Value Added Resellers (VARs) can power enormous growth through business development strategies. When focused on finding new ways to provide value for customers and expand their portfolios, business development strategies can accelerate upsell and cross-sell, increase margins, strengthen customer relationships, and help VARs grow their customer base.
At the same time, failing to invest in business development can negatively impact your business. If customers don’t see all their needs fulfilled, customers may start to look elsewhere and competitors may start eating into your territory.
In this article, we look at some successful approaches to business development for Value Added Resellers, with a particular focus on the IT networking space.
B2B technology markets evolve quickly. With new technologies and solutions entering the IT market, most VARs in this space are constantly looking for new ways to answer their customer needs.
Through understanding your market needs, competitive landscape, what advantages (and disadvantages) you may have regarding other players, and leveraging your company’s strengths, there are many ways to unlock business growth.
When thinking of market needs, rather than focus on what products prospects want, focus on pains within the jobs that your prospects need to do. For instance, let’s take a look at a networking automation example.
Enterprises typically have large and complex networking infrastructures, leading to advanced requirements to manage them effectively. By talking to these Enterprise prospects and looking at the jobs they need to do to manage their networking infrastructure on a day-to-day or weekly basis, it will become apparent that many of their tasks are repetitive, tedious, and time consuming. Those are the “pains”. If you are able to find new ways to automate some of these tasks and make them more efficient, you may be bringing enormous value to your customers.
Once you identify such jobs to be done and pains, the next step is to search for technologies or solutions to these, through vendor marketplaces, Google, or simply talking to industry vendor associates.
The biggest opportunities come from identifying which emerging needs will have big markets before your competitors do, and being an early mover to leverage them. When it comes to networking, trends including IT automation or networking orchestration, amongst others, are seeing strong customer demand. VARs that move quickly to incorporate these technologies into their service offerings may have more chances to drive rapid growth than those which do not.
This is one area where you can really differentiate your offering by doubling down on the “value added” part of being a “Value Added Reseller.”
The most successful VARs are in regular contact with their existing customers, and become integral parts of their customers’ business through sharing expertise and creating value that is very difficult to replace. This makes the relationships extraordinarily sticky and provides the VAR with numerous opportunities for cross-sell and upsell. Common ways they do this start with:
As a trusted knowledge partner proactively advising customers on their IT strategies, you will have many more opportunities for upsell and cross-sell than if you simply try to offer bundles and sell solutions with no preliminary context.
Another way to expand your customer relationship is by proposing a flexible pricing model that adapts to your customer needs and is based on delivered value. Some effective ways to do this include tiered pricing models where your customer can add more seats or unlock new functionalities or features, cost, usage, value, or subscription-based pricing models for software, and/or separate pricing for services including onboarding, integration, maintenance, support, and customer success. You may also want to include rebates if customers increase their spend.
Approach your pricing strategy with a mindset to create logical, reusable, and sustainable pricing models. However, pricing being a sensitive subject for most businesses, it is advisable to iterate on this occasionally, and adjusting pricing quickly for the right opportunities will give you a strategic advantage over competitors.
Leveraging reseller programs can help you expand your product lineup and grow your business. Having said that, not all reseller programs are created equal.
The best partners help you with product training, implementation, client onboarding and support, and share marketing and sales material. You can ask them about co-selling and co-marketing opportunities, and propose organizing webinars or events together, to raise awareness around specific market needs and new innovative products.
And you can also collaborate with Vendor and Ecosystem partners to organize workshops with customers, or to offer custom development for specific needs, particularly for Enterprise customers that have particular challenges and the budget to invest. As an example, Boundless offers all of the above support and possibilities for collaboration.
How you measure the success of your business development initiatives depends on the specific strategies you have implemented.
Regarding upsell, cross sell, opening new markets, or selling new offers, you will definitely want to set deal or revenue-based KPIs. But depending on the initiative, you may also want to look at marketing or other metrics, such as website traffic, inbound leads, or even feedback from customers.
Two more things to keep in mind to ensure that you get the maximum value from KPIs, without getting bogged down in unnecessary details:
There has been a huge increase in the number of devices and locations that need to be configured, deployed, and managed, as remote and hybrid work has become common, and many Network Engineers waste precious time on low-value, repetitive tasks, such as making the same configuration changes across multiple networks. Due to this, automation will continue to offer many opportunities to VARs to deliver value to Enterprise customers.
AI’s usage in network software, particularly for supporting critical network hardware, is likely to increase as more manufacturers offer AI-powered software for servers, next-generation firewalls, routers, switches, and more.
Innovation in cybersecurity has produced machine-learning algorithms that can identify system vulnerabilities and potential issues, and detect and react to a threat at a much faster rate than humans ever could. But human vulnerabilities are frequently even more critical. VARs can help customers become more aware of security threats through workshops, training sessions and policies. As new hardware, software, and advancements in the Cloud, the IoT and WiFi 7 come online, there is plenty of scope for VARs to leverage their knowledge to help Enterprises manage cybersecurity risks.
WiFi 7 is predicted to vastly improve WiFi speeds, support additional connections and ensure lower latency for all users. Network capacity is also expected to be greatly increased, allowing large volumes of data to be transferred over different nodes in the network. However, the WiFi 7 standard hasn’t been finalized yet — a final version of the standard is expected to arrive in late 2023 or early 2024.
Business development is a critical part of success for many VARs. But the way you approach it can mean the difference between a successful program that helps create stickier partnerships, provides more up and cross sell opportunities, and increase margins, and an unsuccessful one, which can present long-term risks to your business.
To find out more about the possibilities of becoming a Boundless VAR partner, visit our Partner Page.