SAP launched a global initiative to provide marketing and business development assistance to new and current channel partners that are committed to rapidly expanding their cloud services to small and midsize customers.
Under the Cloud Accelerator effort, which has been operating on a limited trial basis for several years and is now going global, SAP will provide the aid to partners who commit to annually grow their SMB cloud business by at least 50 percent.
"It's proven to be super successful and now, this year, we're going to go worldwide. It's a proven model," said Karl Fahrbach, head of global channels within SAP's general business and global channels operations, in an interview with CRN.
SAP, Walldorf, Germany, has been transforming itself to focus on its cloud software services in recent years. And the channel has been a part of that. While the vendor's cloud sales through the channel and direct sales grew at about the same rate in 2015 and 2016, Fahrbach said, cloud sales through the channel grew at a faster pace last year.
In the past one and a half years SAP has recruited 580 new "cloud-only" new partners – a fact that Fahrbach said was the result of the vendor's "partner-first" approach to cloud sales.
About 75 partners participated in the early Cloud Accelerator initiative and the channel executive said partners that participated in the program generally doubled their cloud sales pipeline.
SAP plans to triple its investment in the Cloud Accelerator program this year and enlist three times as many solution providers, according to Fahrbach. While some of those will be solution providers newly recruited to SAP, he expects the majority to be current SAP partners who want to expand their cloud business.
The core of the program, including training and workshops for partner sales and marketing executives, provides assistance in developing a digital marketing strategy and marketing campaigns – often one of the biggest challenges for solution providers making the transition to cloud computing, according to Fahrbach.
That includes helping solution providers make the shift from a project-based revenue model to a recurring revenue model, a financial transition that can trip up channel businesses, and achieve profitability more quickly, he said.
Projexia, a Montreal-based solution provider and SAP Gold partner, was an early participant in the program as the company has shifted over the past five years from selling on-premises software to selling cloud services.
"It helped us tremendously," said Projexia President and CEO Sylvia Bologna in an interview with CRN. The program provided funding and expertise in "making the shift in how we approach marketing and how we market cloud," she said.
While Projexia's on-premises software sales exceeded cloud-based sales as recently as 2014, the company's cloud revenue was five times on-premises in 2017, Bologna said.
The program also helped guide Projexia through the cash flow shift from project-based revenue to recurring revenue. "The model is completely different," Bologna said.
Customers today are looking to buy more integrated packages of cloud software and services, which can provide a faster time-to-value, rather than one-off applications, she said. So now she's looking to the Cloud Accelerator program to help her company develop more packaged cloud solutions. "That's what I'm expecting for the next step," she said.
SAP channel and regional managers will be identifying solution providers who meet the program's criteria and have the most potential to gain from the initiative, Fahrbach said.
The channel executive said funding and other resources for the Cloud Accelerator effort represent additional funding for SAP's channel operations and are not being taken from other channel programs.