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Netmagic treading the channel ‘path’ for business growth

Shantaram Shinde, India Channel Head – Netmagic (An NTT Communications Company) shares with VARINDIA the company’s channel perspective and how Netmagic has been on a winning streak after aligning its business model with that of the channel-


How has Netmagic started 2017 with regard to the channel ecosystem or any specific channel strategy that you would like to share?


Yes, we made good numbers in terms of our channel business last year, and that is a good sign. The current structure of the channel ecosystem that has been there from the last 7 to 8 years will still remain the same. But the maturity level in our partners is clearly visible now. We have a good number of partners, around 130+ partners. Almost 75 to 80% partners are contributing to our business, who happens to be our active partners. This year we intend to take our channel business contribution to 30- 35%.


Secondly, we have categorized the partners as per their strength, which will help us in aligning our channel programs, marketing activities, events, EDMs and all the activities. For example, we have created a few categories like cloud service analysis partners, security service partners, application integration partners and so on. So if we see a good scope for SAP HANA implementation, that’s where our application integration partners will help us. A partner can get himself qualified in multiple categories; for instance he can qualify in cloud applications area and at the same time in application integration space too.


Besides, we do many specific activities for the partners. Like, we have increased our channel commission effective from this year. We have increased our percentage of commission in certain categories of products. We are also increasing our engagement more with our partners specifically this year.


We have also categorized partners based on the numbers they have delivered in the last couple of years - into P1, P2, P3 categories, where P stands for priority. The engagements and spending of marketing finance will happen in P1 category of partners. We are also going one step forward and creating the incentive reward program for our channel partners.


Is Netmagic a channel centric company completely?


We are a channel friendly company; initially there have been a lot of challenges when we were slowly inducting channel partners in our business model, but in the last 8 years we have evolved a lot. Now we handle not only the partners, but also the distributors. So we have both distributors and partners in our partner network. Ingram Micro, Inflow Technologies, Avnet are the distribution companies who are also our partners. Partners who have done services earlier can easily align with us. At present, the channel business contributes to over 20 percent of Netmagic India’s overall revenues. We have a roadmap to increase that business to 30-35 percent by the end of this fiscal year. Taking up the channel contribution is what our aim is.


In the services division, we want our channel to work closely with the sales team at Netmagic. Product delivery is done by the Netmagic service delivery and service operations team, unlike in other product companies where you push the boxes and send those to the partners and then the partners decide what to send, where to send, when to sale and so on.


How would you define the role of your partner?


The role of our channel can be defined in two ways. Firstly, our partner identifies the opportunity and then brings to us. We jointly work and close the business. Another way is that a partner enters into an opportunity and takes it to a certain level by making the value additions to it. They involve Netmagic for any kind of documentation work or where it feels that Netmagic should step in at any stage of the delivery process. This is from a perspective of a partner to Netmagic.


From Netmagic to partners, there are opportunities in services delivery and services operation stage. There are times when we require the partner’s help to complete and fulfill delivery commitments. We do not do the hardware AMC, but most of the partners do.


Again, for instance, I have a presence in Hyderabad directly, but do not have a direct presence in Kochi. So in those places, where I do not have direct presence, our partners will help in service delivery commitment.


Lastly, in system integration, we take the help of the partner community while delivering hardware, completing hardware orders and also in govt implementation. This is how we define the opportunities flowing from Netmagic to partners.


You said that you are working with the total number of partner 130 +, so are these the number of partners you are working with in India?


We have signed up a lot of partners, but the 130+ are our actively engaging partners. Going forward we would like to add more to this number. We are thinking of 25-30% increase in active partners.


We also have categories of partners like premium partner, elite partner and referral partner. Referral partners are mostly the transactional partners, also called affiliate partners. Further, the active partners would be a part of the premium, referral and elite categories of partners.


Most of our channel initiatives are aimed at driving the channel business. We also do a lot of marketing activities for our partners and customers and are targeting largely our cloud partners that offer SaaS services, IoT services, digital india, Machine to machine, BI analytics, and many more who are called the new age partner community.


What kind of channel presence do you have in tier 2 and 3 markets?


Primarily, the whole objective of the channel community is to reach out to the tier 2 and 3 markets. Most of our partners are appointed to cater to these markets where we don’t have much presence.