Cisco SMB Business Gets Updated Sales Coverage Model, New Investments
Cisco partners are marketing to clients that need technology outcomes just as much as the enterprise but lack the same IT staffing.
![SMB, Cisco SMB SMB, Cisco SMB](https://eu-images.contentstack.com/v3/assets/blt10e444bce2d36aa8/blt1ed2408e17b64c24/6523ecc4c0975706a478a8db/8-SMB.jpg?width=700&auto=webp&quality=80&disable=upscale)
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Andrew Sage, Cisco vice president of global distribution and SMB sales, said SMB is already a “multibillion-dollar” business for the company, with double-digit growth.
He and his team have been stressing the upside of the segment to Cisco’s senior leadership team. And they’ve brought top Cisco brass into the SMB strategy.
“[CEO] Chuck Robbins and [chief partner officer] Jeff Sharritts and the executive leadership team have decided that in our new fiscal year 2024 (which just started), we’re going to make an incremental investment in this space to do the things we need to effectively serve the needs of these customers and help them in their transformation,” Sage said.
Sage shared Cisco’s “Scale” coverage model for SMB. Partners function as the first layer of support and interface for the customer. Territory managers support those partners. Sage describe them as a sort of regional CEO.
“… [they are] there to support partners that are selling to the customers, help them if they need a face in front of that larger opportunity, bring the resources to them to help to drive demand in their business, or drive support if they need it or escalations if that is required inside of the company,” Sage said.
On the outer layer, business development reps, sales acceleration personnel and practice specialists are standing by to engage with partners and their customers.
Moreover, Sage said many of the latter roles are brand-new. He said Cisco has hired more than 100 people in sales acceleration this year.
Eighty-five percent of Cisco SMB customers are actively engaging with Cisco’s SMB website, according to Cisco vice president of global SMB and partner marketing Luxy Thuraisingam.
That website content is now live in 16 countries, Thuraisingam said.
Thuraisingham outlined to Channel Futures earlier this year how the company revamped its SMB website to improve its bounce rate and usher customer leads over to partners.
Part of that revamp meant simplifying the message, she said.
“We shifted our language to focus on what they care about: affordability, simplicity and flexible solutions,” she said.
Partners themselves are learning to simplify their messaging.
Bob Schroeder, vice president of product management at Spectrum Enterprise, said the service provider has worked with Cisco’s local product manager team to reframe how it markets Cisco products.
“As much as we want to talk about zero-trust network access, there isn’t a single customer that actually wants to buy that, Schroeder said.
Spectrum in recent years has developed a Meraki-based edge service offering. But Schroeder said the company is trying to avoid the alphabet soup that can overwhelm SMBs. The terms SASE and SSE in particular can cause more problems than they solve, Schroeder said.
“The acronyms go on forever, especially in the SD-WAN space. We love them, and Cisco loves them, and I think we naturally thought everybody loves them. The fact of the matter is, they don’t love them, at all. They really do want to talk about the fundamentals,” Schroeder said. “We’ve had to reengineer – frankly reimagine – all of our marketing. When we brought Meraki into our portfolio, we retooled all of the messaging to talk about security, the fact that it’s worry-free, cost-effective and that you can control it.”
While Cisco channel leaders made the point that SMBs want to talk about outcomes rather than specific technologies, technologists from Cisco are still on hand.
For example, Westervelt said that after Portland Internetworks sent out a marketing email using Cisco resources, a prospect reached back out to the company. Westervelt said the second conversation will involve a Cisco security specialist.
In addition to funneling customers to partners through the Cisco website, Cisco has offered to give them the SMB Experience Explorer tool it embeds on its own website.
The tool frames technology in four main outcomes: “The Hybrid SMB,” “The Secure SMB,” “The Remote SMB” and “The Smart SMB.” Upon selecting a desired outcome, customers go through a brief discovery questionaire, providing details about their current technology stack and needs.
And good-fit partners can put that tool on their site now.
“We took the tool that we’ve tested on our [own website] and said, ‘Hey, partners, if you choose and are investing in your digital property, we’d love to pass this over to you, so you can embed this tool into your website and drive those leads directly and start conversations.”
While Cisco’s two-year old agent/advisor route to market doesn’t strictly fall into SMB, the model is contributing to growth in that area.
Cisco in 2021 formed a partnership with tech services distributor Intelisys for its Webex UCaaS offering and later added Telarus. But the eye-turning news came when Cisco made its contact center offering available for agents to sell.
“Contact center is smoking hot right now and really in high demand. We’re seeing that agency route to market through Telarus and Intelisys in the U.S. really growing nicely. In fact, we had a really nice Q4 on the agency side,” Sage said.
