Technology Distributors, Channel Incentives, and Gray Markets (Slides)

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Technology

Distributors,

Channel Incentives,

and Gray Markets

Courtesy of the

Small Business Computer Consulting Blog

http://blog.sphomerun.com Creative Commons Image Source: Flickr Nick Saltmarsh

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A Recent Report

From a Survey

Made Jointly by

Deloitte & Touche

LLP

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And the AGMA

(Alliance for Gray

Market and

Counterfeit

Abatement)

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Links Channel

Incentive Abuse

With the High-tech

Gray Market

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Gray Marketing is

the Unauthorized

Commercialization

of Products that

Have Been Diverted

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From Authorized

Technology

Distributors

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“Depending on the

Volumes Involved,

Even Price

Differentials of

$0.50

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Can Be Sufficient

to Stimulate Gray

Market Product

Flows.”

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Gray Marketing

Damage to the

Distribution

Channel

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Technology

Distributors and

Resellers

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Can Account for

More Than 75% of

the Revenue of

Technology

Companies

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Gray Marketing

Caused by Incentive

Abuse Ultimately

Weakens the

Distribution Channel

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With Problems in:

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• Customer

Satisfaction

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• Warranty

Administration

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• and Brand Image

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Lack of Adequate

Channel Monitoring

& Control, and Poor

Channel Partner

Communications

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Also Contribute to

the Overall Incentive

Abuse Problem

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A Complicating

Factor is the

Combination of

Incentives

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• End User Pricing

Discounts

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• Program Pricing

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• Channel Partner

Accreditation

Level Incentives

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Better Vendor &

Channel

Collaboration and

Monitoring

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Strong Management

Programs for

Channel Incentives

Should Be Good for

Vendors,

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Authorized

Technology

Distributors, and

Channel Partners

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With Control and

Profits Working in

Synergy, Rather

Than in Conflict

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Have You

Experienced

Competition From

Gray Marketers?

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What Do Your

Customers Think

of Gray

Marketing?

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Let Us Know What

You Have Seen in

the Comments

Section

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Creative Commons Image Source: Flickr Nick Saltmarsh

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