts a lot of energy into marketing for its partners. "The main thing we concentrate on is having clear, segmented and measurable returns," says the company's channel manager Dean Vaughn. "There was a lot of end user marketing that wasn't getting tracked properly."
Another important area that 3Com saw the need to address was managing resellers expectations. "Smaller guys have grandiose objectives and we bring them back to where they are going to get the best return."
3Com sees its reseller marketing programs as a two-way street. "Externally it's partner loyalty - we're driving loyalty because we're helping them grow their business," Vaughn says. Still, the message is far from getting through, with only about 20 percent of partners taking full advantage of 3Com's programs, and, put simply, "they are our best performing partners".
Garrison Huang, director of Sydney-based tech accessories outfit Anywhere Computer Systems (ACS), says he often despairs at the fact that his partners do not take advantage of even the simplest and cheapest programs on offer. For instance ACS produces an annual catalogue of about 2500 products. For $5 a copy, minimum print run 200, resellers can have the catalogue branded as their own.
But only a handful of partners have taken up the offer, despite the fact that such a small investment can be recouped almost immediately.
"I can't imagine how they can grow their business unless they spend the necessary investment dollars," Huang says. "The mind-set is not there."
Paul Fowler, director of communications specialists ISPhone, says "often people look at their target market like some alien being", when really marketing does not need to be so hard, notwithstanding the inordinate number of university courses that it has spawned.
"If you can deliver benefits that become a 'must have' then sales can be a lot better than if it is just 'nice to have'," is a good common-sense example, Fowler says.
In developing a strong, simple message, it is important for resellers not to get bogged down in the detail. But this is not always easy in the technology business. "Look at mobiles - they have features as long as your arm but most people only use a fraction of those. But the phone itself is not generally listed as a feature," despite the fact that "it's not the technology that customers buy, it's the outcome that technology delivers".
Australian marketing director with multinational Avnet Partner Solutions, Michael Costigan, says that times are tight in the channel and most companies need a compelling reason to splash any money on marketing. "A dollar saved somewhere can always be spent somewhere else," Costigan says.
Very few companies in the channel have any sort of marketing plan at all, says Paul Reeves, director of marketing consultancy Octane Marketing. "It [marketing] appears to be in some people's heads but very few people have very clear objectives. Departments operate in isolation and end up achieving only half the result."
However, he says that resellers might pay more attention if vendors made it easier for them to access rebates and co-op funds. "Vendors make difficult conditions for people to claim the money back. If those conditions were more simple you would get far better joint marketing programs in the channel."
Nonetheless, Reeves advises that co-op campaigns can often lead to disappointment if resellers have not looked carefully enough to see whether they work for them. "Resellers often get upset by particularly co-op (co-branded) driven programs."
NSC's Neal believes that tapping into specific verticals will often yield the best results. "It's often more expensive but it does return."
One of NSC's strongest verticals is the taxi industry, where there is clearly high demand for communications. "They are very big users of technology."
Moreover though, Neil stresses that to do marketing well you must understand that because the market is always changing you need to be thinking all the time. "The challenge is coming up with new ideas and topical themes and then applying them to your local market. And you have to keep your foot on the gas."
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