Sage said Cisco is eyeing ways to expand its offer to agents.
“Right now, it’s really focused on collaboration. We’re certainly looking at security and other technologies. We will expand that, because we want to put that on the table as an option for a partner/MSP who would rather not have to deal with the transaction but just wants to have that managed by Cisco.”
While Cisco’s two-year old agent/advisor route to market doesn’t strictly fall into SMB, the model is contributing to growth in that area.
Cisco in 2021 formed a partnership with tech services distributor Intelisys for its Webex UCaaS offering and later added Telarus. But the eye-turning news came when Cisco made its contact center offering available for agents to sell.
“Contact center is smoking hot right now and really in high demand. We’re seeing that agency route to market through Telarus and Intelisys in the U.S. really growing nicely. In fact, we had a really nice Q4 on the agency side,” Sage said.
Sage said Cisco is eyeing ways to expand its offer to agents.
“Right now, it’s really focused on collaboration. We’re certainly looking at security and other technologies. We will expand that, because we want to put that on the table as an option for a partner/MSP who would rather not have to deal with the transaction but just wants to have that managed by Cisco.”
The Cisco SMB unit is seeing an increase in hiring and resources as the vendor addresses what it sees as a $30 billion market.
Cisco channel leaders and partners briefed press and analysts this week – before announcing the company’s bombshell acquisition of Splunk – about the trends they see with small and medium-size business customers and the partners who serve them. The online roundtable included a layout of Cisco’s new “Scale” coverage model that it introduced at its August sales kickoff. It also included a discussion of digital marketing resources Cisco has been offering to partners and how those partners are changing the way they market products to small businesses.
Cisco defines SMB customers as companies with a three-year “wallet potential” of $200,000 or less, or $50,000 or less in annual bookings. And Andrew Sage, Cisco vice president of global distribution and SMB sales, said those companies tend to be a bit larger than the one- or two-person shop.
Cisco’s Andrew Sage
“I think that our technology and our partners’ capabilities are much better suited to that slightly larger SMB that has started to move to the cloud and that would react to the value proposition that we bring with Meraki [and] Webex, for example, with cloud security for example, wrapped up in the services that [partners] provide to them,” said Sage.
He pointed to a nearly $30 billion opportunity for Cisco to engage with customers that want to engage in digital transformation efforts to move to the cloud and SaaS. And 20% of those SMB customers are entirely new logos for Cisco, Sage said.
“These customers are stamping to the cloud and stampeding to SaaS to do digital transformation. It isn’t something that we’ve always associated with the SMB customer. We kind of think of them as hanging on as best they can,” Sage said. “And the truth is that SMB customers are doing things they could never do before with technology. Because they used to have to buy servers and they had to buy licenses or they had to do custom programming that was complex and difficult. And now with cloud and SaaS, that’s no longer the case.”
The Cisco SMB business runs entirely through partners, Sage noted.
“There’s no concept of a named account in our SMB business,” he said. “We are really relying on partners to manage those ongoing relationships. We’ve got to make sure that we’ve got the support that these partners need when they need it to bring the solutions to the customers.”
Portland Internetworks’ Doug Westervelt
Doug Westervelt, president and CEO of Oregon-based MSP Portland Internetworks, agreed that SMBs are working with a more sophisticated technology stack than ever. It very much compares to that of a larger customer, Westervelt said. But the biggest difference is in staffing.
Cisco SMB Clients Are Cloud-Bound
“A lot of our SMB clients have the same needs; they’re moving their workloads to the cloud. They’re subject to security threats. But they don’t have the in-house talent to design and manage that,” Westervelt said.
Westervelt joined Spectrum Enterprise vice president of product management Bob Schroeder on the webinar to share how they’ve been working with Cisco and SMBs.
Sage said partners like them have their hands on a $4.5 billion market opportunity within that larger $30 billion total addressable market. That’s for helping existing customers evaluate their technology.
“… that opportunity is for partners like Doug and Bob to go back to their existing customers and ensure that we’re taking care of all of the requirements they have and using technology to enable all of these capabilities by being a little more broad in what we’re bringing to them,” Sage said.
Cisco has noted elsewhere that traditional resellers and integrators drive 60% of SMB revenue. MSPs account for 20% and communications service providers drive 15%. Back in the summer, e-commerce accounted for 5%. However, Sage noted that e-commerce grew 30% in the latest quarter.
Cisco notably announced the acquisition of observability provider Splunk on Thursday.
Investigate the seven images above to read about the latest initiatives and updates in the Cisco SMB channel.
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