Cloud Partners: A New Breed of VAR

When asked recently what’s the hottest topic in IT impacting the channel I didn’t have to think twice…the Cloud.  I wrote ‘What Does Cloud Computing mean for the Channel?’ a couple of months ago — talking about the ability for just about anyone to write an application in the cloud and market it.  Google, Force.com, and Amazon have made that a reality.  And the Cloud will certainly generate buzz at Microsoft’s Worldwide Partner Conference 2009 (WPC09). Now, for the big question facing VARs.

Traditionally, VARs make their money on margins and services. What happens when there is little of either?  Six to twelve months ago I think a lot of VARs ignored the Cloud thunder — hoping it would subside. But with the dip in the economy (Channel Maven is being kind, we all know it’s a flat-out recession) and customers less concerned with physically owning the technology, the Cloud has made great strides.

Some traditional VARs have certainly embraced the Cloud and are attempting to work it into their business model.  But I also see a new breed of VAR emerging.  If I am in the market for accounting technology, who is the first person I am going to look to?  Probably my accounting firm.  Ten years ago, heck even 2 years ago, services firms such as accountants, consultants, and telcos wouldn’t even think of getting involved in implementing, integrating, or servicing technology for a client.  Today, the Cloud makes it possible with less technical expertise.

Hubspot is an inbound marketing tool geared toward small or medium sized business.  Invaluable tool, in the Cloud, minimal investment.  Can you see Greenpages presenting this to a prospect or customer?  Probably not.  Mike Volpe, VP of Marketing for Hubspot puts it well; “As technology moves to the cloud, there is less of a need for maintenance and installation services.  This means that the “Value  Added” in VAR becomes understanding the business challenges of the  customer, more than understanding how to make the technology work.  Similarly, any VAR strategy we implement at HubSpot will be to focus on partners who really understand marketing and can therefore add a lot of business value on top of the software.”

The struggle now becomes how do Cloud technologies identify this new breed of VAR and market a channel program that may seem to be a bit of a foreign concept?

One company, Lemon Operations has developed a program called Cloudy Channels.  Lemon is a global company that helps to identify and recruit channel partners appropriate for the organization.  The key here is they are focused on this “New Breed” of VAR; on the vendor side they identify and recruit them and on the VAR side they communicate the business benefits to acting as a VAR.

These VARs learn differently, they interact differently, and they sell differently.  It’s important to take that into consideration when building the channel organization for your Cloud based product.  Technology and channel needs are changing.  Those who adapt will continue to do well!

What has your experience been in the Cloud?  How has your business as a vendor or solution provider had to adapt?

Contributing blogger Heather K. Margolis, the Channel Maven, has led channel programs for major IT companies. She also has extensive lead generation and marketing experience. Follow The VAR Guy via RSS; Facebook; Identi.ca; Twitter; and via his Newsletter; Webcasts and Resource Center.