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Cisco delivers products for its SMB promise

Canadian operation moves SMB sales team into the channels group

Cisco Systems (Nasdaq: CSCO) didn’t waste too much time populating its SMB portfolio after announcing late last year it would invest US$100 million into the SMB channel to try and grow the market.

Available now from Cisco are Spam & Virus Blocker, Smart Business Communications System, a new wireless desktop IP phone, Cisco’s 520 Secure Router, and the Small Business Network Storage System.

Also part of this rollout will be the Cisco Small Business Support Center for customers and solution providers, which includes a new online support community with self help from Cisco, partners, industry experts and other small business professionals. This support centre will have discussion groups, wikis, and application notes.

The investment is part of the Small Business Technology Group, which was formed to develop new products in connectivity, security, remote access, productivity, customer interaction and customer support.

Currently Cisco globally has just under US$8 billion in revenue from the SMB.

The strategy behind Cisco’s SMB push was to segment SMB customers into three areas: Basic, Open to Guidance and Elite. Elites understand technology, want to adopt it and have IT staff. Basic are low-end customers who are price conscious, while the Open to Guidance group will be Cisco’s main target for now, according to Mark Monday, vice-president of the Small Business Solutions business unit for Cisco.

“The open to guidance customer is looking to someone to call on,” he said.

Monday added that VARs here must answer questions such as: “What’s in it for me? And, how do I improve productivity?

“This group is large and unserviced. We’ve targeted 64 million small businesses worldwide and a very large portion is in the Open to Guidance category,” Monday said.

In Canada, Cisco Canada moved its SMB sales team into the channels group so it can get better access to new routes to market by leveraging more channel programs, budgets, and channel marketing dollars.

Todd Madgett, director, small business for Cisco Canada, said traditionally Cisco’s SMB sales team reported into the commercial organization as a segment of commercial sales. As a segment, they took a very sales tactic approach to the market with the account team, which he said limited their ability to scale into new markets and customers.

“Since we’re a 100 per cent channel led sales team, this allows us to drive specific programs with our partners, and at the same time allows us to reach into newer markets with our partners. We now have the ability to collectively approach new watering holes with our VARs in areas like the regional Chamber of Commerce, Boards of Trades, etc.,” Madgett said.

All the new SMB products will be offered through Cisco Canada’s Small Business SKU’s through distribution.

“What we’ve found in SMB is customers want product on the shelves and we intend to deliver this through our partners and distribution to increase volumes and move away from our traditional model, where we make to order in our enterprise markets,” Madgett said.