Apple in the Enterprise: Try not to say ‘Cool’

It is hard to think of a recent IT hardware earnings report as staggering as Apple’s recent quarter. Has any large hardware company EVER grown the top line this big in a single quarter?  No they have not. With 67% top line growth and the ability to ship category creating new products like the iPad [4.2 mil sold] — they do appear unstoppable —- with consumers.

But what about the Enterprise?

The iPhone has made great penetration against RIM’s Blackberry in the corporate space — undoubtedly led by executives that demanded it of their IT departments. But the cost differential of an iPhone to a Blackberry is almost nil. What happens when that same exec wants his team to have an option for a MacBook Pro verse an HP laptop. Sticker shock ! - the delta is close to 100% — yes almost $1,000 more for a like configured MacBook Pro verse a Win 7 HP or Dell with an i5 processor. That is a tough conversation that will need more than…”but it’s so much cooler - look how the logo lights up on the cover and all!”

How will Apple drive that conversation? If they expect to make a meaningful penetration with SMB and Enterprise IT by encouraging IT decision makers to turn up at an Apple store [ pretty much thier  current plan] - they will fail. Can you think of any current IT hardware that is considered and sourced that way ? Sure CDW does a great job with commodity hardware that is already on the ‘Standard and Approved’  list of enterprise companies. But Apple needs live bodies to help them tell the ROI story on their stellar OS / hardware integration. And best if the salesman never uses the word ‘cool’ in the pitch. No one ever justified a $1k per laptop uplift because it was cool. Cool only gets you to about $250 !

The question is: Will Apple do this themselves with an expensive, Apple badged salesforce?  Not a real scalable model and tricky with the margin pressure volume purchasers will exact on their current GP of 39%.  Or will they rediscover the IT channel they long ago abandoned [correctly at the time] in favor of going direct? If Finance gets a vote — the channel will get the nod. MSPs are especially well qualified to quantify the lower support costs of a Mac desktop for enterprise and SMB prospects. Of course that should be the focus of the pitch! the cool illuminated logo can be the unstated, intangible glowing in the background.

VARs weigh in on Oracle with Hurd

Channel Matters has been speaking to a lot of VARs about the hiring of Mark Hurd @ Oracle.  Let’s summarize all of the conversations:  1.)  ‘Maybe’ Hurd can inject some channel DNA into the very well established preference @ Oracle for selling direct - even to SMBs. But will this really be a first 12 month priority for him? 2.) Since Hurd dramatically cut R&D spend @ HP, and favored growth by acquisition [ EDS, 3Par, Palm, Mercury, etc.] Will we see less organic innovation from Sun? The HP PSG group R&D spend is 1/2 of 1% of annual revenue. In the heyday the R&D spend @ Sun was 15% of annual revenues.  3.) Expect a big Storage acquisition by Oracle sometime soon. Everyone wants a bigger piece of that space - especially cloud storage.

There are now a lot of  really big egos in that Oracle exec suite: Larry, Safra Catz, Hurd, etc. —and M&A history is littered with great strategic direction and synergy undone by the inability of superstars to share the limelight. [ See Disney: Eisner and Ovitz, etc.] But at the least the hiring of Hurd proves Larry is serious about being a hardware player and monetizing his $7 bil investment in Sun.

What is amazing is that the HP Board did not more specifically lock up Mark Hurd’s ability to go to work for a competitor and now are trying to sue to prevent him from doing what thier massive $35 mil payout could have done if they had structured the payments accordingly. California is a ‘Right to Work’ state and non competes are famously hard to enforce there. That lawsuit will prove to be meaningless.

VARs really like the Enterprise focus of Oracle and now Sun / Oracle. The ability to deliver a fully integrated stack solution in defined verticals from one vendor.

And of course, investors like the cash flow that Oracle’s DB business brings to any acquisition decision. The only business better than Oracle’s DB business is maybe being a Russian oil oligarch!

2011: It’s all about the cloud!

