SAS Ventures into Channel WatersBy Scott Ferguson | Print
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The independent software company is looking to extend its reach, and revenue, in the growing BI marketplace by bringing VARs on board.SAS Institute, a longtime independent software maker of business intelligence and data management solutions, is venturing into the channel for the first time, with a full program designed to attract VARs to its products.
The Cary, N.C., company announced Aug. 28 that it had recruited about 25 VARs, system integrators and independent software vendors as part of the new channel program, which will concentrate on horizontal sales of BI and data warehouse solutions.
Several of the new SAS partners told The Channel Insider that they were impressed by the company's line of products, the degree of technical and support capabilities that SAS is offering VARs, and its aggressive pricing to help SAS' solutions compete in the marketplace.
Although SAS has had dealings with partners in the past, this is the first time the company has opened part of its product line to resellers as a way to tap into the growth in BI, Jim Davis, senior vice president in charge of marketing at SAS, told The Channel Insider.
"There are a lot of increasing opportunities and we can't possibly continue to cover all these possibilities with just direct sales," Davis said. "We had resisted [channel sales] for years. We had VARs knocking on our door for years trying to sell our software. This change is based on what's happening in the marketplace."
SAS earned about $1.7 billion in revenue in 2005, according to company officials. The goal, Davis said, is to increase revenues to between $3 billion and $4 billion in the next five years, with 15 to 20 percent of that from channel sales.
For most of its history, SAS has used direct and what the company calls "sell with" partner sales to bring its software into the market. The only way to expand the business, Davis said, is to reach out to the channel and develop new partnerships.
To help develop this channel program, SAS hired Miles Mahoney in January and installed him as vice president of strategic alliance and channel divisions. Mahoney had previously built channel programs for Borland Software, Business Objects and Crystal Decisions.
The program will focus on SAS Enterprise Intelligence Platform, which includes BI, data integration and advanced analytics.
Davis did not break down how much money SAS is spending to start the partner program, but noted that the company would offer dedicated channel marketing, advertising and pre-sales, along with a summit meeting at its corporate headquarters later in 2006 to attract more VARs.
The vast majority of SAS' revenue comes from customers renewals. The company will allow VARs 25 percent of the a customer's renewal fee if the reseller was responsible for the initial sale and maintains customer satisfaction, and if the VAR achieves a certification level with SAS.
Although known as a provider of analytical and BI solutions for enterprises, SAS will start by focusing its new channel program on midmarket companies and other horizontal markets. SAS defines midmarket companies as being those with $1 billion or less in revenue.
The company plans to open up more vertical markets to VARs in 18 months. For now, most of that business will stay with the company's direct sales staff.
By the end of 2006, Mahoney said SAS would like to have an additional 25 VARs in the partner program and continue to grow from there.