NA Channel Program & Strategy · • Program focuses on value and not over-distribution of the market • Focused on self sufficiency and enablement • Financial levers to generate

Distribution Partners

March 2013

NA Channel Program & Strategy

Tim Egan

Proprietary and Confidential

Channel Program - Agenda

• Channel Goals and Objective

• Ceragon NA – Go To Market (GTM) and Coverage Model

• Channel Program Overview:

• Program Framework

• Benefits:

• Sales & Marketing Incentives

• Technical Incentives

• Financial Incentives

• Program Tiering

• Program Differentiation

• Launch strategy and phases

• Backup

• Opportunity Registration Process

• Certification/Competency

• Technical Support and Entitlements

• MDF and Marketing


Channel Goals and Objective

• Enhance coverage by geography & vertical market segments

• Enlist and invest in small number of partners that add “value” in the

marketplace

• Not interested in “brokers” but partners with a services practice

• Partner coverage model that includes (Recruit, Retain, Retire)

• Significantly increase consideration rates for Ceragon solutions

• Grow profitably while maintaining strong gross margins for our

partners

• 15 to 20% GM for distribution channel

• Invest in partner enablement and self sufficiency

• Target and incent new business and creating demand

• Ensure we deliver Customer/Partner satisfaction through the

channel

• Recognized as premier channel program in microwave industry that

enables – Predictability, Trust and Profitability to our Partners


Ceragon NA – GTM and Coverage Model

4

Direct Accounts

(Carriers/SP)

Vertical Mkts

Public Safety Utilities

Oil & Gas

Geographical

Hig

h T

ouch

- V

alue

Low

- T

ransa

ctio

nal

C

HA

NN

EL

DI R

E C T

Dir

ect

Rel

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ip w

ith M

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r


Channel Program Framework

5

Benefits Financial Technical Sales & Marketing

Certification

Tiering

Sales Technical Installation

Ecosystem

VAR Valued Added

Reseller

SI Systems

Integrator

Services

Only

SMEU Self

Maintained

End User

Distributor

Distributor

VAR

Premier VAR (PVAR)

SMEU


Sales and Marketing Benefits

6

Benefits Details

Channel Account Director Designated Channel Account Manager to help drive Partners GTM strategy through the development of a business plan.

Sales Engagement Principals GTM commitment and sale engagement principals to protect partners sales opportunities and margins. Facilitated through Opportunity Registration Process.

Lead generation programs Formal lead generation programs provided by Ceragon and our distribution partners. Co-op marketing funds for targeted events, campaigns, etc.

Vertical Market incentive Marketing incentives targeted at strategic vertical markets

Partner Portal Marketing resources including collateral, sales tools, etc. PVAR positioned on Ceragon web page

Press release and case studies Joint reference and co-branded case studies.

Sales Training Sales training and certifications on Ceragon portfolio and solutions.


Technical Benefits

Benefits Details

Pre-sales support directly with Ceragon

Designated Presales resources only available to PVARS

Technical Tools Configuration and design tools to speed up development and quality of BOM

Technical Certification Program (CCSA)

Certification training to enable and authorize VAR’s to implement and manage Ceragon product. Delivered by Ceragon and through distribution partners

Product Management access Access to global product management for technical support and product development feedback

Technical Support Technical support on-line to VAR and Distributors via Partner Portal

Maintenance Services and SLA Offerings

Wholesale services portfolio from manufacturer to augment VAR solutions for maintenance and implementation services.

7


VAR Financial Benefits

Incentive Details Value

Incremental Discount

• Developed to reward partners who are investing in the development of a Ceragon Practice. This incremental discount provides greater margin flexibility and competitive advantages to our top partners

Incremental Discount on List Price.

Opportunity Registration

• Opportunity Registration Program to reward new sales and new customer acquisition • Protects VAR investment in creating new opportunities • Sales support from Ceragon direct and channel sales and technical teams • Initiated and managed through distribution

• 3% rebate. • Paid off POS as a

% of list price

Market Development Funds

• Discretionary funding based on business case to generate mutual business growth • Jointly funded with Partner (50%/50%)

Discretionary based on business case

Vertical Market Promotions

• Developed to reward partners who sell into targeted strategic verticals offered via additional discounts .

Additional discount off List Price.

