|Next shifts dealer strategy|
by Eric J. Adams
Redwood City, CA: Based on discouraging retail sales figures, NeXT has quietly shifted its dealer strategy away from retail storefronts to "value-added dealers" sellers who can handle longer and more complex sales cycles.
"I think the early expectation of all parties that these things would walk off the shelves in 30 to 60 days was overly optimistic," said Erna Arnesen, NeXT's director of channel sales. "What we realized is that 90 days later, [dealers] are just starting to close sales."
Consequently, NeXT has redirected its support efforts away from grand openings and retail-marketing activities and toward direct sales support, such as training, vertical seminars, assistance with technical integration and proposals, and direct NeXT involvement around key bids, said Arnesen.
Most NeXT dealers generally support the new strategy, saying it will help get NeXT machines into the hands of large customers. "NeXT is the kind of product that needs a one-on-one introduction, the same way Apple did eight or nine years ago," said Richard Silver, president of Cambridge Electronics, in Cambridge, Massachusetts. "[NeXT's strategy] may not be the fastest way, but I think it's the surest way to get the machines in the hands of the right people."
But other retailers believe the strategy will hurt NeXT in the long run, and that NeXT will invariably have to master the traditional retail channel to meet with success. "If NeXT is going to hit the numbers that they want, they're going to need the dealer channel there, and they need to understand the mind-set of reps bombarded by contests by Apple and DOS vendors," said a former NeXT dealer who asked not to be identified.
The shift has NeXT looking for a different breed of dealer. "We want people who are willing to make a strategic investment, who understand the demands of longer sales cycles and are willing to dedicate themselves to high-end selling," said Arnesen. In practice, the strategy shift translates into dealers who are familiar with outbound selling, focused on key markets, or specializing in networking, connectivity, or multivendor workstations and environments, and possibly UNIX literate, said Arnesen.
And even though storefronts are no longer considered a critical component of NeXT's dealer strategy, Arnesen said NeXT will continue to support current storefront dealers and woo dealers who can dedicate at least part of their organization to NeXT's new philosophy.
"The shift isn't so much a de-emphasis of the dealer but the way we support the dealer channel," said Arnesen.
NeXT distribution through the years
October 1988: NeXT says it will focus on the higher-education market with direct sales force
March 1989: NeXT announces exclusive deal with Businessland for push into business market
July 1989: Canon becomes exclusive distributor of NeXT in Asian market
May 1991: NeXT/Businessland deal dies; NeXT signs on other storefront dealers
Late 1991: NeXT shifts focus from retail store-fronts to value-added dealers