NetSuite goes after channel

Cloud-based ERP and CRM vendor NetSuite (NYSE:N) has launched a new channel sales programme aimed at growing its UK channel community.
The UK SP100 programme includes a 100 percent margin payment on first year licence subscriptions with 10 percent on subsequent years. The new programme drops its old £2750 joining fee, provides free training, marketing support and a copy of NetSuite for new partners to run their business on.
However, the firm is vague over the size of its current channel and its targeted expansion. Merrill Kindred, EMEA channel director for NetSuite describes its current channel as “in the tens”. Although looking to attract more quality partners, the firm won’t clarify how many it aims to recruit although “it won’t be in the hundreds” says Kindred.
NetSuite will also continue its direct touch sales force alongside the newly expanded channel. Asked about the possibility of its direct touch competing against the channel, Kindred feels that they have “very clear rules of engagement” to avoid channel conflict and stresses that, “we look after our partners, we invest in our partners and it is a mutually beneficial relationship.”
The existing channel that works on a 30 percent annual margin will be excluded from moving to the 100 percent first year with 10 percent recurring model. Although, Kindred said she would listen to feedback from partners, she felt that existing partners were happy with this model. The existing channel will get MDF which will not be on offer to new SP100 partners, although both will get a form of deal registration.
Kindred believes that the new programme will be particularly suited to existing ERP and CRM focused partners who are looking for a cloud-based addition to existing on-premises solutions: “We want to get in front of them and tell our story,” she says.
Channel Pro comment
NetSuite is a highly regarded and definitely a “from the ground up” cloud application. However, the fact that it has a direct touch is not new, the size, shape and scope of direct touch is hard to fathom. The idea that it is going to recruit new partners and leave them on a different channel programme from the legacy partners could be a recipe for channel conflict.