SAS Institute makes its first moves towards the channel

Another bastion of the direct sales only model has fallen to the realities of the market with the decision by SAS Institute to launch a channel program.

“We recognize there are opportunities in the SMB market, and we can’t continue to capture all opportunities by just hiring our own sales team,” said Jim Davis, senior vice-president and chief marketing officer of the Cary, N.C.-based business intelligence software company.

“Our sales team focuses on the high end (and the high end differs by country), and anything under that threshold is available to the reseller.”

In the U.S., six products are included in the program, in the areas of data integration, forecasting, desktop data mining, deployment and business intelligence.

The BI licensing model has been changed to per user pricing, instead of being based on the size of the server, to accommodate the needs of smaller businesses.

SAS also offers a substantial percentage of annual renewal revenues – up to 25 per cent – to resellers that maintain their customer satisfaction rating at required levels and achieve certain levels of certification.

The Canadian program is similar, said Pat Finerty, VP alliances and business development for SAS Canada, although “it’s very much a made-in-Canada solution. We spent the last six months in consultation mode with customers, resellers and the U.S.”

“Canada is more mid-market oriented,” he explained. “We’re going industry vertical by industry vertical, and being selective in picking partners. We will be sharing renewal revenue, but how we share will depend on the market, and the depth of skills the partner is willing to undertake.”

“This strategy is a recognition that its existing direct sales approach can’t always scale down to the needs of smaller enterprises,” said Carmi Levy, senior research analyst at London, Ont.’s Info-Tech Research Group. “In this part of the market, a somewhat more deft touch may be required to build the kind of long-term relationships that ensure successful implementations and long-term revenue streams.”

But, he added, “Somewhat more bluntly, the strategy lags that already executed by Business Objects, Cognos and Hyperion, all of which already have strong channel partnerships in play.”

According to Finerty, SAS hopes to gain traction in the market by starting with resellers who already have a strong foothold in each target vertical. He’s hoping for quality, not quantity, looking for what he describes as “a small handful” of resellers who would bring their domain expertise and customer relationships. In turn, SAS will provide training and tools.

“SAS has a long history in working with system integrators,” he noted, and the product training and other materials developed for the SIs are being adapted for the channel. “Feedback we’ve had from resellers we have discussed this with is that they’re looking forward to making an investment in skills development and training.”

This, said Levy, is a move forward for the market. “The most significant roadblock to BI adoption by mid-sized enterprise has traditionally been the skills level of the potential client base. BI is, by definition, a complex and difficult-to-tame beast. This has made it something of a tough sell to SMEs that have been scared off by the steep learning curve required to implement, maintain and take advantage of the technology.”

“Selling through the channel will allow SAS to multiply its efforts by empowering VARs to help SME clients get up to speed.”

And, he said, the channel wins too. “Strong competition tends to enrich the experience for the entire market, and the mid-size space is about to reap the rewards of a dominant player deciding that it wants to play here as well.”

Comment: info@itbusiness.ca

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