SMB Partner Incentives. Level 100 Speaker:

(1)

SMB Partner

Incentives

Level 100

Speaker:

(2)

Agenda

• Understanding of the incentives available

to Commercial Distributors in FY15

• Insight into the incentive framework and

the components within the framework

• Guidance regarding the usage of earned

incentives to drive growth

• SMB Channel Incentive Strategy

• The SMB Channel Incentive Framework

• The Business Opportunity

• Incentive Rates & Accelerators

• Coop as a Key Enabling Component

• Alignment with Microsoft Priorities

(3)

(4)

SMB incentives

….

… serve as a catalyst for solid growth worldwide for both commercial & public sector business

… support the various partner communities that most impact the SMB business

… incorporate coop funds to provide an attractive investment opportunity for the BGs and support partner profitability

… combine corporate-defined and locally-chosen elements to provide consistency as well as flexibility

Managed Resellers

Commercial Distribution

FY15 SMB Licensing Incentives Framework

Globally-Applied

Incentive

Components

Locally

Chosen

Accelerators

Selected

At Area Level

(or EU/EFTA)

Cloud Growth

Open

Renewals

Open Renewals

Cloud Open

Reach

Windows

Server

Incent on all Open Revenue

Rebate and Coop Elements

Open VL

Core

Growth

Incubation

Core

Growth

Incubation

Open VL, Office FPP/ ESD

Cloud

Open/ESD

Reach

• Attractive rates for both Growth & Incubation products

• Open Annuity contracts incented at >3X Open L for Growth & Incubation products

• Attractive rates for Cloud products via Open

• Rates increase for both Growth & Incubation products • Open Annuity contracts incented at >3X Open L for

Growth & Incubation products

• Attractive rates for Cloud products via Open

Cash Back

Corporate IT Academy Accelerators

Incremental Incentive for select IT Academy product sales

Solution Workload Accelerator

Incremental Incentive for Certified DISTIs

Incent on SMB Open Revenue (except Cloud Revenue)

Rebate and Coop Elements

GeoX Pilot

Cloud via Open

(5)

FY15 SMB Partner Incentives Focus

Strategy Evolution

Cloud Acceleration

Solutions @ Scale

Reach & Open Renewal Focus

Key FY15 Incentive Highlights

Increase Year-over-Year SMB CI budget

Maintain Global Incentive Framework

Maintain Strong Cloud Incentives

Best Rates for Growth & Incubation in Annuity

Maintain DISTI Solution Accelerator for Cloud

Align Accelerators to Cloud Business Strategy

(6)

(7)

Partner Participation in Commercial

Distribution Incentives

Get More Value

Out Of Your

Microsoft Partner

Network Competency

Use Coop to grow

top-line revenue with

increased demand

creation activities

Broaden partner

Cloud/Solution offerings

into high-growth market

(8)

(9)

Eligibility Requirements for Commercial Distribution

• Have a Distribution agreement with Microsoft

• Channel authorization specifying entitlement to sell finished goods products

• Authorization agreements detailing the licenses for products (Open, FPP, ESD)

it is allowed to sell.

• Earn Microsoft Partner Network requirements as defined for authorization as

a Microsoft Distributor.

• Once a partner has been designated by Microsoft as a Commercial

Distributor, they automatically become eligible to earn incentives as soon as

the program letter is signed by the partner.

Earn Microsoft Partner Network

requirements as defined for

authorization as a Microsoft Distributor.

(10)

Eligible Revenue-DISTI

(

On-Premise)

growth

Incubation

core

• Office

• Office for Mac

• Exchange Server & CAL

• Other MOD

• MOD CAL Suites – Core CAL

• CnE CAL Suites – Core CAL

• Windows Client

• Windows Legalization

• Windows Server Other

• Windows Server Standard

• Windows Server CAL

• Windows Remote Desktop Services

• BizTalk Server

• Developer Tools

• Dynamics CRM

• MOD CAL Suites – ECAL

• MS Learning and IT Pro Subscripts (IT

Academy)

• Project

• SharePoint Server and CAL

• SQL Server Standard and CAL

• SQL Server Premium

• STB CAL Suites – ECAL

• Visio

• Windows Server Datacenter

• Lync Server & CAL

• Lync Plus CAL

• System Center Client

• System Center Server

• Identity and Access

• Windows MDOP

academic

commercial/govt

• Open L or L&SA

• Open Upgrade

• Open SA Renewal

• Open Value - new, renewal

• OVS - new, renewal

• Office 365

• Open Academic

• OVS-ES - new, renewal

• School – new, renewal

Incentives are based on the following

pricing levels and licensing types:

(11)

Cloud via Open Offers

Plans

License Type

Lync Online

Plans 1 & 2

Open, Open Value,

Open Value

Subscription,

Campus/School

Exchange Online (including

Protection& Archiving)

