Dell to launch service-attach rebate for partners
New rebate will reward resellers for bundling more of Dell's services with its products
Dell is introducing a new rebate to encourage its distributors and certified partners to bundle more of its services.
The incentive, set to launch in the coming weeks, will reward resellers for boosting their Dell services penetration rates and will be "stackable" with existing rebates, Michael Collins, vice president of strategy and channel at Dell EMEA confirmed to CRN.
"Distributors will be financially rewarded when they attach more of Dell's services to our products, and the same reward will be in place for our certified partners," he said.
The rebate is an evolution of a programme already in place, which focuses on Dell's ProDeploy and ProDeploy Plus deployment services, Collins explained. The new rebate, however, will cover Dell's full portfolio, from a range of services, from support to break-fix and professional services, he said.
The new rebate comes on top of a new-business rebate Dell introduced at the start of its fiscal year which pays 15 per cent on storage deals, eight per cent on servers and between two and four per cent on client products.
Rupert Mills, director at Dell Premier partner Krome (pictured), said his firm currently doesn't do anything with Dell services because they are a "direct clash" with a lot of the services Krome delivers as a reseller.
"We've discussed this with the services team and I also discussed it with Michael Dell when I had the opportunity to meet him a couple of years ago. His comment at the time was that there was plenty of market share for everyone and that Dell was interested in the very large-scale deals and shouldn't clash with us.
"Now, with their offering services on some of the smaller deals, I suspect they're looking to incentivise people to use their team, but we honestly prefer to be able to stand behind what we've delivered and confidently say it's ours."
Stephen Hennessy, sales director at Dell partner Computerworld Business Solutions, held a similar view.
"Services is where we make a few pennies from Dell. This would be of interest for us, being something we already have in our employed base, even if we got a rebate," he said.
However, Stuart Rae, managing director at Dell Premier partner Nviron, welcomed the news, saying his firm has among the highest attach rates on Dell services in his area.
"We see this as a good thing. We have a strong services capability in house but we still need to layer Dell ProSupport and ProDeploy services on top," he said.
The services rebate is available only to distributors and Premier and Preferred partners, but its introduction comes at a time when Dell is on a mission to grow its base of non-certified, Registered partners.
Registered rewards
To this end, Dell recently extended PartnerDirect benefits to Registered partners for the first time. This means Registered partners buying through distribution will be able to access incentives, competency training courses, rewards and customer support.
Collins said the incentive comes in the form of a dollar-per-box payment, meaning the more Registered resellers sell, the more they earn.
"It's part of a broader channel strategy to drive a particular route to market that has, frankly, been under-developed in our western European business - that market being distribution," he said.
"Naturally, it gives us access to a customer segment we've under-served over the years: very small, small and medium-sized companies that typically put their trust in smaller and mid-sized SIs or VARs, and those are the partners we are referring to here."
Collins said about 1,000 resellers in EMEA had signed up at Registered level since the change was made, but stressed that the ultimate goal is to convert them to Premier or Preferred status.
UK the 'star performer'
The UK channel business has been the "star performer" for Dell in its current quarter, Collins added.
"Our channel business in the UK is doing exceptionally well this quarter"
"Our channel business in the UK is doing exceptionally well this quarter and is outperforming probably all other channel business across the rest of EMEA, and certainly outperforming the market. When I say a strong quarter, I mean high double-digit growth."
Collins said this could reflect the fact that the UK's net promoter score in its most recent NPS [net promoter score] survey in the channel rose nine percentage points to 75, ahead of the global score of 70.
As exclusively revealed by CRN, Dell was among the first vendors to confirm UK price rises in the wake of the Brexit-induced crash in sterling.
"This is not the first time we've had to work on currency volatility in EMEA," Collins said. "You can imagine dealing with this in Poland, South Africa and Russia, which have all had extreme currency volatility over the last 18 months or so. It's never easy, but it's something that needs to be dealt with professionally, with the end customer in mind at all time. They're the ones who need to work out how best to handle the changes as they manage their own roll-outs, budgeting and hedging."
Dell and EMC's $67bn (£50.6bn) merger is set to formally close in the coming weeks before the duo launch a joint partner programme on 1 February.
"After the formal close of the merger, we can collaborate much more effectively to make sure we are heading in the same direction," Collins said. "Today, we aren't able to do that so I'm very excited for day one of post-close and 1 February."