Crexendo, now in the second year of its first channel partner program and with 68 active resellers, is preparing to refine its program into a tiered structure, according to Cassandra Anderson, director of channel sales. The goal, she says, is to develop some master agents, which aggregate purchasing to get better pricing and negotiate the evergreen components of a contract. “The new world of cloud and hosted VoIP has opened the door to telecom agents, but they all buy from masters, so getting into the master agent arena is important for a company like ours,” Anderson says.
Anderson took over the fledgling channel program six months into it, and in July will mark her first anniversary with Crexendo Inc., a Tempe, Ariz.-based hosted services company that provides Web hosting, hosted telecommunications services, e-commerce software, website development, and broadband Internet services for SMBs. Founded in 1995, the company was formerly known as iMergent Inc. and changed its name to Crexendo in May 2011.
Crexendo’s telephony product is Crexendo Cloud Telephony Solution. The company currently has three types of partners: referral, affiliate, and reseller/dealer. Resellers earn up to 25 percent of the recurring monthly bill every month for the life of the customer they generate. These are typically data VARs, managed service providers, and managed print providers. These companies “want to do telecom, but legacy-based equipment and traditional telecom is complex. The cloud eliminates the complexity and the huge investment,” Anderson says. “We help them get into telecom quickly and have immediate success.”
Path to Recurring Revenue
The reseller margin is Crexendo’s biggest differentiator, Anderson says. “It’s the top end without a tiered approach. We’re giving our partners the opportunity to maximize their profit—there’s no stick, only carrot. The VARs realize they have to enter the cloud market and don’t know how to do it. We help them ease into a recurring revenue [model]. It takes 24 months to build up enough recurring revenue to be sound. As they’re weaning off a transactional business and see more and more recurring revenue, we’ve helped provide a path for them to be successful.”
Crexendo aims to roll out the tiered program in the third quarter of this year, Anderson says. Master agents would receive the 25 percent and resellers/VARs would start at a margin of 15 to 20 percent. Existing partners will continue to receive the higher margin, she says. “We rewarded them a high payout because they were willing to go through the learning curve with us.”
New partners will not have a quota the first year, she says. There will be opportunity to earn better commission the more they sell, she adds.
For current partners, Crexendo offers a partner portal to access training, marketing tools, press release and email templates, customizable brochures, a customizable product pricing tool, and product presentations. “We also made them a little line of code to add a dynamic piece to their website. It pulls content we host to their website so it looks and feels like their website, and we update it for them regularly.”
Once the tiered program is in place, partners will also have an opportunity to receive market development funds. Today that is done on a case-by-case basis, she says.
This quarter Crexendo will be making a mobile sales enablement app available to partners through a partnership with LiveLink LLC. “Ehren Maedge [LiveLink VP of sales and marketing] has been very gracious letting us be one of his beta sites.” In addition to accessing documents and email from their smartphones, partners will be able to register deals, she says, and Crexendo will be able to highlight Spiffs and customer-facing promos. “I think it will be a good interaction tool with partners.”
Anderson has spent time her first year going to industry trade shows and events and traveling to meet partners and “gain mindshare and market share. We’ve had some great success. Our revenues increased tenfold via channel partners in one year.”