After 40 years of predominantly direct selling, SAS Institute is starting to get really serious about channel sales.
The analytics software vendor, based in Cary, N.C. with a Canadian subsidiary in Toronto, has toyed with a channel direction in the last two decades, but according to Doug McLaren, the director of alliances and channels for SAS Canada this time the company has a renewed emphasis and has made significant investments towards the indirect space.
However, McLaren paints a different picture for SAS Canada. He told CDN that channel partners made up approximately 70 per cent of revenues in the previous year. What’s changed is SAS’s market focus from enterprise to small-to-mid-size businesses.
“We are making a shift with a new offering that will go through a channel route. If we have the right programs, people and we are making the investments we see the channel as a way to grow the business. We are not taking this lightly and its now part of our go-forward strategy. And, we are jazzed about it,” McLaren said.
SAS’s perception in the market is one of an enterprise player, But McLaren says the company can provide solutions to all types of organizations. The smallest customer SAS Canada has is a four-person shop who just happens to employ a data scientist. The company’s roots are with organizations who have large data requirements such as government, telcos and financial services customers, but SAS does not believe that’s the entire market today.
“If you look at the managed analytics services that are being provided to organizations; hosted or embedded SAS can offer them unique data solutions to bring them the power of analytics. And, it can be consumed in any way,” McLaren said.
This has led SAS Canada to the realization they cannot go after the SMB opportunity with a direct selling strategy; nor can it take existing technology, with a new program, and scale it up or down for this type of customer.
This new direction has led to the development of a brand new channel program for SAS. McLaren said the channel program has two key components entitled Reseller and Managed Analytics Solution Provider. SAS spent a considerable amount of time developing its education section and will have online training along with classroom training for partners. Partner certifications will be awarded to those successful channel partners who go through this education and training to build a SaaS practice.
The channel program will offer market development funds. A big part of the investment is a channel organization inside SAS Canada who will be tasked to help solution providers with campaigns, prospecting tools and other types of digital marketing efforts. Other parts of the program will include lead generation and deal registration.
“At the end of the day, there will be alignment to the sales organization. This will be key with inside and field sales. The sales team will be compensated better if they go through channel partners than if they went direct. We do not want SAS direct to compete with partners,” McLaren added.
SAS Canada also has come to the understanding they have to make it worthwhile for the channel community to have any shot at establishing a long-term meaningful relationship with partners.
Under this new direction, McLaren said solution providers should expect to see two-times services opportunities that are over-and-above the software margins they can earn, which he roughly estimated at 25 per cent. Renewals will about be about 25 per cent margins.
“We are serious about shifting the ownership of the account. We see the channel as the account owner and the margins will fuel the investments they can make with us,” he said.
One thing SAS Canada does not want to do is create a marketplace filled with SAS channel partners. “We do not want to create a marketplace where VARs trip all over themselves competing on price,” he added.
McLaren does not see this occurring because of the nature of data analytics. He believes partners interested in an alliance with SAS Canada would need to make significant investments in training.
“It’s still early days for us in Canada. Other regions such as the U.K. and Brazil are out of the gate already. We are talking to a handful of partners now and working on staffing up. We understand that this is going to be a collaborative effort with pre-sales. But we are at the point now where we want to have an official launch,” he said.