Partner - Two ASPs Blaze Trail To Agents

Posted: 07/2001

Partner Channel

Two ASPs Blaze Trail To Agents
Innovators ZLand and Evoke See Close Fit for Telecom Partners

Like other sectors, ASPs have felt the effects of the telecom shakeout. However, ZLand Inc. (www.zland.com) and Evoke Communications Inc. (www.evoke.com) have emerged from the chaos with strong growth, unique products and channel partner programs.

“As an agent, it is a good idea to learn about the ASP model and the companies that are making it happen,” says Brad Miehl, president and CEO of master agency TheAgentsNetwork (www.agents-network.com).

“Keep in mind that ASPs will be looking for efficient distribution,” he adds. “If we do our job well, the agent channel is a great place for them to look.”

ZLand, a seven-year-old ASP focused on small to medium-sized companies, is one such ASP. It offers “click and build” applications for business management that can be installed in five to 10 minutes. The 160 applications fit together and offer interconnecting databases with no customization required. A customer can enter orders, update databases, access accounting and payroll and perform order fulfillment, using common formatting across the organization. The package is delivered and accessed via the web.

The application standardization is unique in the field, says John Veenstra, ZLand president and CEO. Further, he explains, ZLand is the only ASP in its space that owns its own software.

“We have a few competitors left after this economic shakeout, but [who] we compete against are people reselling Microsoft Office or PeopleSoft,” he explains. “We focus on an app that costs $50,000 or below. We own that space and certainly we’re the only ones with control over that application.”

In one such arrangement with Sprint Corp.
(www.sprint.com), Sprint E|Solutions and ZLand will build a network operations center to host ZLand’s applications, with access, transport and collocation services on the Sprint network.

ZLand will also receive Sprint sales support to market to Sprint’s 23 million-strong customer base.

In the last six months the company has begun to expand, aggressively recruiting agents and signing marketing deals to help tap the Sprint base and other marketing areas.

ZLand has had a franchise channel for six years, which sells ZLand’s product “as-is,” performs the installation and systems integration if necessary, and gives service, much like a car dealership. Agents will have no expertise requirements, however–as new franchises, Veenstra says agents need only sales experience.

In addition to the Sprint agreement, ZLand expects to forge other carrier relationships, sign large reseller organizations as franchisees and pursue distribution agreements with name-brand companies. The latter will use ZLand’s delivery methodology and dealers to distribute customized packages to remote offices and salespeople.

Another firm using the ASP model is Evoke Communications Inc. (www.evoke.com), a conferencing company that adds controlled visual elements to traditional audio services. Evoke delivers and shares business applications via the Internet or on a network.

For example, in displaying a PowerPoint presentation or other document, the moderator can control what participants see. The service allows participants to modify in real time a document, such as a contract, giving similar functionality to in-person meetings. Other options include interactive web touring, polling, the ability to conduct a survey and post the results and a whiteboarding feature for real-time drawings.

“All of those things add up to making what would be a normal audio conference effective, because you’re adding a productivity element,” says Evoke co-founder, president and CEO Paul Berberian.

Evoke offers wholesale and commission-based alternate channel programs. Indirect methods generated 12 percent of its revenue

during the first quarter, while the company grew 11 percent overall.

Berberian explains the relationship is the hardest part of the sale, which is why channel partners offer value to Evoke.

“Our offering sells best when displayed or demonstrated; you don’t just buy it out of a catalog,” Berberian says. “An agent’s value is that they already have established relationships in a telecommunications capacity, and thus are a trusted source for new and innovative apps.”

Evoke considers itself a unique ASP because its software offering is not something that requires changed customer behavior to use.

“In other words, the learning curve is extremely short,” Berberian says. “Historically, people have just e-mailed out a PowerPoint and said, ‘OK, let’s go to page 10.’ What we do is offer a quick way to make that same communication idea more effective. If we were changing behaviors, I don’t think we’d be as successful in this economy.”

Evoke expects to reach $43 million in revenue this year, up from $18 million in 2000.

In addition to a being a growing market, Evoke’s ASP service benefits agents in customer retention.

“This is an extremely unique offering,” Berberian says. “We could even use the term ‘next-generation’. If an agent has teleconferencing relationships and they don’t have those web pieces, as a value to the agent it’s a way to introduce clients to the next generation and keep that relationship going.”

ZLand’s Veenstra says applications automatically bring stickiness.

“Some agents have as high as 80 percent churn rate in their account base, and they’re having to make 10 or 15 calls to get an appointment, to sell a commoditized product that has shrinking margins,” he explains. ZLand has performed trials that show selling its offering brings the churn rate down to 5 percent, he says.

“People that install an application will rarely change it–it’s just too complicated,” says Veenstra.