Asus Channel Tree

One of the leading players in the
motherboard segment in the country, Asus is also revitalizing its
notebook presence in order to address the personal computing space in
India. Driven by innovation and committed to quality, ASUS designs
and manufactures products that perfectly fit in the pursuit of
meeting the needs of today's digital home, office and individual,
with a broad portfolio that includes motherboards, graphics cards,
displays, desktop PCs, notebooks, netbooks, servers, multimedia,
wireless solutions, networking devices and mobile phones. Off-late,
the vendor is widely credited with revolutionizing the PC industry with
the 'Eee PC'. Recently, the company restructured its ASUS System
Business to incorporate the recent
growth in Indian economy and hence has appointed new regional channel
managers to ensure best growth
trajectory in the notebook and netbook market. Acting on its
philosophy and promise of inspiring innovation and persistent
perfection, Asus has created a comprehensive response to this
development to safeguard the best interest of ASUS customers around
the world. “This ensures that ASUS develops the best quality
technology like SonicMaster or service like on-site warranty to help
consumers
choose the best possible products that suit their requirements.

The same conviction helped ASUS to win
3,398 awards globally in 2010 among which many reputed awards were in
design and innovation categories,” Said Alex Huang, Country
Head-System Business, ASUS (India). “We will provide total
warranty services to maximize computing and usability, as each ASUS
product is delivered with an uncompromising quality pledge with the
dedicated global employee base of more than ten thousand people,”
Huang added.

THE CHANNEL STRUCTURE

Discussing the channel structure of the
company, Huang said, “We have tied-up with three national level
distributors for the system business sales, which include, Rashi
Peripherals, Ingram Micro and Netplace Technologies who subsequently
sell our notebooks and netbooks to sub-distributors and end-consumers
alike. We are also planning to open our ASUS exclusive showroom in
major metros and we are currently in talks with regional oriented
partners to set up dedicated areas for us to showcase our products in
their showrooms.” ASUS is also in talks with some regional level
distributors to help us to ensure that our products reach even tier-2
and tier-3 cities of India apart from the tier-1 cities. Asus India's
channel structure is quite simple spread across three tiers. The
three national distributors can do direct billing solely from the
company. Currently, there are four regional distributors in Gujarat,
Delhi, Kerala and Assam. “We are also planning to sign up with
three more regional distributors in Orissa, Chennai and Kolkata. This
is because the distributors contribute to about 30 percent in our
business growth in India,” Huang said. Globally, ASUS has two R&D
centers in China and Taiwan.

According to Huang, with the right
partners onboard the vendor is certain to improve its presence and
penetrate the market further.
Currently, there are about 2000 channel partners for Asus in India.
Asus India has two sets of partners; one addresses the consumer
segment and the other caters to the commercial one. “We have almost 250
dedicated channel partners for system business and plan to increase our
count to almost 500
partners. If we take into account the number of partners that promote
both of ours system and component
product portfolio, then the number will be much larger at 2000. We
will also be hiring as many as 60 regional channel managers to help
streamline the communication channel,” said Huang. Even though 90
percent of the laptop business comes from consumer segment, Huang is
expecting the revenues from its commercial segment to increase this
year. Through the channel partners, the vendor focuses on the SMB
segment which contributes a larger chunk to its annual revenue. SMBs
are considered to be the growth driver for Asus' business in India.




Today, small and medium sized businesses have
unprecedented access to new markets, suppliers and customers; it is
truly a global marketplace today. “We are constantly looking at
shaping industry conditions and understanding holistic
solutions that our customers seek in order to help them pursue a
quantum leap in value to dominate the
market,” said Huang. Channel partners have been the main backbone
of the ASUS growth strategy in India and they are one of the primary
factors for their excellent growth record of more than 33 percent on
a YoY basis in 2009-10.

STRATEGIES

Replicating the global record growth of
almost 114 percent in global PC shipments, Asus India is not only
actively increasing its channel base but also providing special
meets with training seminars to help them understand the benefits of
ASUS products for them. Huang explained that having a well-mapped
channel strategy is the best way to increase its market penetration.
Since the Indian channel network is still in process of
consolidation, there is a vast untapped potential in the Indian IT
market and thus, the company is eager to increase its channel base to
reach out to maximum number of consumers through the channel
partners. 

Highlighting the vendors commitment to
its channel initiatives and its significance, Huang explained that
the channel meets and seminars do help in the process but they are
usually sporadic and offer only one form of interaction. With the
launch of partners meet and training programs, partners can reach
ASUS directly, one to one and face to face from the comfort of their
own offices. According to the vendor, the frequently conducted
training program will help partners to face issues with product
updates, service issues and availability related queries and with the
launch of this initiative, ASUS is keen to address these needs of
partners. Partners can now get real-time updates on any issue,
clarify their service related queries and touch base with the ASUS
product team for update.

Elaborating upon his strategies, Huang
said, “We have started many programs and initiatives like the ASUS Gold
Partners Program, that
ensures more benefit and special discounts to the partners who, have
signed up for the initiative on
the condition that they promote more of ASUS product portfolio. We are
also rapidly increasing our
service network and launched the ASUS on site service warranty in 54
major Indian cities in 2010 and have
been getting some very encouraging feedback from consumers and partners
alike”, Huang
elaborated. Asus Gold Partner (AGP) program is spread across cities
in India and is going to be leveraged to generate awareness and
improve its market presence. According to the company, the ASUS AGP
initiative fortifies the relationship with channel partners by
helping them derive maximum benefits. This special program allows
resellers to increase their exposure thereby gaining a competitive
advantage and also increases their focus on end-user sell-out of ASUS
system products. Once enrolled in this unique program, channel
partners become eligible to buy 'exclusive AGP models' from ASUS
distributors apart from general channel models, besides availing demo
discounts and assurance of higher upfront margins.

As a part of the ASUS Gold Partner
program, AGP's will be eligible to buy 'exclusive AGP models'
from ASUS distributors apart from general channel models. As such
they can avail higher margins compared to standard market prices and
end-user price will not be affected. ASUS invests in their marketing
activities to ensure brand building and the AGP's can also obtain
full rebates on their 'Inhouse branding' expenses for ASUS' system
products. Based on the performance of the channel partners on the
targets specified, they will be eligible to qualify for the next
level, viz: ASUS Platinum Partner or ASUS Diamond Partner programs.
One of the most important parts of this program will be the focus on
'ASUS Champion', where ASUS will fund a partner, based upon
completion of a specific target, which is also defined as per
the city strength.

“We also believe in investing heavily
in developing the necessary technology and services to ensure that
our notebooks and netbooks remain the most trusted and least prone to
fail products. Our products go through stringent quality tests to
ensure their durability is not compromised with regular wear and tear
activities of consumers. Our belief is that we should keep on
investing in high-end technology and services and ensure excellent
after-sales service. This will benefits the channel admiration and
trust in India as found globally,” said Huang. ASUS believes in
developing strategies, based on feedback and inputs from people, and
work towards the same. ASUS is also launching unique and
technologically advanced products in the next twelve months thereby
ensuring that there are ample value-for-money products in all segments.