Vertical Communications was born a little less than a year ago, when the company’s leadership merged two longtime IP PBX players, Artisoft and Vertical Networks, in hopes of gaining critically needed traction in the crowded computer-based telephony field.
In recent months, the Cambridge, Mass.-based company has been busy–both working to merge the best of Vertical Networks Enterprise solution and Artisoft’s SMB product into a single, comprehensive solution and to improve and extend its support of the reseller channel to serve the SMB (small and midsize business) market.
“We are big believers in the dealer model for the SMB space,” said William Tauscher, chief executive officer at Vertical. “We’ve done a bunch of things to rearchitect how we are going to market [through the channel], and we are moving toward a common product that puts our two platforms together.”
As important as the technology piece is, the $60 million company has focused foremost on revitalizing its relationship with its resellers and improving the support it offers the channel.
“The biggest change is that there is no confusion and no mixed messages—and the message now is clearly dealer-centric,” said Dave Livingston, president at SST Computing, an Elite-level partner in Kennesaw, Ga. “There’s no question that Vertical Communications is basing its success on the success of their dealers.”
The company’s first move was to winnow down the glut of partners that had accreted during its days as Artisoft.
“Over the years, Artisoft allowed anyone who was interested to sign up as a dealer, and the end result was lots of dealers on the books that weren’t adequately trained, committed or resourced,” said Tauscher, adding that they trimmed their reseller roster by 70 percent. “We’ve requalified a much smaller subset of dealers, and told the rest that we don’t want them.”
Today, the company has about 220 dealers on its books and will be adding new partners as it finds companies that are willing to make an investment.
“In the last year, Vertical Communications has made a definite change in focus,” said Jim Weldon, president of CTI Solutions, an Elite-level partner in Sacramento, Calif. “Their mentality has changed. Now, they’ve got a limited number of resellers, and they are focusing on helping them be successful.”
The newly minted Vertical Business Partner Program offers three levels: Authorized, Preferred and Elite Partners receive free technical support, access to dealer discussion forums, pre-designed marketing programs and market development funds.
In order to participate, partners will be required to meet training and certification requirements.
Under the new program, Vertical Communications has committed to increasing its programs, as well as the potential margins that dealers can earn.
Incentives for VARs.
The company is offering its VARs higher margins as they increase sales, as well as additional margin for vertical market sales, said Livingston.
“There is intent to make the dealer profitable and successful,” he added.
As one of its first steps, the company implemented a CRM tool that interfaces with its design program.
The new tool helps track large deals coming through the channel in order to provide timely and appropriate aid to the reseller as the business opportunity progresses.
Dedicated “development representatives” are assigned to support roughly 20 to 25 resellers each, said Tauscher.
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These individuals help match resellers with pre-sales, field sales, inside sales and systems engineers as needed.
Vertical Communications has also developed a variety of new marketing tools.
“They’ve started to take their marketing pieces and replace them with information that is more up-to-date, pulled together, and attractive,” said Weldon.
“They are trying to put as many of the tools out there as fast as they feasibly can to empower us to go out and be successful.”
As a first step, the company has created a series of marketing resources, such as brochures, white papers and FAQs, aimed at specific vertical markets.
“The SMB market is really not something that you can market to horizontally,” said Tauscher, adding that initially the company will be focused on the opportunities in the legal, retail, real estate, financial and health care sectors, as well as call centers.
The company will be attending tradeshows aimed at these verticals and doing direct mail and marketing campaigns to raise customer awareness.
“[Vertical Communications’ efforts toward verticals] will help open up doors that I couldn’t previously,” said Weldon. “I think it’s an awesome idea.”
The company has also created its Vertical University training Program, which will provide online training to its resellers.
“With our engineers, there is huge expense to send them to the vendor headquarters rather than allowing them to train in their downtime,” said Livingston. “I like the Web training strategy a lot. It will save dealers a lot of money while improving the skills of those in the field.”
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On the product side, the company is planning to start to start providing servers and telephone hardware to complement its software this fall.
“We heard from our partners that they wanted us to take responsibility for the whole system,” said Tauscher. “We considered ourselves a software company, but now we are moving to support, sell and certify the server and the phones.”
The company and its VARs are betting this new strategy will result in a system that offers increased reliability and ease of support as well as cost savings.
“When you look at the components and optimize them for the system, certify and test them, and make sure you’ve eliminated the points of failure, then you make it the most stable platform it can be,” said Livingston. “That’s something that will buy them a lot of sales in the marketplace.”
Shortly, the company will also release an updated version of its TeleVantage IP PBX product.
“We spent most of our dollars are ensuring that the product is easily installed and supported and on the reliability equation,” said Tauscher.
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In addition, the company is evaluating programs to help its resellers capture reoccurring revenue.
“Resellers want to have reoccurring revenue, such as maintenance, support and centralized service,” said Tauscher. “There are several opportunities for our dealers to do that, so we are developing programs along those lines.”
Hailey Lynne McKeefry, a partner in professionalink.biz, is a freelance writer who specializes in technology and channel issues.