Cisco Value Incentive Program (VIP) 20: More Partner Profits?
Cisco Systems‘ Value Incentive Program (VIP), one of the networking giant’s most popular ways to reward partners, has entered its 20th edition. Updated every six months, VIP inspires partners to sell specific Cisco (NASDAQ: CSCO) products. Hit or exceed Cisco’s sales targets, and VIP partners earn special back-end profit margins. VIP 20 also provides clues about Cisco’s own sales priorities for the next two quarters. Here’s the background.
Ricardo Moreno, senior director of strategy, planning & programs for worldwide channels, described VIP 20 in a blog post. However, he didn’t publicly say which products Cisco will emphasize. (Any chance you’d like to leak the deeper details to The VAR Guy, Mr. Moreno?)
Cisco Channel Evolution
VIP 20 arrives (on schedule) amid multiple channel and business changes at Cisco. Indeed…
- Bruce Klein recently succeeded Keith Goodwin as senior vice president, Worldwide Partner Organization. (Goodwin retired and recently offered The VAR Guy these exit thoughts.)
- Wendy Bahr recently succeeded Jim Sherriff to lead the Americas channel organization.
- Cisco recently confirmed plans to cut 2 percent of the company workforce.
And what about VIP 20? Moreno’s blog did offer three intriguing pieces of information. He said Cisco is:
- “Integrating Express as a track in the VIP 20 program. This will make it even easier for our SMB and Commercial segment focused partners to take advantage of Cisco’s flagship profitability program.
- As in prior VIP periods, the Product SKU lists are updated to ensure we are rewarding partners for selling the most current solutions – please see the VIP Playbook for more details.
- Plus, we have fine-tuned the rules around program enrollment, payment cycles, and order processing.”
Hmmm… Cisco’s continued investments in the VIP program are super-important. During major Cisco layoffs last year, some partners worried Cisco would abandon the program. But VIP 18 and 19 marched forward. And now comes VIP 20.
Some channel companies are starting to emulate portions of the VIP approach. For instance, the Juniper Partner Advantage program now offers back-end rewards to partners, note Juniper Senior VP Frank Vitagliano. Also, McAfee’s Security Connected Strategy includes a Total Access promotion, which could deliver 30 percent margins to some mid-market security partners.
Back at Cisco, can VIP 20 deliver the back-end profit margins that partners crave? The VAR Guy is listening closely for more clues.