Challenge
A major IT hardware original equipment manufacturer (OEM) has traditionally sold its products to larger enterprises through its value added reseller (VAR) and direct marketing reseller (DMR) channels. The OEM has recently introduced a new product line that is targeted at small to mid-size companies. The OEM's primary competitor is also selling to the SMB market and is increasing its win rate, in part because they provide both hardware and onsite installation services. With enterprise IT spending flat, better penetrating the $60B+ small business technology market has become an essential strategy.
Solution
- The OEM has adopted iTeam's Service-as-a-Product™ (SaaP™) model. Working together the OEM and iTeam developed a comprehensive set of installation services and managed service offerings for the OEM's SMB product line. The installation services are packaged and sold at the same quantity breaks as the hardware e.g. 8, 16, 24, 32, 48 and 64 units. This makes it easy for the OEM's VAR and DMR channels to sell a fully installed solution to their end user customers. The services are very competitively priced with great margin for their channel members.
- iTeam and the OEM created a product-specific set of selling tools which are implemented in iTeam's iPlatform™. These tools are available to the OEM's VAR and DMR channel members to facilitate sales.
- The OEM has bundled installation and managed services for the product launch, and the combination has a lower price point than if they were purchased separately.
- The bundles and installation services are available to all of their VARs and DMRs.
Results
- Launching with installation accelerated the channel and market acceptance of the OEM's product line.
- Sales volume of the product line is exceeding expectations.