Demo Purchase Program Demo Purchase program offers low cost demo equipment Try it or Buy It

8


Distribution Financial Benefits

Incentive Details Value


• Opportunity Registration Program to reward new sales and new customer acquisition • Protects VAR and distributors investment in creating new opportunities • Incents VAR’s to provide funnel visibility for better forecasting • Sales support from Ceragon direct and channel sales and technical teams • Initiated and managed through distribution

• 3% rebate. • Paid off POS as a

% of list price • Split between

Ceragon and Distributor (1.5% each)

Market Development Funds

• Discretionary funding based on business case to generate mutual business growth • Jointly funded with Distributor (50%/50%) and 100% reimbursed through a claims process. • Use it or lose it financial bucket

2% of Revenue based on annual performance

Volume Rebate Program • Incremental discount based on revenue performance and

volume. • Minimum revenue requirement

1% Quarterly Rebate

Vertical Market Promotions

• Developed to reward partners who sell into targeted strategic verticals offered via additional discounts .

Additional discount off List Price.

Demo Purchase Program Demo Purchase program offers low cost demo equipment Try it or Buy it

9


Channel Program – VAR Requirements

Tier Requirement Annual Measure:

Premier VAR (PVAR)

Revenue (Product/Services)

$350,000

Certifications/Competency: Certified Sales Resources Certified Pre-Sales Resource Technical Certification (CCSA)

2 1 2

Business Plan with quarterly review Annual

VAR


$50,000


1 1 1

1

0


Channel Requirements – Self Maintained End User

1

1

Type Requirement Annual Measure:

Self Maintained End User (SMEU)


$250,000

Certifications/Competency: Technical Certification (CCSA)

2

SMEU questionnaire and approval process based on specific requirements to ensure SMEU is self sufficient.

Need approval

annually


Channel Program – Distribution Requirements

Type Requirement Annual Measure:

Distributors


$4,000,000


5 2 2

Business Plan with quarterly review

Annual

1

2


Program Tiering – How Determined?

• Partner levels are determined at the beginning of each calendar

year coinciding with Ceragon’s Fiscal Year – January to

December

• Partners will be “grandfathered” into program based on current

distinction once new program is launched.

• Partner levels will be effective for a period of one (1) year

• Partners can “move up” a level once higher level criteria is met

during Fiscal Year

Minimal Partner Requirements

1. Minimum volume/revenue performance

2. Adhere to Sales Engagement Principles

3. Positively represent Ceragon brand with customers


Channel Program Benefits – VAR by Tier

Benefits VAR PVAR Availability

Sales and Marketing

Channel Account Director No Yes Today

Sales Engagement Principals Yes Yes Launch

Lead generation programs No Yes 2013

Partner Portal Yes Yes 2013

Press release and case studies No Yes Today

Technical

Pre-sales support directly with Ceragon No Yes Today

Configuration Tools Yes Yes 2013

Technical Certification Program (CCSA) Yes Yes Today

Product Management access No Yes Today

Incentives

Incremental Discount No Yes Today

Opportunity Registration Yes Yes Launch

Market Development Funds No Yes Launch

Demo Purchase Program Yes Yes Launch

Vertical Market Promotions/Discounts Yes Yes 2013


Channel Program Benefits – SMEU & Distributor

Benefits SMEU Distributor Availability

Sales and Marketing

Channel Account Director No Yes Today

Sales Engagement Principals Yes Yes Launch

Lead generation programs No Yes 2013

Partner Portal Yes Yes 2013

Press release and case studies No Yes Today

Technical

Pre-sales support directly with Ceragon No Yes Today

Configuration Tools No Yes 2013

Technical Certification Program (CCSA) Yes Yes Today

Product Management access No Yes Today

Incentives

Opportunity Registration No Yes Today

Market Development Funds No Yes Launch

Volume Rebate Program No Yes Launch

Vertical Market Promotions Yes Yes Launch

Demo Purchase Program Yes Yes 2013


Program Differentiation

16

• Ceragon long history of high quality, innovative and reliable

products

• Industry leading gross margins in the channel

• Program focuses on value and not over-distribution of the

market

• Focused on self sufficiency and enablement

• Financial levers to generate demand and incent investment in

Ceragon portfolio

• Formal business planning with top partners annually.


Launch Strategy & Phases

• Phase 1 – Partner Launch (March 1, 2013)

• Launch and announce Program and Framework

• Introduce programmatic we can deliver TODAY:

• Communicate initial program tiers and partner segmentation

• Supported by promotions to drive initial demand

• Phase 2 – Mid year program enhancement (July 2013)

• Operationalize program and enhance based on feedback

• “We reserve the right to get smarter.”

• Formalize and enhance certification program

• Introduce new tools and enhancements

• Phase 3 – January 2014

• Partner tiering based on full year program.

