All systems go

Having supposedly seen the market reach its nadir last year, PC vendors in the Middle East are feeling bullish about their prospects again as they set about implementing their 2010 channel strategies.

Tags: Acer Computer Middle EastHewlett-Packard CompanyLaptopsLenovo GroupToshiba CorporationUnited Arab Emirates
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By  Andrew Seymour Published  January 17, 2010 Channel Middle East Logo

The PC industry encountered its toughest ever year in 2009, but manufacturers are now picking themselves up off the floor, dusting themselves down and devising game plans to ensure what they hope is a swift return to better times.

Worldwide PC sales recently showed a growth of 2.3% after three consecutive quarters of decline, according to IDC, and while the Middle East and Africa had generally been exceeding the global average anyway, signs of a global pick-up will no doubt be well-received.

How successful vendors will be at transferring this positive performance into something more significant will be heavily influenced by their ability to engage with their channels in the region.

Irrespective of economic factors, vendors need to continue investing in and developing their sales channels to ensure they have the right coverage to address the opportunities that present themselves in the market.

Many PC manufacturers already lay claim to established partner networks in the Middle East and Africa so their plans for 2010 tend to revolve around empowering these channels even further. For Fujitsu Technology Solutions, the priority is to invest in channel training and education, explains product manager Chandan Mehta (main picture).  

“We have already kicked off workshops with partners across the region and feedback from this will be incorporated into our plans for 2010,” explains Mehta. “We intend to fully equip and support our partners to win more customers in both lines of our business — enterprise infrastructure solutions and consumer products.”

Toshiba, a pure notebook vendor, is pinning its hopes on formulating sales programmes that inspire its existing channel partners in the Middle East to reach new heights. 

Regional manager Santosh Varghese says the company has presided over a “stronger and tighter” partner network during the past 12 months, and it is keen to fortify that situation this year.

“For FY2010, we will consolidate our channel programmes, which currently offer only target-based rebates,” reveals Varghese. “We are launching a new programme which will include sales staff training and certification, in-store branding, POS support, co-promotions and demo discounts on Toshiba differentiated products in addition to target- based rebates. We will also be increasing the offer of service franchise and pick-up and drop-off points for consumers.”

Taiwanese PC vendor Acer is not planning any major alterations to its main channel programme at the moment, although it has not ruled out making some slight adjustments if it proves necessary. Like Toshiba, it intends to place a firm emphasis on conceiving sales incentive schemes that drive sell-out behaviour in the Middle East channel.

Aman Khan, marketing and communications manager at Acer Middle East, explains: “We are going to implement certain incentive structures on a quarterly basis. These will be over and above the yearly programme that we have, and this is primarily to boost the sales throughout the period. On top of that we also have the seasonal programmes — initiatives that we run during the Dubai Shopping Festival (DSF), for example, to help sales and help the channel.”

For other vendors, such as Lenovo, giving partners a platform for communication and support sits top of the agenda. Djillali Lahiani, regional channel partner manager for the Middle East, Egypt and Pakistan at Lenovo, says “productivity and profitability” is its mantra for channel growth this year. “We have a methodology which is named RAD — retention, acquisition and development,” says Lahiani. “As we are in the emerging markets, we continue implementing these strategic tools for us to segment the right partners in the right places and the right areas.”

He says this segmentation has become critical to the company’s plans, particularly with the launch of new IdeaPads through the retail channel to come.

“To meet the specific needs and demands of different segments, our main strategy is to work through selected partners,” adds Lahiani. “We will be developing the partners that know our products, are loyal to us and believe in our products — many of them understand the business from the IBM legacy.”

While PC vendors face pressure to make their quarterly numbers and generate the volumes to push them higher up the rankings, few can afford to ignore the topic of partner profitability in the current environment. Some manufacturers say they are looking to lift price points this year to drive additional channel margin, while others believe partner profitability comes from careful partner-territory management.

HP insists it has worked hard to keep on top of the profitability issue by attempting to simplify the programmes it operates and the number of product SKUs it offers, while also endeavouring to drive value specialisation.

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