Dell Shows It's Serious About New Channels
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UPDATED: Finally, Greg Donovan can say he's a Dell reseller.
The president and CEO of Alpheon, a managed services provider in Morrisville, NC, has been an unofficial Dell reseller through its "super secret direct program," as he called it, Solution Provider Direct.
Now, however, Dell has made it official with the launch of PartnerDirect, a global reseller program that formalizes such efforts. For Donovan, that means he can finally put a Dell logo on his sales materials. "Up until yesterday, I could tell people I was a Dell partner over and over again and they would not believe it," he told InternetNews.com.
Greg Davis, vice president and general manager of Americas channel group at Dell, said in a video blog posting that the company knew it had to embrace the channel.
"We have to change a culture within the company," he said. "We have a great opportunity to expand our model and provide even more value to our partners and help them be more efficient in their endeavor to be the outsourced IT department for their customer."
Tim Hebert, CEO of Atrion Networking, a managed services provider in Warwick, R.I., was glad to hear that. "What inspired me from this week's announcement is the obvious commitment Dell is making to the channel," he told InternetNews.com. "It makes me believe that a channel is important to them and they want to balance both the channel and building this managed provider space out."
The program is designed to favor smaller players like Atrion and Alpheon, according to Davis. "A lot of our partners are small to medium-sized business-focused. We're enabling them to use our size and scale to compete against the bigger players," he told InternetNews.com.
PartnerDirect is now available to channel partners in the United States and will roll out to additional countries and partner groups starting in early 2008. Dell will offer everything from build-to-order systems to custom factory integration to best-in-class online support. The program will be managed through a Salesforce.com portal and will require deals with a minimum of $75,000 in equipment.
Davis said the $75,000 limit is set as a baseline while Dell gets the program up and running and hopes to lower the minimum buy-in as the program gets up and running.
The partner program will offer an online support community to channel partners, partner logos and guidelines for certain marketing activities, dedicated sales and customer care, certification paths and training, credit options and deal registration via the SalesForce relationship management tool.
The program is meant to stop potential conflicts between resellers and Dell, which is built on selling directly to the customer. "Our current partners tell us that they like working with Dell because we are a strong trusted brand, but they have been fearful of our direct sales team," said Davis. "So in doing this we can reduce any potential conflicts with our partners selling Dell and our direct sales team selling Dell product."
There will be two levels of partner support: Registered Partner, with the basic benefits of logo usage, access to Dell's partner Web site for online ordering, access to Dell materials and post-sale support and financing options, and Certified Partner, for more in-depth support with options like field-based account management and enhanced financing options, deal registration and support.
Donovan said his primary business is services, not selling hardware, so having Dell is a convenience more than a must-have. Still, he's glad to have it. "I've always wondered why they didn't get into a more formalized direct program earlier," he said. "We've had customers go direct because they weren't comfortable buying from an "unauthorized" reseller, because there was no formal program."
Like Donovan, Hebert was interested in selling services and the hardware was a just means to the end, but he's happy to have Dell along. "Hardware doesn't mean much. If I can make it a bigger solution, that's a plus for my client. They don't have to worry about buying the hardware and software. They can buy it all from Atrion and don't have to deal with multiple providers," he said.
On the consumer front, Dell made another move that was unthinkable just a year ago; it has entered the retail channel in a big way by signing on to sell its Inspiron notebooks and a variety of desktop computers through retail giant Best Buy. The hardware will be in 900 stores in the U.S., which is essentially all of Best Buy's U.S. outlets.
Unlike its foray into Wal-Mart with a single, low-end system, the Best Buy effort will be involve multiple systems aimed at a higher price point. The list of systems includes the XPS M1330, Inspiron 1521 and Inspiron 1420 notebooks and the XPS One and Inspiron 530, 531, and 531s desktops. Additional models and colors will be available in coming months.
Stephen Baker, vice president of industry analysis for NPD Techworld, said this deal confirms Best Buy's dominance in retail. "Best Buy is the number one retail seller of PCs, and in a lot of ways this is just as important for Best Buy as it is for Dell," he said. "What it says is there's only one place to go if you want a choice of a PC, and that's Best Buy. They have HP, Acer, Gateway, Apple, Toshiba, Sony and now they have Dell."
As far as Dell goes, he said it now has a wide range of retail options, between Wal-Mart for the mass market, Staples for the SOHO market and now Best Buy for the well-heeled buyer.
"The real recognition of how important Best Buy is that Dell isn't selling the entry-level stuff. Dell is selling their very best stuff, the stuff that will change the game for them. It says they recognize they can't change the game at just dell.com," said Baker.