• Additional enhancements including more self sufficiency and tools

• Co-delivery options for support and managed services

1

7

BACKUP

18



Ceragon – Opportunity Registration Flow Chart

2

0

VAR

• Identify opportunity

• Submit to distributor

• Continue to support customer opportunity

• Update monthly

Distributor

• Load registration into Salesforce Portal

• Update monthly

• Forecast and position inventory

Ceragon

• Validate and approve registration

• Review monthly updates

• Issue credit to distributor and discount to VAR


Opportunity Registration Benefit and Requirements

BENEFITS OF OPPORTUNITY REGISTRATION

Incremental 3% discount to be paid via a rebate by the distributor. The discount only applies to IDU’s/ODU’s. Antenna’s and accessories are not eligible

Account control and sales protection for approved opportunities by Ceragon Sales support and engagement from Ceragon Sales Directors and Pre Sales resources locally Reduced channel conflict

RULES OF ENGAGEMENT

In order for an opportunity to qualify it must be a unique, unknown to Ceragon and not currently being pursued by Ceragon authorized reseller (VAR, System Integrator, etc).

Open bid RFP’s and RFI’s are not eligible for Opportunity Registration In order to qualify for the discount incentive the opportunity must be greater than $50,000 in Ceragon

Product Costs (approximately 5 Links). If less than minimum threshold all other benefits still apply. As qualified reseller identifies projects, they notify their distributor of choice using the registration

process and distributors are responsible to manage the interface with Ceragon. Ceragon qualifies opportunity to ensure the deal is not currently registered or known and will provide

written approval and a registration number. Registration must be updated monthly to distributor to maintain registration status. Distributor must forecast and position orders to ensure having proper inventory when deal is purchased. Margin incentive will be paid in arrears when product is shipped to customer via a distribution rebate. Opportunity registration is valid for 90 days from date of approval.

2

1


Opportunity Registration Form - Salesforce

2

2

Marketing


Lead Generation Programs

Program

Process

Delivery

Availability

Website Leads Ceragon Web Portal Email to Partner Now

Trade Show Support Work with Distributor to identify strategy tradeshows focused on verticals GTM Strategy

Participate and fund tradeshows jointly

Now

VAR specific demand generation programs

Develop specific marketing plan supported by business case

As per business plan Now

Vertical market campaign

Case study driven Email to end user customers and issue to publications

Now

2

4


MDF – Eligible marketing deliverables

• Marketing materials CD's and Brochures

• Co-branded Marketing call-out programs

• Co-Branded Webinars to verticals or end users

• Regional/local trade show reimbursement

• Certificates for course completion

• Wall Plaques for PVAR status

• Co-branded mailers

• Portal Access (need to determine what is on here)

• Banners, display kits, other collateral

• Lead dissemination from direct Ceragon Marketing events

Certification and Competency


Certification Program

Competency

Program

Delivery

Costs

Availability

Status

Sales Certification

1 Course – exam On-Line Free Q1 2013 To Develop

Pre-Sales Certification

2 Courses - Technical training - Configuration Tool

On-Line Virtual or On-site

Free

Free

Q1 2013

Q4 2012

To Develop To Develop

Technical Certification (CCSA)

2.5 day course - Exam - IP10G and RFU - Advance feature and

functionality including NMS. (1)

Instructor lead at partner location

$5,000

Now Update content to include new products, and additional ½ day elements

2

7

Technical Support and Maintenance


Channel Technical Support – Offerings & Entitlements

Product Warranty Maintenance Offerings

Warranty

Extended Warranty

Advanced Replacement

Prime Package

Prime + Extend Svc

Help Desk 8x5 8x5 NA 8x5 24x7

CRM/Web Portal NO NO NA Yes Yes

Remote Diagnostics

8x5 8x5 NA Yes Yes

HW Repair Yes Yes Yes Yes Yes

Advanced Replacement

No No Yes No Yes

* Excluding Discontinued Product

SW Repair/Fixes Yes Yes NA Yes Yes

SLA Best Effort Best Effort 24 Hours Yes Yes

Term 1 Year 1 – 5 years options 1 – 5 years options 1 – 5 year options 1 – 5 year options

Fee Included in price

of product 3.5% of sale price/year

3.5% of sale price/year

Priced by component with tiered discounts

Priced by component with tiered discounts

Availability Available Discontinued

March 31, 2013 Discontinued

March 31, 2013 January 1, 2013 January 1, 2013

Documents

NA Channel Program & Strategy · • Program focuses on value and not over-distribution of the market • Focused on self sufficiency and enablement • Financial levers to generate