Windows 10 devices are winning with resellers

By on

This article appeared in the July 2018 issue of CRN magazine.

Subscribe now

Windows 10 devices are winning with resellers

It has been tough to make a buck selling bog-standard laptops ever since the discount electrical giants turned their attention from home entertainment to budget PCs. Even the basic business laptop is at the mercy of cut-throat pricing. Thankfully for the channel, there has been a boom in premium devices that pack more grunt under the bonnet and sport productivity-friendly designs.

Portable workhorses such as the Dell XPS, Lenovo X1 Carbon and HP Spectre are popular. Beyond the traditional clamshell design, there is also huge interest in 2-in-1 hybrids, says Lillian Tay, principal analyst with Gartner’s personal technologies team.

Hybrids accounted for 20 percent of all mobile PC shipments in Australia last year and the market segment is growing rapidly, she says. This rises to 48 percent once you include premium lightweight clamshell laptops, which tip the scales at less than 1.6kg, with HP, Lenovo and Apple the top three vendors.

“Business buyers don’t just shop for laptops on price alone,” Tay says. “With engaged PC users it becomes an easier sale knowing what really matters to them.

“Important aspects include computing performance, weight, battery life, build quality, screen size, aesthetics design and of course productivity contribution.”

The Lenovo ThinkPad X1 Carbon and HP Spectre ranges are best-sellers for corporate office supplies retailer Winc, while the Microsoft Surface Pro is seen as the benchmark among hybrids. Winc rebranded from Staples Australia and New Zealand last year as part of a service-oriented pivot. It has found success in selling premium laptops to commercial and enterprise customers, as well as government agencies.

Margin pressure

Product-only margins are tight and this trend extends to the premium laptop ranges, although some vendors offer rebate accelerators for these ranges, says Jarad Nass, Winc’s solutions general manager.

“This is nothing new for the VAR community, where better margins are made through delivering higher customer value via value-added services,” Nass says. “A competitive product-only engagement is inevitably a race to the bottom.

“The provision of increased customer value-added services is fundamental to improved margins. Basic approaches include the bundling of accessories and upgraded or extended warranties, but other emerging trends include ‘desktop as a service’ and other consumption based solutions.”

Winc is focused on providing customers “the best fit for purpose workplace solutions across mobility, security, productivity and cloud”. Premium laptops are often part of the solution stack and Winc has formed strong partnerships with HP, Lenovo, Microsoft and Dell.

Dell has a dual go-to-market strategy, selling both direct and via partners such as Winc. Dell’s client solutions group general manager, Robert Vinokurov, agrees that margins still remain tight at the top-end of laptop sales.

Channel partners still need to price premium products to sell, Vinokurov says. “You can’t extract super-normal profits at the premium end just because it’s premium, or else you’ll price yourself out of contention.

“If anything, what you want to do is improve the value proposition as you move up the stack to make it compelling for people to move up.”

Dell is seeing stronger interest in 2-in-1 convertible designs than in those with detachable keyboards, particularly at the premium end of laptop sales. The convenience of the form factor, along with other productivity-focused features, are driving take-up more than processing power, Vinokurov says.

“The standard clamshell isn’t always the most convenient form factor, such as when you’re reviewing documents on a plane, and this is when the appeal of the 2-in1 convertible comes into play,” he says. “These days business customers expect more than raw horsepower from a premium laptop; they expect a great all-round productivity tool.”

Productivity benefits

Premium laptop makers are in tune with these higher customer expectations. They’re focusing not just on sleek designs but also leveraging the productivity benefits offered by Windows 10.

Customers expect not just better performance, but also a better overall experience from their premium laptops, says Chris Osborne, Lenovo’s senior manager, product marketing. “Windows 10 allows more ways for people to interact with their laptop, through touch and a pen, so we’ve built our hardware to support these enhancements.

“Our X1 Carbon range also includes other features our customers love, such as the infrared camera to support Windows Hello, far-field microphones for better audio quality and high quality screens.”