Some new data out this week with some incredibly HUGE forecasted numbers for the growth of cloud computing. You can read Om Malik’s post here.  Everyone is trying to figure just how big the cloud king Amazon Web Services really is — with the guess @ $500 mil to $650 mil.  We actually think it is higher — but does it really matter to you the reseller?

You must have figured out by now that premise based hardware in the SMB, Mid Size and –increasingly some finite apps in the Enterprise are moving to the cloud. Does how fast really matter?  What matters is who your partners are.  Who can bring you a business proposition and a quality, scalable portfolio of services that will resonate with your customers.

IDC says the the WW cloud market will be about $22 bil this year — and moving to $55 bil by 2014.  That is big enough growth to care.  We think the Cloud infrastructure companies with the most partnering potential for you are: RackSpace, IBM Cloudburst, Microsoft and Amazon Web Services.  We’ll discuss each in more detail in the coming weeks.

What role Social Media Mktg for B2B people like us?

If you think that Facebook is all about helping people under 30 connect for their next date — well we need to rethink that prejudice. We recently attended a great pitch from a social media marketing agency, called Room 214, that defined in great detail how b2B marketers - especially in high tech - who are using Facebook to drive real lead acquisition. The number of hours — during the work day — that many of our target prospects are spending on Facebook is staggering!  We need to think about Facebook much more as a platform to harvest prospects from than a NewsFeed of friends of activities.It’s not just for B2C !

LINK

Take a minute and check it out.

The Economy is Recovering: But is your sales pitch stuck in the past?

Channel Matters is ecstatic about the **almost** universally great Q1 earnings season. Led off by Intel’s 46% top line revenue growth a few weeks back! So…IT doors are reopening for VARs and their sales teams. Great! Now what are you going to pitch?

A revolution is happening — and it’s all about the cloud. Software, Storage, Servers, Network Infrastructure….everyone needs it and no one wants to own it and take care of it anymore. Especially SMBs and Midmarket firms. We’ve been speaking to many SMBs that have seen the future and it is all about “you name it’ as a Service”. “Why would I ever want to own Servers & Storage?” a small 40 person start up said to us last week.

So what are YOU going to do about it? They still need servers and everything else - but they don’t want to own it. VARs must move quickly to align with SaaS, Hosting and other Managed Services players to absolutely stay relevant in the 2010 economic recovery. VARs must absolutely lead with services in 2010 - no question. Where there is a paradigm shift - there is confusion and a hunger for some value add. And that is where you come in - because you are going to lead your sales pitch as a Subject Matter Expert on all things Cloud! So get out your ROI calculators and help IT look smart to the Finance team they need to convince .

Who can really sell Managed Services to SMBs?

Recent news that Staples is getting into the Managed Services business got us thinking: What does it really take to close SMBs on these outsourced services ?  Will SMBs really want to source IT services from the same place they buy paper and toner ?  Will ‘Staples Advantage’ in store salespeople be able to leverage the wide and shallow relationships with hundreds of thousands of SMBs into a more profitable services relationship ?

It appears that Staples is starting with Print services — however Channel Matters could find no website content describing these services @ Staples.com or CorporateExpress.com.  This print services area might make sense — but it would appear there is a huge leap to get to building the confidence and technical integrity required to convince an SMB that site hosting, Security services, and app hosting can be delivered with 99% SLAs from an office products retailer.

Of course , five years ago, we never thought CDW could sell Enterprise class Servers, Storage and Networking gear —- and clearly that is no longer the case . And they are making a good go of it with managed services  resell from their  Berbee acquisition.

Back to Staples:  You’ve got to love the database list and DemandGen potential they bring to the game.  Who would not want to expose a free trial offer of 10 seats of XYZ security suite to that list! I don’t know a VAR that would not want 4% of that number!

Is your Reseller Firm Optimized for Getting Found ?

Channel Matters is consistently amazed by the disconnect between End User behavior and reseller marketing spend. Too many resellers seem unaware that their online presence, and social media mentions often time precede a phone call from a new customer. Search Marketing and Social Media marketing should be one of the highest priority spend categories of any reseller in 2010.

