VMware Ditches ‘Hit And Run’ Sales in Favor of Customer Life Cycle

VMWARE EXPLORE BARCELONA — VMware is stepping up its efforts to move partners to a SaaS and subscriptions model. The firm is asking partners to focus on the customer life cycle, said Andy Corcoran, VMware’s UK&I channel sales director.

“Traditionally, you’ve seen channel programs reward the transaction. But in all honesty, that has occasionally driven a hit and run culture. [That] is, ‘thanks very much for your order, see you in two-and-a-half years before you refresh,’” said Corcoran. “If you want to remain relevant to a customer in a SaaS and subscription world, where you can be turned off pretty quickly, you need to make sure the partner network is incentivized to stick to the customer right through the journey.”

To better ensure this, VMware last year launched customer life cycle incentives for partners. These reward them for design, implementation, management and continuous support for the lifetime of the deal. Corcoran said the uptake of the customer life cycle incentives “has been fantastic.”

VMware's Andy Corcoran

“We have a partner community that is engaged right all the way through the life cycle,” he said. “[One] that is fundamentally interested in ensuring customer success, so that the renewal happens at the end of that life cycle. Program-wise, [it] has been a great way of trying to focus the partner community and saying, ‘We’re changing what we do.’ It’s not a perpetual license model; the hit and run won’t work. You have to maintain your relationship with that customer. And that will be done through maintaining constant communication.”

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Partners Stepping Up On Services

Corcoran was speaking to Channel Futures at VMware Explore Barcelona. There, Broadcom CEO Hock Tan promised to invest more in the channel, post-acquisition of VMware. Corcoran said this was “about putting your money where your mouth is.”

For partners, this will mean stepping up on service delivery, said Corcoran. One example is Cross-Cloud managed services. Launched in 2023, these are solutions and incentives, aligned go-to-market activities to help partners expand their managed service practices.

“Cross-Cloud managed services are about being able to put the life cycle into the hands of a partner. It’s a full end-to-end managed service around taking the customer’s cloud journey and making sure that whatever it is that they want to do, we’re providing the right level of support for them to do it. That’s about enabling the partner to do that for us, because we simply will never have the scale to be able to do that.”

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Another offering becoming more prevalent among partners is a move to cloud service provisioning, said Corcoran.

“There are partners that have done a really good job of producing license-as-a-service offerings. They’re quite disruptive to the traditional way of delivering [licenses]. But having a rental model shows exactly what the consumption is, what you’re using, how you’re using it and being billed specifically for that. It is a part of the cloud sort of panacea that we’ve been aiming for quite a while. And we’re able to try and deliver that for the multicloud world,” he said.