Cisco sends resellers on hunt for new business

Vendor offers new incentives in its three-pronged channel strategy

Cisco will reward resellers that hunt down new business in higher-margin but more risky advanced technology sectors under its new Opportunity Incentive Programme (OIP).

The networking giant also tweaked its Value Incentive Programme and its E-learning Programme, and has previewed its Solution Incentive Programme (SIP), which will be rolled out later this year.

On the eve of its global partner summit in Hawaii, Paul Mountford, senior vice president of worldwide channels at Cisco, told CRN the vendor's latest incentive is intended to "fuse the elements of success" of its other programmes.

Mountford said Cisco's partner strategy has three strands. "This summit is about building it all into one strategy. If you hunt, if you grow, if you adapt, Cisco will reward you," he said.

Under the OIP scheme, qualified Cisco reseller partners will be offered three to eight per cent discount, or equivalent rebate, on an entire deal, providing the new business is registered and verified by Cisco. The vendor classes IP telephony and communication, optical, security, storage and wireless as advanced technology sectors.

Keith Humphreys, managing consultant at analyst EuroLAN, thought more cautious resellers might not be happy about registering new business with Cisco.

But he added: "Judging by the applause, it seems partners welcome the fact that Cisco is backing off from doing the sale and passing the end-user a list of partners. It makes it less of a lottery."

Andy Buss, senior analyst at Canalys, said: "OIP is a good way of giving partners an incentive to take risk if the reward is sufficient."

But he added: "The devil is always in the Ts&Cs."

For its E-learning Programme Mountford said Cisco will offer resellers learning credits for end-users to increase margin. "When resellers sell a solution to a customer is the best possible time to sell education," he said.

Mountford said SIP, the third prong of Cisco's strategy, was about moving customers to solution services. He said this would yield more margin from installation and professional services than traditional maintenance.