German thin-client maker IGEL targets North American market through all-channel strategy

IGEL has been in North America for a while, but the company is now investing considerably more in its key partners and its channel program, to develop a core of elite partners to drive market share growth. They are at Citrix Synergy this week discussing future plans with their partners, who also typically sell Citrix.

Jed Ayres IGEL 300

Jed Ayres, President and CEO of IGEL North America

LAS VEGAS — Bremen, Germany-based IGEL is not a well-known name today in the thin client space in North America. The company ranks seventh in North American shipments, according to IDC, far behind market leaders Dell and HP. They have a realistic strategy to take enough share to get to third behind the two giants however. It is based on better leveraging their channel in North America, investing more in their core partners and their partner program, and differentiating their software that they believe is their primary competitive advantage.

“My task is to raise our profile in North America,” said Jed Ayres, who has just been appointed as President and CEO of IGEL North America. “Today we are number seven in North America, but there is a gap of only 24,000 units to the number three spot, which is far behind Dell and HP. None of the companies between us and the market leaders have a channel program to speak of. We really see that as our opportunity, to build a modern channel program that effectively enables partners to sell our products.”

Ayres said that IGEL differentiates itself by the quality of their solution.

“We are the most expensive solution in the market and we are taking market share,” he said. “The price of the gear isn’t the ultimate deciding factor. We are comfortable there because of the software’s value proposition. When people see the power of the software, and realize this is not commodity hardware, the light goes on. I was hired specifically to elevate that differentiator, which is our workspace management software that comes bundled with all the hardware.”

Ayres said that German reputation for quality product doesn’t hurt them either.

“Everything is assembled and engineered in Germany, although the plan is to move a manufacturing facility into the U.S. as part of our expansion here,” he indicated.

The customer base is all over the map, including a franchise of convenience stores and a group of dialysis centres with 25 locations.

“The real growth, though, is in the enterprise,” Ayres said. “We have a big deal in the banking industry for 20,000 units, our biggest software deal ever.”

Ayres came to IGEL from AppSense, following the announcement of its acquisition by LANDesk, but he had earlier spent over 20 years working on the solution provider side, much of it with large Citrix-focused solution provider MTM Technologies. He is at Citrix Synergy this week to talk with key IGEL partners, who are also Citrix partners as well, to discuss the kinds of changes they want to see in IGEL’s channel program.

IGEL, unlike its competitors in the space, sells completely through channel partners. However, Ayres acknowledged the channel program they have been using in North America badly needs a refresh.

“Today, we have a ‘one size fits all’ program, where you get deal registration and that’s pretty much it,” he said. “The opportunity here is to build out a tiered program with back-end rebates and MDF and additional margin protection for people investing in the company.”

Ayres indicated the plan isn’t to recruit a bunch of new partners.

“We already have the partners we need,” he said. “We need to pick the right ones and double down on them. That’s why I’m meeting with them here at Synergy. We are working on how to shape the next generation of the program to accelerate partner growth, with what is essentially an informal partner council. We have been getting good feedback.”

Ayres said that are looking at about a dozen Platinum partners, who they will invest in ahead of revenue.

For more transactional partners, they will leverage distribution, which the company has always used.

“We have a good relationship with both Synnex and Ingram Micro, and are looking to get more leverage from both relationships,” he said. “It’s very clear they can help us scale and provide a lot of value-added services these days.”

Ayres said the value proposition for partners is a good one.

“Partners make 15 per cent plus selling our product, and for hardware today, that’s pretty good,” he said. “Some partners are also doing interesting deals around ‘devices-as-a-service.’ These aren’t MSPs, but traditional partners who have made that pivot. Endpoints-as-a-service are an interesting frontier.”

In Canada, IGEL’s market coverage is not yet well developed.

“We are doing some work, through Ingram, and we have a rep who covers that market, but it’s pretty opportunistic,” Ayres said. “There is some basic organizational structure we need to put in place over the next six months. 2017 is when we would put someone on the ground in Canada and make a bigger effort at an entrée into that market.”

Overall, Ayres said improving IGEL’s marketing message for the North American market has become a top priority.

“We are driving our global marketing message in English first, and then in German, whereas everything in the past has been the other way around,” he said. “Simplifying the message will empower our partners. We have a warehouse in Cincinnati and a small office in New York now, but we will be putting a larger office in San Francisco and will be building a marketing centre of excellence there.

“People in North America will know who IGEL is by this time next year,” Ayres stated.