Your prospective customers are seeking testimonials and ‘online social proof’ that you are the local expert in: virtualization, HP Servers, or Microsoft Dynamics implementation to name a few. But resellers do not seem willing or knowledgeable on how to get there from here. this is understandable as these categories are not simplistic to optimize — but help exists.

Channel Matters recently attended a seminar in Denver hosted by Heather Lutze of the Findability Group. Heather correctly emphasized the criticality of investing in these areas to maximize your online credibility and build your online brand. One of Heather’s favorite quotes: ” World domination through key word phrase ownership” is only part of the trick! yes - Paid search and maximizing organic search results are minimum table stakes in 2010 — but so are simple video testimonials from your best customers, and social media mentions on sites like LinkedIN ….and even Facebook. Did you know that Twitter is now the #3 Search Engine — tied with Yahoo?  [Google - #1 and Facebook - #2]Clear evidence that brand building online is changing.

Event Marketing with notoriously suspect ROI —should be way down the list of reseller spending priorities in 2010.  Seek out experts like the Findability Group to maximize your online presence.

SaaS - What role resellers?

Lots of teeth gnashing by resellers these days on how they can add value and , of course profits, in the emerging SaaS era where the big fat license fee of upfront software sales and maintenance is replaced by a MUCH smaller per seat monthly recurring fee.

I’ve been talking to many ISVs in the Enterprise Mobile app space recently — who see a huge need for reseller partnerships . 2GoSoftware out of Dallas is a great example — they do no direct sales of their Windows Mobile app and actually rely 100% on hardware resell partners that bring:  market reach, sales teams, and implementation expertise. And the have no plans to add a Direct Sales force as they expand into new app areas beyond their core Field Service / Routing, and Scheduling.

Salesforce.com — of course the shining pioneer in this space - has embraced firms like Blue Wolf who enable and implement complex CRM implementations.  And aren’t they all a little complex ?  I have yet to meet an end  user who implemented SFDC without wanting to bridge to content and other apps n the enterprise.

SaaS is here to stay and will only grow. The value prop for the end user is too strong for this reality to not come to be.  The challenge for resellers is defining thier value add with SaaS ISVs.

Guaranteed B2B Lead Programs - This Works!

I continually hear from vendors [and a few resellers] about the incredible lack of expertise in the reseller community with DemandGen marketing tactics.  A revolution has occurred over the last few years among B2B marketers — many spending @ least 1/2 of their DemandGen Marketing budgets with online tactics. Paid Search [PPC, etc.], Search engine Optimization [ SEO] , Email, Webinars, Social Media outreach, etc. But the challenge still remains on cost effectively sourcing names to target online or offline.

One of the most productive tactics that is driving results now is ‘Paid Lead’ programs with online campaigns.  B2B publishers [online and offline] who in the past may have rented list names at 30 cents per opt in name - are now entertaining programs where a vendor only pays when a lead occurs.  These Guaranteed Lead programs put the risk on the publishers to deliver leads against their list .  Is it expensive ? Not if you care about aligning your spend only with results! Guaranteed Lead programs cost anywhere from $20 to $60 per lead.  A lead will be predefined in your agreement with the publisher - but might be:  White paper download, webinar/videocast registration, or capturing a registration for any marketing asset that you may be promoting.

B2B publishers are now getting well over 1/2 of their revenue from non advertising sources. They are very motivated to maintain the quality and viability of their Opt In customer  lists for rental to vendors in these types of programs.

Recent 2009  data indicate publisher ad pages are down over 26%! Most publishers [especially small B2B pubs]  are willing to negotiate to be a part of any guaranteed lead program that will deliver incremental revenue.

While there are many critical dependencies to the success of your program — it is key that your Call to Action deliver highly relevant, exciting content that is meaningful to your target. Headlines matter - write a good one that will tease some clicks!

When I grow up

If you work in the channel — you gotta check this one out !