Business Boost: By automating service contract renewal quotes, Ingram Micro U.S. is helping its resellers increase business and strengthen their relationships with customers.
A chain is only as strong as its weakest link. Organizations that sell their products through a third party need to make sure that their resellers are on top of their game and making the most of each sales opportunity.
Technology distributor Ingram Micro North America was finding that its resellers were missing out on thousands of service sales opportunities. Especially in a difficult economy, the company couldn't lose out on this revenue, more so when it relates to annually renewable service contracts that hold ongoing annuity value. "If we could transform the time-consuming processes that kept [resellers] from capturing the full scope of renewal opportunities that were available to them, particularly with the 'low-dollar' service renewals, we could drive new profits and revenues for their businesses," notes Peter Gambino, executive director, advanced technology division and Cisco Business Unit, Ingram Micro U.S. Under the guidance of Paul Bay, the company's president, Ingram Micro kicked off an ambitious initiative to improve operational efficiencies in more than 3,700 resellers in North America, help them close more deals without adding human resources costs, and in turn deliver greater profits.
Further, Ingram Micro's business leaders wanted to strengthen the relationship between resellers and their end customers, helping the businesses better communicate with clients and remain up-to-date with customers' renewal needs. Bay noticed that tedious and time-consuming processes, for example, heavy reliance on traditional spreadsheets, often meant that resellers were not putting enough weight to the renewal of "low-dollar" service opportunities, which amount to less than $25,000 per year. These need to be kept up-to-date to make sure that customers are entitled to continued service protection for their products.
The company realized that thousands of these service contracts were coming up for renewal every month, potentially costing the company money and leading to a negative experience for customers since their IT resources were not protected by service agreements. The traditional spreadsheets being used to track contract expirations were at times plagued with inaccuracies or missing information.
In its search for an expeditious but long-term solution, the company decided to collaborate with service contract management technology provider MaintenanceNet to improve its Reseller Services Portal, allowing it to offer a way for resellers to transact and automate service quotes. The plan was to find a streamlined system that helps resellers proactively reach out to their clients to offer them service agreement renewals through a low-touch or no-touch approach that requires very little effort from sales agents. This required aggregating disparate data sources to create a 360-degree view of end clients and their service statuses.
In order to facilitate the renewal process, Ingram Micro wanted to automatically send resellers accurate and pre-validated renewal quotes, making it easier for them to reach out to customers and manage orders online instantaneously, a process that was previously taking hours or even days. The solution, AutoQuote, was deployed to all resellers as part of the Reseller Services Portal and alerts them about service expirations 90 days before the contract termination, giving them time to take action. "It delivers a goldmine of new opportunities that require little action and no real investment on the part of the partner, but adds significant business value," Bay says. To make sure that resellers are making the most of the new tools, Ingram Micro holds monthly training sessions. Further, the company holds participation contests with rewards. Stephen Yochum, senior vendor business manager at Ingram Micro U.S., explains that the rewards are based on renewed contracts as well as frequency of use of the Reseller Services Portal.
The financial gains were substantial, helping Ingram Micro gain revenue that would otherwise have been lost. Service renewals for a particular vendor increased by 135 percent last year over 2011. Last year Ingram Micro delivered more than $200 million in automated quotes to resellers each quarter, but the streamlined process meant that resellers didn't need to increase their staffing levels.
Further, this system is helping resellers drive better and stronger relationships with customers. "By staying on top of their customers' ongoing service needs, resellers are able to cultivate a sense of trust and stronger partnership," Bay notes.
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