Plans 1 & 2, Commercial, Government, Faculty and

Student, Archive, Encryption, Protection, Forefront Online

Protection

Office 365 Enterprise

Plans E1, E3, E4, A2-A4 Commercial, Faculty and

_{Student, E1 Archiving}

Office 365 Midsize Business

M All seat definitions

Office 365 Pro Plus

Commercial, Faculty, Government and Student

Project Online

Project Online, Project Lite, Project Online with Project

Pro O365, Project Pro for O365, Project Online for

Students and Faculty

SharePoint Online

Plans 1 & 2 with Yammer, One Drive Business w/Office

_{Online, Extra File Storage, Yammer Enterprise}

Visio Online

Visio / Visio Pro Commercial, Faculty and Student

Power BI

Commercial, Faculty and Student

Azure via Open

Commercial, Government, Faculty and Student

Enterprise Mobility Services

Windows Intune, Enterprise Mobility Suite

Office 365 Small Business Premium

ESD

Length of

Subscription

SKU

Bundle

5

Incentive Rate

(Based On Billed

Revenue)

12 months (Paid

(12)

Commercial Distribution

global accelerators

locally-chosen

accelerator list

• IT Academy

Core

Growth

Incubation

1.5%

2%

4%

2.5%

Annuity

7%

Annuity

12%

Annuity

Cloud

• Cloud Revenue Growth

• Cloud Partner Reach

• Open Renewal – All Tiers

• GeoX Reach

Legend

Non-Annuity rate

Annuity Rate

Coop/ Rebate split

50%/50%

Coop/ Rebate split

33%/67%

8%

corporate-defined

component

Paid on New & Renewal Open License agreements

On-premise incentives paid on revenue sold to SMB customers

Cloud incentives paid on revenue sold to customers in all

market segments

Open on-premise revenue excludes Tier 1 Reseller Revenue

(13)

Azure via Open Incentive & Promotion

Announcing | For FY15

Base Channel Incentive 8%

+

Special FY15 Incentive 12%*

Total of 20%*

* Until 3/31/2015, for Commercial Distributors and eligible

Managed Resellers. Special 12% promotional incentive paid on

sales to SMB customers only.

(14)

Global IT Academy Accelerator

Global accelerator of 7% on sales of defined IT Academy products sold via Open

Commercial Distributor Measurement

Rate

Rebate

Portion

Coop

Portion

IT Academy

OVS and Open Academic revenue sold to Tier 2-4 resellers of

IT Academy part numbers 54R-00141, 54R-00142, 54R-00159,

and 54R-00160

7%

100%

0%

Microsoft Academic

Certifications

Site pack of 500 Microsoft

Office Specialist (MOS) exams

OVS-ES (Level E)

H5T-00004

7%

100%

0%

OVS-ES (Level F)

H5T-00005

7%

100%

0%

Site pack of 250 Microsoft

Technology Associate (MTA)

exams

OVS-ES (Level E)

H5T-00007

7%

100%

0%

OVS-ES (Level F)

H5T-00008

7%

100%

0%

Class pack of 30 Microsoft

Certified Professional (MCP)

exam vouchers

OVS-ES (Level E)

H5T-00001

7%

100%

0%

OVS-ES (Level F)

H5T-00002

7%

100%

0%

(15)

DISTI attains Eligible Competency by Jun 13

th

₂₀₁₄

FY15 H1 DSA Program

DISTI receives DSA incentive (10% of invoice value for

eligible products) - 50/50 Rebate/Coop

DISTI sells solution workloads through Resellers

DISTI is enrolled in DSA for FY15 (Done by Ops)

CALL TO ACTION • Use the DSA Incentive Estimation Tool to determine potential incentives your DISTI can earn • Work with your DISTI to get MPN Certification on or before Jun 13th_{2014 (no exceptions)}

• Build a plan to drive execution using the DSA Execution Guide and Playbook

Workload

Disti Competency

_{(Silver or Gold)}

Eligible Products

Min Required Products

_{in an single order (Invoice)}

Virtualization and Management Virtualization and Management Windows Server Datacenter System Center Server

3 Servers (any mix) from: • Windows Server Datacenter • System Center Server Standard • System Center Server Datacenter

Virtual Desktop (BYOD)

Server Platform Windows Remote Desktop Services Windows Server Standard

Windows Server Datacenter

• 1 Windows Server Standard OR 1 Windows Server Datacenter AND

• 25 Windows Remote Desktop Services CALS

Business Analytics (On-Premise) Business Intelligence SQL Server BI Edition SQL Server Enterprise Core ALM Solutions

Pro Developer Tools

SharePoint Server, SharePoint CAL Windows Server Datacenter Windows Server Standard

• 1 SQL BI or 2 SQL Enterprise Core (4 Cores) AND

• 1 of the following servers:-- Windows Server Standard - Windows Server Datacenter - SharePoint Servers

Business Analytics (Online) Power BI in Open: Power BI in Open: 5 users

Unified Communications Communications Lync Server, Lync CAL

SharePoint Servers, SharePoint CAL

• 1 Server (Lync or SharePoint) AND

• 25 CALs (Lync or SharePoint)

