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Cisco boosts small business products and programs for channel partners

In an effort to boost its credibility as a small business vendor, Cisco launched several new products in its small business portfolios. It also offered several incentives and profitability programs aimed at helping Cisco channel partners to sell more effectively into the small business market.

Cisco channel partners that are looking to build out their small business practices got a boost at the Cisco Partner Summit last week.

Cisco Systems expanded new Cisco Small Business Pro product portfolios by announcing several new small business networking products that it hopes will build up the company's credibility as a small business vendor. Cisco Small Business Pro, a new partner-centric small business brand, launched last November.

The new Cisco Small Business Pro series products include the ESW 500 Series managed switch (with 24 or 48 Gigabit Ethernet ports) and the SPA8800 IP telephony gateway.

Cisco also announced the PVC300 IP camera, a surveillance product in the lower-end Cisco Small Business series. Cisco Small Business is the brand that is gradually replacing the Linksys brand.

The company also launched its new Cisco Small Business Pro Service, which offers small businesses three years of technical support and coverage for Small Business Pro products. In addition, Cisco offered several new small business incentives to its channel partners. It increased its rebates for Select Certified Partners in the Partner Development funds program up to $15,000. Cisco also created the Small Business Performance Accelerator, a global profitability program for partners selling to small businesses, and it extended channel financing terms to 90 days as part of a six-month "financing stimulus package" for partners that are participating in the extended terms financing program.

Cisco has struggled in the past to convince small businesses that it is a serious small business vendor. As one Cisco partner told last week, even if a partner is able to quote a price that beats the competition, small businesses often elect to buy products from competitors because they worry that Cisco is just too big to meet their needs.

"Cisco has taken multiple runs at the small business market, and they have historically invested heavily and not gotten much out of it," said Abner Germanow, research director with IDC.

Cisco has had success with midmarket firms, he said. Once Cisco tries breaking into companies with fewer than 500 employees, its sales efforts tend to stall. But small businesses that view information and communications as critical parts of their business do tend to be more open to investing in Cisco products, Germanow said.

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Cisco expands channel partner opportunities for small business sales

"But with that said, it's taken [Cisco] a long time to figure out the intersection between low-end Cisco products and high-end Linksys products," he said. "I think a lot of that has been fixed now. They view the small business market as an important market; it's just taken them a long time to figure out how to address that market, building products that are specifically designed for that small business market and not just Cisco 'lite' products."

"Our brand is not necessarily a household brand within the small business market, and we have to change that perception," said Mark Monday, vice president and general manager for Cisco's SMB business unit. "The feedback we had gotten before entering into this market was: 'You're too expensive for small business. You're too big to focus on me.' We are doing several things in that area and will continue to do more to change that."

Monday said Cisco now has a specialized sales organization dedicated solely to small businesses. It is focused on going out to small business partners on a worldwide basis and helping them understand how to sell to small businesses.

"We're doing a lot of end user marketing as well," he said. "You will continue to see us doing things through magazines and the watering holes where small businesses come together. And we will continue enabling our field organizations to make sure we get those marketing messages to the right theaters. We want to enable our partners to get the message out to small businesses. I don't know that we have all the answers yet."

Travis A. Earls, President of Deka Technologies, an Alpharetta, Ga.-based Cisco partner, said that Cisco still has some work to do to convince small businesses that it is a legitimate small business vendor.

"I'm not sure that [small businesses] have bought into it yet, and I don't know that Cisco truly understands it," Earls said. "All the large manufacturers have dealt with it before. The only people that can effectively sell to small businesses are other small businesses. I believe that is just a fact. The large companies – their infrastructure, cost structure and layers are such that it doesn't make sense for them to sell to small businesses. The reseller channel is the only way to do it."

Earls' company was originally a Linksys partner that moved over to Cisco when Cisco bought Linksys in 2003. Since Cisco gobbled up Linksys, Earls feels that he doesn't get as much support in trying to sell to small businesses.

"We got lots of support under Linksys," he said. "And even though our account manager has stayed the same [under Cisco] and our inside sales team has stayed the same, I don't know that we quite feel the love like I did when we were all under Linksys. I think that's probably because their territories are a lot broader now than they used to be, and the number of customers they have to call on is greater."

Earls said, however, that the Cisco brand has a good reputation for quality, if not for small business products specifically, and that has helped him sell small business products.

"When Cisco and Linksys came together," he said, "we immediately started selling the Cisco name because the Cisco brand carried with it a certain quality that Linksys didn't carry."

Let us know what you think about the story; email: Shamus McGillicuddy, News Editor

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