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VMware Working The Channel

I spoke with VMware last week about its recent channel initiatives. The company is listening to its partners, broadening incentives worldwide to crank up sales.

My interview with Julie Eades, director of worldwide channel marketing, focused on VMware's Wednesday announcement. VMware is paying attention to feedback from its 10,000-plus worldwide channel partners to revitalize and provide incentives at all sales levels. I kept trying to bring the topic around to VMware's less-than-expected results from last quarter; Eades convinced me that planning for this announcement had been in the works well in advance of the recent stock downturn.
The message was clear: VMware is changing its incentive models, opening up rewards at the bottom of the market to drive new business while increasing incentives (approaching 16%) on the high end for top sellers.

Channel partners will be rewarded for sales as low as $2,995 ... which happens to be the starting price point for VMware's Infrastructure 3 Foundation Acceleration Kit. Past "barriers to entry" started in the tens of thousands. The new reward models have a direct tie-in for sales staff and partner management; everyone involved in the chain of sale is rewarded. Front-line folks may even gain a bit more flexibility on price points. What does all this sales talk mean? It shows VMware is getting aggressive on SMBs. Or, perhaps, that VMware is listening when its partners have said that they can sell into this market. Or perhaps that VMware realizes it needs to broaden their base; not every data center is a data center...

The VIP Partner Program also includes a number of training opportunities for sales folks and sales engineers to get schooled up on tech and specs, plus a raft of marketing aids.

75% of VMware's revenue comes from the channel. A growing percentage of that is international.

Sales teams like to sell stuff that:
1.) Has brand name recognition
2.) They (generally) have a decent understanding of
3.) They are "incentivized" to sell via spiffs or other rewards

VMware has the first point covered and is working to address the second and third. Smart moves for an increasingly competitive market, if you ask me.

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