Registering for Protection

The very words “deal registration” used to be a euphemism for “vendors sneakily taking customer details and taking channel deals directly.”

But more recently, deal registration has changed its face and now represents somewhat of a solution provider cash-cow—if handled properly by the vendors.

Just this week a plethora of vendors have lauded their deal registration programs as real ways for the channel to make real money.

Of course, deal registration wouldn’t even be necessary if solution providers and vendors played a fair game in the first place, or in fact if customers stuck to their word.

A situation arose this week, where one solution provider I know of worked hard on a deal with a major client of his for some security software. After doing the consultancy, working out what the customer needed and didn’t need, the client then took the deal through a much larger solution provider, who (getting a better deal from the vendor) was able to undercut the original quote. All’s fair in channel and war, so they say.

The fact that the vendor allowed its larger solution provider to trample over the VAR who had already put the work, effort and relationship time into the deal is another column entirely—vendor behavior can leave a lot to be desired at times.

But, the point is that customers, solution providers and vendors are not whiter than white, business is business, and if competitors get half the chance to undercut your quote to win a deal, you can bet your bottom dollar that they will.

So while deal registration was formerly a dirty word, as business in the channel has got tighter and margin has become squeezed, it has become necessary.

Registration is there to ensure that even when VARs do undercut each other, whether it’s because they get a better deal through the vendor or distributor (no doubt those free tickets to see the Sox helped) or simply because they are offering differentiated value add to the deal, the deal registration program ensures that no work is wasted.

While each vendor has its own way of structuring its deal registration program, most offer additional margin to the VARs that registered the customer’s details, deal specifics and the sales forecast for the deal. Some don’t even ask for customer details, although most VARs see the value in being open in this process.

What vendors must make sure of however, is that firstly the deal registration is built into the channel program from the outset. A good example of this is VMware’s registration program, which is a major part of its channel strategy.

Another vendor that has its registration program right is IBM, under its Software Value Initiative; this allows different stages of registering, so when partners have collaborated, the partner who found the deal can register, alongside the one who influenced the deal and then the VAR that actually sold the deal—so at every stage of a deal the partner is not missing out and as every VAR knows, margin is margin, no matter from which part of a deal it comes.

The most important aspect of the deal registration is that vendors ensure they control what could be seen as a particular kind of “channel creativity”; VARs that simply get a sniff of a deal and register it as their own. Vendors have to make sure they check each registration to ensure that the right partner has registered the deal.

This mostly comes down to processes, but vendors must be ready to query some registrations by asking customers, checking any trading history between the customer and registered VAR or asking their own account management team.

Integrity and honesty from both vendors and VARs is the key to deal registration programs to ensure solution providers receive the maximum protection; otherwise it becomes just another form-filling, sales forecasting exercise for the channel.