Building Subscription Based Revenue

Building subscription-based revenue for businesses is on the rise post pandemic. On Wednesday 1 June in Sydney and Wednesday 6 July in Melbourne, Dicker Data hosted the first Connect Event, facilitated by Yasser Elgammal, A/NZ General Manager of Sales, Cloud and Vendor Alliances, Dicker Data. The theme was on building subscription-based revenue for businesses.

Keynote speaker Mark Iles, Executive Consultant and Industry Analyst, Tech Research Asia led the session looking at the industry’s macro and transitional initiatives in 2023, what end users are looking for in their technology partners and the top tips around subscription revenue models businesses need to adopt for long-term success.

Every challenge opens opportunities

The ongoing global chip shortages and supply chain constraints continue to impact the IT industry and business cash flow.

Kickstarting the event, Yasser Elgammel said, “We get that a shortage in supply prevents partners from delivering on end-user needs and restricts revenue. Speaking to partners, we understand there is a movement to secure 50 percent of income from recurring revenue. The industry is seeing a clear need for predictable monthly revenue.”

Mark Iles presented insights from Australia and New Zealand where 150 channel partners shared their priorities in 2022/23. Along with navigating supply chain and IT skills shortages, the primary response was achieving annuity – addressing challenges in translating top line revenue to bottom line profit and valuation.

Mark Iles stated the IT market is ripe for change and transitional initiatives and the future is in “as-a-service” offerings, from technology infrastructure, products and devices to software and services.

Mark Iles said, “Analysis of IT spending forecast data suggests Australia will break through the $100b mark for the first time this year, while New Zealand is expected to hit $14b. Additionally, Australia’s software spend alone jumped from $3.1b in 2018 to $5.7b in 2021.”

Reviewing your operating model for long-term, sustainable growth

As IT spend is accelerating, now is the opportunity to reshape business models to secure long-term and consistent revenue streams. Mark Iles said, “When you look at total IT spent, 70 percent is corporate enterprise and 30 percent is SMEs. This SME figure represents $30b worth of business, a tremendous opportunity, particularly as technology is becoming complex and SMEs are outsourcing IT as a cost-effective solution. This is an ongoing trend with forecast compound annual growth.”

Dicker Data is ahead of this curve. With the changing economic landscape, focus on annuity, IP and pressures to mobilise quickly, Dicker Data is driving more support to the channel through Dicker Data Financial Services (DDFS), a tailored monthly, scalable device and infrastructure finance program offering partners and end-user financing options.

DDFS allows for financial predictability and cash flow optimisation transforming CAPEX investments into manageable monthly payments at competitive rates.

Yasser said “SMBs and end-users are moving from CAPEX (Capital Expenditure) to OPEX (Operational Expenditure) solutions. Dicker Data is helping partners accelerate recurring revenue streams and profitability margins by leveraging DDFS to build, manage and package hardware, software cloud and subscription services in competitive as-a-service and end-to-end consumption models. While end-users are empowered with cutting-edge technology at scale to work smarter and more productively, our partners can increase their competitive-edge, profitability, and up-selling opportunities”

DDFS exclusively provides the only direct financing model in the industry, with capacity to put its own balance sheet into every deal with no outsourced banks, brokers, or leasing companies.

How Dicker Data experts help you build subscription-based models

As a value-added distributor, offering access to the world’s leading technology vendors, partners can leverage their partnership with Dicker Data to offer end-users market-leading and exclusive buying options and models built to be fit customer’s needs. To name a few of these vendors, Arcserve, Check Point, Cisco, Citrix, Microsoft, RSA, Trend Micro, Veeam, Veritas, VMware and Zoom. 