Lenovo is seeing strong demand for premium products such as the ThinkPad X1 Carbon and X1 Yoga notebooks, he says. Customers willing to pay a premium for ultra-portable devices, long battery life and modern features such as USB-C connectors. As with Dell, Lenovo’s 2-in-1 designs with a foldback keyboard are seeing more interest and sales growth rather than tablets with a detachable keyboard.

The productivity benefits of Microsoft’s Windows 10 and Office 365 don’t only help sell premium laptops, they also create professional services opportunities for channel players looking to increase engagement with customers.

Perth-based IT support provider TechBrain favours the HP Spectre as a premium laptop for its customers but, rather than relying on hardware sales alone, TechBrain builds a package of professional services around them, says general manager Mike Fernando.

TechBrain favours HP Spectres over ultrabooks because they are similarly priced but offer much better functionality, he says. Support for 4G mobile broadband connections also appeals to corporate users on the move, as it eliminates the need to tether to their smartphone and thus saves the phone’s battery life.

“The HP Spectres are a great fit for our customers, but the professional services that we include are the key, such showing executives how to use OneNote and sketch on the screen, as well annotate and sign documents,” Fernando says.

“Lightening the load in their travel bag while extending battery life is great, but when you’re showing the customer how to leverage their investment to boost productivity, that’s when you’re taking that relationship to the next level.”

Approaching the market as a solutions provider and trusted advisor, rather than simply a hardware reseller, is a common theme among successful channel players when it comes to selling premium laptops, says Gartner’s Tay.

“The selling conversation is not centered around price,” Tay says, “but instead it’s centred around what is the correct tool that employees require to meet the business objectives.”

Building on this approach, managed service providers are incorporating hardware into ‘as a service’ models, which completely change the dynamics of supplying devices like premium laptops to their customers.

Offering premium laptops is “just another part of the service that we provide to clients,” says Harry Ioannou, sales manager with Brennan IT.

“We don’t see premium laptops as a strategic element of a deal, they’re usually part of wider sales conversations,” Ioannou says. “Understanding who needs what and advising the right mix of devices is much more aligned with the value-add that we provide to our clients.”

The managed service provider saw a market opportunity in the inability for companies to refresh their hardware as often as they would prefer. It also identified an opportunity to streamline end user device management and bring it into line with the management of all other end user services – such as licensing and support – which were often running on very separate schedules.

Brennan IT took a multi-pronged approach to this challenge. First it developed a Lifecycle Asset Management service, backed by Macquarie Bank, to provide devices on a flexible financing solution. This allows clients to lease their devices over a set period, with either a refresh or buy-out option at the end of the contract.

“This takes away the cash pressures involved with upgrading their fleet of devices and allows clients to refresh to the latest specs a lot more frequently than before, not to mention easing the management burden of end user devices,” Ioannou says.


KIT OUT 

I have a Microsoft Surface Pro, I chose it as it’s a 2-in-1 PC and tablet, plus it’s lightweight and easy for travel. I travel a lot and am rarely in an office, so I find it extremely travel-friendly and does everything I need in one device.

- Faith Rees, chief executive, SixPivot

I use an HP EliteBook x360 1020 G2 Notebook with HP Sure View with a digital pen. I selected the HP EliteBook as it doubles as a tablet and notebook, is super-light and thin which is awesome for travel and for taking notes in meetings with the keyboard or pen and has a touch screen.

- Jo Masters, chief executive, Tquila ANZ

On my desk I have a Dell XPS 15, for the resolution on the screen, and a Samsung Android Galaxy Tablet for reading email and very quick information gathering. I’ve recently added a Microsoft Surface Book and I love the ability to be able to detach the screen from the keyboard and use as a tablet with a pen.

- Nick Stranks, alliance manager, Ethan Group

Got a news tip for our journalists? Share it with us anonymously here.
Copyright © CRN Australia. All rights reserved.
Tags:

Most Read Articles

You must be a registered member of CRN to post a comment.
| Register

Poll

What does 2019 hold for you?
Business as usual, focused on organic growth
I'm looking to sell my business
I'm going to acquire another business
View poll archive

Log In

Username / Email:
Password:
  |  Forgot your password?