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“Yes, I am a Reseller! But, Where’s the Margin?”

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“Yes, I am a Reseller! But, Where’s the Margin?”

Every hosting company wants to find their path to success in an increasingly crowded, global, and commoditizing market. With more and more companies getting on the hosting bandwagon, how do you differentiate yourself? How do you bring in that extra bit which will bring your customers the value that they are looking for? In this session, the speaker shares multiple scenarios and best practices on how hosting providers can go beyond just being just resellers to becoming value partners, and in the process build up their margins.

Lemanto Siantar
Channel Development Manager
Softlayer Technologies, an IBM Company

Published in: Technology
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“Yes, I am a Reseller! But, Where’s the Margin?”

  1. 1. CONFIDENTIAL INFORMATION • SOFTLAYER, AN IBM COMPANY Yes, I am a Reseller. But, Where is the Margin? Lemanto Siantar Channels Development Manager SoftLayer
  2. 2. CONFIDENTIAL INFORMATION • SOFTLAYER, AN IBM COMPANY Traditional Reseller Model PORTFOLIO MARGIN ON INFRA MARGIN ON MAINTAINENCE Product from Company A RESELLER Product from Company B In-house Infrastructure Partner Infrastructure LICENSE FEES LICENSE FEES INFRA COSTS MAINTAINANCE COSTS MEMBERSHIP FEES MARGIN SERVICES MARGIN SERVICES MARGIN TOTAL ACQUISITION COST ONE GIANT MARGIN CUSTOMER INITIAL DISCOUNT LOYALTY/ NEW CUSTOMER REDUCTION COMPETITOR ADVANTAGE DISCOUNT ANNUAL CONTRACT DISCOUNT SERVICE DELIVERY COSTS UNEXPECTED MAINTAINENCE COSTS ? ?
  3. 3. CONFIDENTIAL INFORMATION • SOFTLAYER, AN IBM COMPANY Traditional Reseller Model PORTFOLIO MARGIN ON INFRA MARGIN ON MAINTAINENCE Product from Company A RESELLER Product from Company B In-house Infrastructure Partner Infrastructure LICENSE FEES LICENSE FEES INFRA COSTS MAINTAINANCE COSTS MEMBERSHIP FEES MARGIN SERVICES MARGIN SERVICES MARGIN TOTAL ACQUISITION COST ONE GIANT MARGIN CUSTOMER INITIAL DISCOUNT LOYALTY/ NEW CUSTOMER REDUCTION COMPETITOR ADVANTAGE DISCOUNT ANNUAL CONTRACT DISCOUNT SERVICE DELIVERY COSTS UNEXPECTED MAINTAINENCE COSTS ? ?
  4. 4. CONFIDENTIAL INFORMATION • SOFTLAYER, AN IBM COMPANY The New-Age Resellers PORTFOLIO Product from Company A RESELLER Product from Company B In-house Infrastructure Partner Infrastructure LICENSE FEES LICENSE FEES INFRA COSTS MAINTAINANCE COSTS MEMBERSHIP FEES MARGIN SERVICES MARGIN SERVICES MARGIN TOTAL ACQUISITION COST ONE GIANT MARGIN CUSTOMER INITIAL DISCOUNT LOYALTY/ NEW CUSTOMER REDUCTION COMPETITOR ADVANTAGE DISCOUNT ANNUAL CONTRACT DISCOUNT SERVICE DELIVERY COSTS UNEXPECTED MAINTAINENCE COSTS ? ? MARGIN ON INFRA MARGIN ON MAINTAINENCE CORE INFRASTRUCTURE PARTNER MARGIN SERVICES
  5. 5. CONFIDENTIAL INFORMATION • SOFTLAYER, AN IBM COMPANY Be a SaaS Provider – Increase your Scope COREINFRASTRUCTUREPARTNER SaaS Tool o Manage Your Infrastructure Beautiful Graphing Custom Dashboards API Management Website Monitoring Cloud Management Server Monitoring Advanced Alerting Full API Plugin Store Fully Hosted Monitor Everything
  6. 6. CONFIDENTIAL INFORMATION • SOFTLAYER, AN IBM COMPANY Master an Industry – Specialize a Niche Segment COREINFRASTRUCTUREPARTNER GAMING & SMARTPHONE APPLICATION DEVELOPERS Japan-based managed hosting service provider • Managed Hosting • Dedicated Servers • Cloud Servers • Network Integration
  7. 7. CONFIDENTIAL INFORMATION • SOFTLAYER, AN IBM COMPANY Host a Product – Manage the Environment Oracle ATG Commerce In-house Infrastructure CORE INFRASTRUCTURE PARTNER PCI Level 1 Compliant Hosting Provider • Oracle ATG Commerce Installation, Configuration and Maintenance • Oracle Database, JBoss Enterprise and RedHat Linux Enterprise Licensing • 24/7 Expert Support • 99.9% Uptime SLA • PCI Level 1 Compliant • Performance Tuning • Disaster Recovery • Content Delivery Network through Akamai, Limelight • ATG Development Server Only • Disaster Recovery Cluster (DR) • Hot-Hot Global Load Balancing • Migration • PCI Compliance Consulting • Scalability Services • Upgrades • Web Performance Package
  8. 8. CONFIDENTIAL INFORMATION • SOFTLAYER, AN IBM COMPANY Partner Type Definition Referral Program Are in a position to refer new hosting customers to SoftLayer: Business Partners receive monthly commission payments for referring customers to SoftLayer that result in a signed contract (10% year 1, 8% year 2, 6% year 3) Refer single or multiple accounts of at least $150 per month in customer billings. Referred customers sign directly with SoftLayer Examples include application developers, consultants, web designers, etc. Referral partners are managed by channel sales team Services & Solution Provider Program Buy IaaS offerings from SoftLayer at a discount (from 5 to 20%) Hosting may be resold or delivered as a component of the Business Partner’s overall solution. May or may not leverage SoftLayer’s brand. Is responsible for Level 1 Support. Examples are SIs, MSPs, Solution Providers, Distributors, and ISVs. Relationships are managed by the SoftLayer Channel Sales team Current Channel Programs & Definitions
  9. 9. CONFIDENTIAL INFORMATION • SOFTLAYER, AN IBM COMPANY SoftLayer - Global IaaS Leader Formed by 10 industry veterans in 2005 Model predicated on software-driven infrastructure Unencumbered by early-industry legacy restrictions Founding principles Innovation, Empowerment, Automation, Integration Acquired by IBM in July 2013 9
  10. 10. CONFIDENTIAL INFORMATION • SOFTLAYER, AN IBM COMPANY Cloud Infrastructure At Enterprise Scale BARE METAL SERVERS VIRTUAL INSTANCES Public CloudsHosted Hybrid CloudsHosted Private CloudsVirtual Servers Private Clusters STORAGE
  11. 11. CONFIDENTIAL INFORMATION • SOFTLAYER, AN IBM COMPANY 21,000 Leading-edge Companies Depend on Our Cloud Software as a Service Mobile & Communications WhatsApp Voxer Instapaper Yelp Social Games and Entertainment Hosting & Service Providers EnterpriseMarketing and Digital MediaPlatform as a Service
  12. 12. CONFIDENTIAL INFORMATION • SOFTLAYER, AN IBM COMPANY

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