Here’s a glimpse on programs that enable Dicker Data partners to build a subscription revenue model, from vendor’s you work with:

Arcserve

• Training and resources – leveraging three decades of award-winning IP, partners can access go-to-market campaign assets and marketing funding opportunities to capture market share in the growing subscription-based market

Check Point

• Harmony Email and Collaboration: activated in one click and deployed within five minutes to reduce phishing and increase security. Partners can easily demo and sell the offering with a multi-tier consumption pricing model along with a multi-tenanted portal.
• Incident Response as a Service (IRaaS): a leading email security solution offered at scale to track malicious activity, restore emails from quarantine or mark as suspicious backed by analysts reviewed within an SLA in five - 30 minutes

Cisco

• Managed Service License Agreement (MSLA): simple way to buy software and resell as a service solution using a pay for what you use consumption model with no upfront fees or monthly costs
• The Provider program: rewards partners with an automatic discount, marketing funds and resources, to assist in building recurring revenue streams
• Enterprise Agreements (EAs): saving partners time in negotiating renewals, while giving their customers an easier way to buy, manage and scale their Cisco software subscriptions

Citrix

• Full service go-to-market program: helping build Desktop as a Service (DaaS) solutions so end-users can work remotely and securely access data and apps from anywhere. This includes business planning, productisation, solution design and technical enablement, and sales and marketing planning including demand generation.
• Dicker Data Sellers Club: a reward program for Citrix Partners, recognising partners as they grow their business with Dicker Data and Citrix

Microsoft

• Microsoft Cloud Solution Provider (CSP) program: transforming how partners work with cloud, grow their share of wallet with current accounts and attract new name revenue
• Ascend: quarterly flagship partner thought-leadership and training enablement programs with a tried-and-tested approach to growth acceleration for Microsoft resellers
• Marketing-as-a-Service: support to plan and execute go-to market strategies for Microsoft solutions, to improve targeting and increase conversions rates

RSA

• ID Plus Subscription Plans – cloud solutions to support digital transformation plans, offered in three levels tailored to fit every identity and access management requirement. These solutions can be deployed in the cloud, on-premises, or hybrid with an open, extensible identity platform and include:
  • ID Plus E1 - secures access to cloud-based applications, systems and users

• • ID Plus E2 – combines best-in-class IT with frictionless user access and identity protection in cloud or hybrid environments
  • ID Plus E3 includes – purpose-built for security-first, highly complex environments that require future-proofed security

Trend Micro

• Trend Micro MSP Program – empowering partners with a single platform to purchase, deploy and manage Trend Micro customer licenses that are subscription based and volume pricing
• Worry Free Services Advanced – Entry level endpoint and email security solution sold as a bundle providing customers with a managed security solution from a global leading solution
• Worry Free XDR –Bolt on to Worry Free Services Advanced where all data collated from endpoint and email goes through the investigation and process managed by partners through the Trend Micro Remote Manager
• Co-Managed XDR –Bolt on to Worry Free XDR solution managed by the Trend Micro 24/7 threat experts as a white label solution for partners, with additional monthly reports that can be shared with customers

Veeam

• Veeam's Cloud and Solution Provider (VCSP) program – addressing partners need and opportunity to provide data protection services to customers, help build reliable, revenue-generating businesses and leverage innovative solutions from Backup as a Service (BaaS), Disaster Recovery as a Service (DRaaS) to Service Provider Data Protection and Off-Site Backup
• Veeam's Universal Licensing Subscription – a flexible “per workload” annual subscription license that helps increase annual recurring revenue (ARR), remain competitive with an Enterprise Plus offering, stay relevant with industry leading subscription licensing and reach untapped customer segments and unlock untapped customer segments

Veritas

• True Forward Subscription model – helping partners secure net new customers by enabling customers to transition to Veritas without commercial cost of transition, with the opportunity to ramp up their usage over time above their original purchase and only charged for their excess usage from the agreed future review date
  
  
• Veritas’ Partner program – incentives to sell subscriptions, including: double the opportunity registration rebate for subscription billings; and triple the recognition of subscription billings to qualify for higher partner tiers and Growth Target Rebates

VMware

• VCPP: tailor-made programs to deliver hosted infrastructure solutions packaged “as-a-service” with opportunity to value-add and upsell on month-to-month OPEX rather than CAPEX basis

Zoom

• Zoom Up: annuities-based program for partners who wish to be the billing agent for the customer
• Zoom’s Sub-agent: partner referral programme where Zoom acts as the sales and support arm to provide customers with the best in Video led communications

Keen to learn more? Register for TechX 2022: Innovation Accelerated. This is your opportunity to hear from industry analysts and tech research agents, live and in person from each city. It provides a roadmap to what’s next in our local partner community plus you can hear from senior executives from our top tier sponsors and how they’re helping you to accelerate Australia’s digital transformation.