This is a second in a series of discussion on types of channel partners. Different partners are needed for different products, target markets, price points and functions.The last article covered Distributors and VARs (Value Added Resellers).Read on about commercial resellers and DVARs
Commercial Reseller – These companies sell to home user and very small businesses (think companies with 1 to 5 servers, max).They have a local presence. You might know them by their retail frontage where you take your PC when it goes blue screen. Or it maybe the guy who comes to your house for a $100 bucks and hour to install your wireless network or identifies the nasty bug that came from some third world country. They will clean up the computer, make sure you have the best (or their favorite) virus protection, backup software or any other wiz bang tools (printers, storage, scanners, etc), that you might need.
Some of these companies have 2 or 3 employees, all technical, hands on guys that keep systems running. Or it maybe a franchise like DataDoctors. For very small businesses, they might have their own servers for hosting your website (instead of GoDaddy or Weebly). They may have skills on database development, in case you need help with a system for the business. Most of these guys are amazing and well loved by their customers.
For vendors, there are 10’s of thousands of these companies in the market. They get their information from reading the latest online technical trades and also getting education and information from their distributor. Their customers depend on them for advice. Some maintain certifications, such as Microsoft Gold. Othersmay not be the most current on the latest technology, but what they use works over and over. Often they can be motivated to sell certain products due to promotions. They are great for moving products priced from less than $1000 and up to $10,000.
The best way for a vendor to recruit these partners is through a good distributor or an inside sales and support team.
DVAR – This stands for Direct Value Added Reseller. DVARs are a combination of a distributor and online reseller. They sell through their online site, publish catalogs and bring the value of handling more complex configurations or software licensing through their telesales. Typically they do not offer services or have a local presence, which limits their ability to deal with large complex solutions handled by the VAR. DVARs are used extensively to sell products that have multiple configurations (printers, storage devices, software with lots of options). If you went to their offices you would see a sea of telesales staff, each person with their own book of clients. The telesales will be selling to small and medium businesses and even large institutions. The larger institutions use them just for keeping software licensing straight. To a certain extent DVARs also sell to the home user, generating sales through the catalog or online searches.
Much like distributors, to their get attention vendors need to move substantial revenue through their business. They will include a vendor marketing data on their web or the catalog.DVARs spend a great deal on making their site very user friendly and easily searchable, configurable. Each increase in marketing visibility for a vendor will cost money. The good news is the ROI is easy to track. DVARs are great for products priced from $5000 to $50,000.They work with products priced lower (they are looking for companies buying multiples of one product) and higher, but can be limited because of technical depth on large ticket items.
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Segmenting the Channel – what the heck are DVARs?
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