Exclusivity always has been a sought-after quality – usually for the right reasons. But every day we get bombarded with “exclusive” offers that are available to anyone whose money is green. For the most part, these are harmless sales pitches, but sometimes the objective is greater control of the supply chain and, by extension, higher prices to you, the consumer. So, I always become uneasy when large vendors and service providers start demanding exclusivity from integrators, value-added resellers and similar members of the indirect sales channel whose job is to help you make the right technology decisions for your company.
Some vendors and providers are kicking the tires of channel programs that do exactly that. To gain access to their offerings, channel partners would have to tell competitors to take a hike. As it becomes increasingly possible to fit representatives from all the carriers into one phone booth, the net outcome – at best – only can be a further reduction of choices for customers. At worst, the result could be channel partners pushing the wrong solution for your business because they cannot sell you the right one.
Every company would prefer to have absolute loyalty from all its customers as well as from anyone who stands between it and its customers. I’m OK with that concept, because in a system of free enterprise, vendors are forced to improve their products and services to win business based on merit. But these exclusivity packages are not about winning based on merit. They’re about winning business because somebody sold his independence and is no longer the honest broker his customers pay him to be.
Remember when voice-data convergence arrived? In addition to the technology convergence there was a lot of discussion about converging business models. In one corner, you had the fast, agile data model that thrived on creativity and competition. In the other corner there was the telecom model: quasi-oxcart-driven, protected territories, open to creativity only as far as things continued to be done in the same ways as before. This was a bad rap for some forwardthinking telecom people, but there was more than a kernel of truth to the overall characterization.
Most of us thought the success of convergence would bring about the dominance of the data sales model, and to a large extent it has. But the renewed interest in contractual exclusivity is not a good sign – not for the user, not for the channel, and not even for the service providers who can use it as an excuse for not improving their programs and offerings.
So I’m issuing a call to customers, channel partners and forward-thinking telecom people: Contractual exclusivity is not the proper course of action. The channel needs to be independent to meet its obligations to the customer fully. If vendors and service providers need to lock down channel partners to succeed, they’ve likely got much bigger problems affecting the loyalty of their channel.
Presti is a recognized channel consultant who helps technology companies build successful go-to-market strategies. He can be reached at kpresti@att.net.
