McAfee's Profitability Stack Aims at Protection, Predictability

With a new Profitability Stack, the company is intent on boosting partners’ front- and back-end profits. By Colleen Frye

Security solution provider McAfee Inc.'s new Profitability Stack, announced this summer, “is all about protection, predictability, partner investment, and ROI,” says Fernando Quintero, vice president of channel sales and operations for the Americas at Santa Clara, Calif.-based McAfee, a wholly owned subsidiary of Intel Corp. The Profitability Stack for SecurityAlliance partners integrates the company's profitability programs into one global offering and enhances automation; it includes deal registration, incumbency advantage, tiered pricing, teaming plans, rewards, and rebates.

Quintero says one of the goals of the new program is to help partners better understand where to invest, which he says is especially important for resellers targeting small and midsize businesses. “They [partners] have limited and finite resources, and there are a whole bunch of vendors trying to get them to sell their products. The question [for them] is, 'How do I allocate funds and resources correctly?'” Quintero says McAfee put the stack together to “help partners understand how to develop, grow, and be successful selling McAfee solutions.”

With the new stack, McAfee has “lowered the bar and widened the products available for deal registration.” Fernando Quintero, VP channel sales and operations, Americas, McAfee

MARGIN AND REBATE SPECIFICS
Partners serving SMBs first need to look at return on investment, which Quintero says “translates into, 'What return do I get on the front end?'” That is where deal registration comes in. With the new stack, McAfee has “lowered the bar and widened the products available for deal registration.” In addition to deal protection, the company offers up to 25 percent of additional margin on top of standard channel margin for partners that secure incremental new business and additional margin for suite upgrades.

Quintero says the stack is also designed to help partners achieve ROI on the back end with more longer-term predictability. With incumbency advantage, partners get additional margin on the first renewal to help them build loyalty through customer retention and to provide competitive advantage when renewing. Also, with the teaming plan, when McAfee identifies opportunities it will work with and reward Elite- and Select-level partners “who can help us get a technical demo or a high-level meeting.”

Rebates have also been enhanced. Now resellers can earn additional rebate dollars with the ACE (Accredited Channel Engineer) offering. “If you invest in technical knowledge there will be a reward,” Quintero says. Also, in terms of overall rebates, “the payout per node is bigger, and we also have other incentives that are eligible for sales and technical folks. We've paid out over $2.5 million over the last couple of years in McAfee rewards. We've expanded options on products you can get money from. The rewards component is available to tech reps as well.”

In terms of tiered pricing, a new automated pricing process allows distributors to make tiered pricing available to authorized resellers. Additionally, McAfee has introduced discounted (nonstandard) tiered pricing worldwide.

McAfee has some target goals for the new stack, and Quintero says the company tracks several metrics, one of which is deal registration as a percentage of eligible booking. “We've seen an increase across most of our territories. We've almost doubled the revenue with partners that are our focus partners; a lot has to do with programs they're registering.”

McAfee is also running a limited time promotion called Total Access. “We have some aggressive targets mainly at the SMB and commercial/midmarket,” says Quintero. “It's a combination of multiple endpoint solutions at aggressive prices.” The promotion is open to every partner, he says, and will run until December 25.

INTEL AND FUTURE PLANS
Quintero says the McAfee and Intel channel programs remain separate entities, but there is collaboration among the teams. “The key is optimizing collaboration,” Quintero says. “We work together in optimizing our engagements. The programs are different, but I think you will start seeing some bundles and joint offerings, but we'll be keeping some components separate.”

As for future plans for the SecurityAlliance program, Quintero says the mantra for next year is “simplify.” That is, McAfee will work with global teams to simplify the way partners are trained and enabled and how they achieve continuing education credits, and to make it faster for them to recover their costs. “Also,” he adds, “we have ambitious projects [planned] around our partner portal, to bring consolidation of the multiple tools we have on the Web.”