Important: A product qualifying for multiple DSA workloads on a single

(16)

Understanding Coop

Coop Activities

(17)

Earning and Usage Periods

Per program calculation against

eligible revenue

Distributor Incentives

Managed Reseller Incentives

Earn

H2 Program Period (1 JAN -30 JUN)

Jan Feb Mar Apr May Jun

H1 Program Period (1 JUL -31 DEC)

Jul Aug Sep Oct Nov Dec

Q2

Q1 Q3 Q4

15 August

Funds Available = Rebate Payment and Coop available for Previous Fiscal Year’s H2 earnings

15 February

Funds Available = Rebate Payment and Coop available for Previous Fiscal Half earnings

Rebate + Coop

DISTI & Managed Reseller Incentive programs run on a 6 month program period. Accrued funds are calculated based on eligible revenue from previous fiscal half, and calculated per the rates and terms of the program agreement.

Extends to next fiscal year H1 Program Period

Partner is eligible to earn rebates and coop funds through sales of eligible licenses and products

during the Earning period (6-month)

When partner meets all requirements, rebate and coop funds are then

AWARDED for Payment & Usage. Rebates

are paid automatically and coop funds are paid against eligible activity claims.

Partner claims earned coop funds after an eligible market development, demand generation, or readiness activity

is performed during the 6-month

(18)

Eligible Coop Activities

– Commercial Distributors



Online Advertising



Web Advertising



Direct Mail



Direct Email



Mobile SMS



Microsoft Training Tuition

fees



MPN Registration Fees



Microsoft Exam Fees



Microsoft conference

registration fees



Microsoft On-site Sales

Training, including Floor

Day Expenses



Microsoft Conference

Travel & Hotel



Product Demo/Seed Units

market development

partner readiness

demand generation



Customer Offers & Incentives



Telemarketing Services



On-site Champs



Tradeshows



Internal incentive & SPIFFs



E-Commerce



Proof of Concept Services



Bootcamps



Seminars



Multi-Vendor Expositions



Social Media or Mobile

Commerce



Web Syndication

(19)

Principles of Coop

Pay for

Performance

Earn funds then

use funds

Conduct activity

then claim

reimbursement

Predictable

Funds grow as

business grows

Clear

performance

lever

computation of

funds earned

Support

Business Goals

Gain Channel

mindshare and

preference for

Microsoft

Accelerate Sales

Span Partner

Engagement

Lifecycle

Many Coop

eligible activities

such as readiness

and enablement,

demand

generation and

selling

Leverage

Distributor’s

Capabilities

DISTIs have existing

assets to reach and

activate resellers:

Web and Telesales

engine, In-house

licensing and sales

expertise, Reseller

database, etc.

(20)

Guidelines for Coop

Key Exclusions

• Promotion of Competitors

• Capital Expenditures

• Administrative Costs/Overhead

• T&E (except as outlined for limited events such as WPC)

Prominently displayed

Coop tagline

in Demand Generation and

some Market Development

activities

Prominently displayed

Company/Brand name

and Contact information

In Demand Generation and

some Market Development

activities.

Minimum 30% Microsoft

content

that furthers the marketing

and promotion of

Microsoft software

in Demand Generation

and Market Development

(21)

Prepare & Plan

Approve Plan

Validate Claims

Results Review

Note: Figures exclude North America; Legend:

Green

DISTI Action;

Blue

Field action;

Purple

– Corp Action

Execute Activity

Submit Claims

Field

Partner

Ops/IT/Claims

Corp

DPAM/PSMM Take Training Develop Quality Mktg Plans On-boarded to CHIP

Contracts in place On-boarded to CHIP Trained on Program/Tool Coop Funds Visibility Quality of Marketing Plans

Contracts/Notices in place Funds Calculation and CHIP Upload/Configuration. Timely Onboarding of Partners and Field.

Program Design Program Guideline Dev’t Marketing Plan Guidance Readiness Content and Delivery

Get CHIP Access

DPAM Timely plan approval PSMM drive plan quality Encourage Program compliance

Submit MD Plan for review Execute After Approval Follow Program Guidelines Use Preapproval Option

CHIP Issue Resolution CHIP Activity Reporting Notifications/Override on plan approvals

Creative Piece Pre-approval

Funds Tracking

PSMM Ensure Execution plan is delivered. Provide

resources/templates and program guideline consultations.

Execute according to approved plan and program guidelines Gather POE materials

Respond to program guideline questions

Notices/Reminder on Claim Submission

Campaign Resources Program Clarification

Encourage immediate claim. Review Claim Rates in DHI, QBR or Monthly Reviews

Submit claims on CHIP as soon

as activity is completed CHIP Issue ResolutionCHIP Activity Reporting Reminders -Claim Submission

Funds Tracking

Program Status Reporting

Offer clarifications/context or exception justification when necessary.

Provide adequate POE to prove

guidelines have been met. Review/Audit of Claims and POEHandle Exceptions Evaluate Exception CasesProgram Status Reporting