Extreme Networks Continues Channel Revamp
But Extreme isn't resting on its laurels. The vendor is continuing to modernize its channel offerings, leveraging the channel as a "key asset" and straying away from a direct sales model, said Chris Rajiah, Extreme's director of North American channels.
According to Rajiah, last year's Extreme channel updates, which included adding a new Diamond Elite partner level, a partner loyalty rebate program, a lead-generation program and revised marketing development funds opportunities, have resonated.
Since the updated program went live on April 1, Rajiah said the revenue shift to the channel grew from 68 percent to 82 percent; Extreme increased channel staffing by one-third; all four partner levels saw significant revenue increases; certifications earned by partners grew four times over; 90 percent of all marketing development fund accruals were strategically spent; and Extreme's lead-generation program led to a 50-percent year-over-year increase in net new partner sales.
The revamped program, Rajiah said, put in place the fundamentals of a successful program. Now, he said, Extreme can set its sights on helping partners make money.
"We can now focus on growing the revenue aspects of things with partners," he said.
And while Rajiah said the successes are based on Extreme adding new programs and making a solutions pitch, as opposed to a product pitch, he added that partners are also siding with Extreme to offer an alternative, lower-cost vendor in an uncertain economy.
"Customers are starting to pay more attention," Rajiah said. "There's more calls coming in looking for an alternative solution."
In response, Extreme is adding new incentives to its channel offering. The company will now allow deal registration discount stacking and let public RFPs qualify for deal registration. The company is also launching added service revenue tracking tools for partners and a reworked partner Web portal. Additionally, Extreme has launched a Nortel trade-up program, letting customers and solution providers get discounts on Nortel gear trade-ins.
The company also is unveiling a new customer leasing and financing program through Leaf Financial. The program offers channel partners who buy from Extreme distributors the ability to select from a variety of financing options.
"In today's environment it is beneficial that our channel partners have solid and flexible financing choices to extend to their customers and this is now available with this financing program," Rajiah said in a statement.
John Delozier, executive vice president of sales and marketing with solution provider Cross Telecom, said in the past year it has become more attractive to do business with Extreme from both a programmatic and technological standpoint.
"These guys really believe in themselves and they drink their own Kool-Aid," he said.
Cross Telecom is a Diamond Elite Extreme partner, through which it sees the highest discount level, roughly 40 percent. For marketing development funds, it also gets 3 percent off list and 5 percent off net.
Still, Delozier said, going up against the big boys as an alternative is a challenge for Extreme, though current economic pressures are making it a bit easier.
"Extreme's challenge is at-bats; they've got to get to the plate," he said, adding that Extreme should get more chances, especially now that "everybody's looking for alternative technology solutions."
With Extreme's revamped program, Delozier said he expects a sales increase of 30 percent in 2009 over 2008. He said he expects his Cisco business to grow about 10 percent. Extreme will make up about 20 percent of Cross Telecom's overall business.
"We're looking at a significant year with Extreme -- in the seven figures," Delozier said. "They make it financially feasible to do business with them."