Intracom Builds Channel with Unorthodox Strategy

By Pedro Pereira  |  Posted 2006-12-14 Email Print this article Print
 
 
 
 
 
 
 

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The vendor markets its Intellinet and Manhattan brands through VARs but maintains its own distribution infrastructure.

A salesperson visiting a potential client typically requires some configuration of his or her notebook to gain Internet access through the client's network.

A little-known vendor, IC Intracom, is working to eliminate this time-consuming step with a new Internet access device called GuestGate.

GuestGate provides users with quick Internet access through the use of a password while protecting the network from the potential security threats that accompany granting access to outsiders, according to Intracom.

The company has priced GuestGate at $199 and is banking on the device's becoming a door opener as it steps up recruitment of channel partners. Intracom, which was founded in Germany about 20 year ago, sells its products exclusively through the channel.

The company has an unorthodox approach to the market. It doesn't sell through large retailers such as Best Buy or CompUSA Management Company, and bypasses distribution to deal directly with VARs, integrators and independent retailers.

In addition, Intracom, with U.S. headquarters in Oldsmar, Fla., may be the only IT vendor that offers a lifetime warranty on all of the 2,000 products it builds through subcontractors in Asia.

"We are confident in the quality of our product," said Intracom CEO Michael Thiel, who owns part of the company. "We have hundreds of employees who have formal training in quality assurance."

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Intracom sells its products under two brands: Intellinet, which covers networking and wireless gear, including GuestGate, and Manhattan, which includes cables and PC components and add-ons.

By bypassing distributors such as Tech Data, Ingram Micro and Synnex, Intracom retains control over how products are sold, Thiel said.

It's also a way to protect the profit margin of the VARs and integrators carrying the brands, he said. Any Intracom partner that isn't getting comfortable double-digit margins, Thiel said, is doing something wrong.

"The angle that we choose is they make more money if they're selling our product," Thiel said.

Lyle McIntire, director of network solutions at 2-Way Communications Services, a voice and data solution provider in Newington, N.H., said his company started carrying Intracom products about a year ago after he came across the Intellinet brand while working with a partner. McIntire gives the vendor high marks for its price points, margin opportunities, and sales and technical support.

2-Way also sources products from distributors such as Synnex and Tech Data, McIntire said, where the treatment is decidedly different from the attention he gets at Intracom.

The large distributors typically have new salespeople to handle what for them are the smallest accounts—2-Way does $2 million in annual revenue—and those sales representatives may change as many as three or four times a year, he said. With Intracom, 2-Way has had only one sales rep so far.

"It's like they are a small business and they treat you as if you're a small business," McIntire said.

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As was the case with 2-Way, word of mouth has played a big role in introducing the Intellinet and Manhattan brands to the channel. Thiel said the company also uses the phone, e-mail and the postal service to get marketing materials in the hands of VARs and integrators.

Intracom, however, has not pushed too hard to increase its number of partners because the company has focused more on pushing more business through existing partners by attuning them to complementary products that they should be up-selling to customers when making a sale.

"The concept is really simple: Sell more to the same people," Thiel said.

That's not to say the company has a small number of channel partners. Intracom, whose world headquarters are in Halver, Germany, has about 40,000 partners globally, 2,500 of which are in North America, Thiel said.

Thiel said he expects GuestGate to catch the attention of other solution providers in North America, paving the way for the vendor to sell more of its products through them.

He said he believes in the potential of GuestGate because of the growing need for wireless access in places such as airports, restaurants and hotels, where increasingly that access is being offered for free. GuestGate replaces hotspot gateways typically now in use with a simple-to-set-up solution, he said.

 
 
 
 
 
 
 
 
 
























 
 
 
 
 
 

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