Working through our wonderful Distribution Partners (Tech Data, Ingram, Synnex, and D&H), I’m often asked, “Should I sell my customer Office 365 via Open or CSP?”
If you were at Microsoft’s Worldwide Partner Conference in Orlando this past July, the answer would “clearly” be through the CSP (Cloud Solution Provider) program. It was the “buzz word” of the event.
I would tend to agree, that in many instances, CSP is probably going to be the preferred method of selling Office 365 to your customers. Our Distribution Partners have been working diligently to provide best-in-class cloud provisioning portals to help enable the CSP selling process. These portals allow you to create packaged SOLUTIONS to deliver to your customers on a recurring basis.
With CSP, you can:
- Set the price, the terms and directly bill customers
- Directly provision and manage subscriptions
- Be the first point of contact for customer support
This means you can decide to bill your customer every month, every two months, up front, after 6 months, etc. It is really up to you. Of course you will be responsible for paying your distributor every month, but you get to decide on the terms for your customers.
The ability to directly provision and manage subscriptions has also been something partners have been looking for. Being able to scale the number of seats/users directly for your customers is quite easy through your distributor.
And finally, you control the support needs of your Office 365 customers. Combining your MSP capabilities with that of Microsoft and your preferred distribution partner, you get to manage that support lifecycle.
With CSP, you can create SOLUTIONS that you can bundle up with other third party components and truly offer that “one” bill that includes products and services.
This all sounds great, so why would a partner ever sell Office 365 through the Open program?
Many partners I’ve talked to tell me that when they are working with a customer who is just looking to acquire Office 365 and/or has their own IT staff that Open is actually the preferred model.
In the Open model, each license is valid for one year’s worth of Office 365, and this is paid up front. The partner receives all of their top line revenue as soon as the license is sold, and does not have to worry about collecting monthly. However, they still get to enjoy the recurring revenue model as the renewal comes up annually.
Licenses sold through the Open model also include Tier 1/2 support where the customer can reach out directly to the Microsoft. This works well for many of your “hands off” customers. If they have issues that do not require much Partner help, you are freed from many of the mundane issues that end-users run into.
With the Open model, they do have the ability to bundle services/hardware up front and charge whatever they would like for that package, but charging for ongoing monthly services don’t fit this model as well as CSP does.
There are a myriad of other reasons that you might be able to think of to sell either CSP or Open, so please leave some of your ideas in the comments below.
If you want to see other parts of the series take a look here: http://office365.msts2.com