VARs Hit the Jackpot with Digital Signage Sales

Developer Rise Vision offers new SaaS-based digital-signage solution to channel that provides double-digit margins for channel partners. Market is poised for strong growth.

The opportunity for VARs to earn extremely high margins is a long shot in the current market, but the fast-growing digital-signage space appears an exception to this rule. Some VARs say they are making margins of more than 50 percent on their digital-signage sales.

One reason is that the digital signage market is poised for sharp growth. Research firm Frost & Sullivan forecasts that the worldwide digital signage systems market will grow from $313.9 million in revenues in 2006 to more than $1 billion in 2012 at a compound annual growth rate of more than 20 percent.

Another reason is that developers are offering more digital-signage solutions to VARs and other channel partners. While it helps to be a digital-signage specialist to make the highest margins, ordinary VARs can make them too, said Peter Mateyko, reseller manager, Rise Vision, an Ontario-based developer of the Rise Display Network (RDN), a web-based, Software-as-a-Service (SaaS) content-management system for digital signage.

“Our solution gives VARs complete control over how they bill (monthly, quarterly, annually) as well as how much they charge,” he said. “By becoming one of our private network operators, a VAR should easily make 70 to 95 percent margins just on the ongoing software subscriptions.”

On top of that, Rise Vision gives VARs opportunities to provide value-added creative services and content management services that further enhance their margins on the digital-signage sale, said Mateyko.

High-Margin Opportunity

Some VARs that the recurring revenue stream offering by Rise Vision digital-signage solution is providing them hefty double-digit margins

“We are making 40 to 50 points selling digital signage systems that run the Rise Vision software, with a lot of the points coming from recurring revenue,” said Duane Weber, president, AutoComm Inc., a digital signage VAR in Appleton, Wis. “Rise Vision’s SaaS makes it so easy for us to sell the solution and to profit from it." Weber's company recently joined Rise Vision’s private network VAR program.

Mateyko said the VAR program enables VARs to combine Rise Vision’s technology and experience with their own brand and message, enabling VARs to provide a complete display solution and to enjoy ongoing, recurring revenue. 

“In these turbulent economic times, end-user companies are leaning toward SaaS models to minimize capital expenditures,” said Mateyko. “Our VAR program ensures that our reseller partners have a simple, cost-effective solution for selling SaaS-based digital signage.”

Weber explained that SaaS enables his customers to pay-as-they-go, adding screens and content as they choose, rather than paying upfront for entire systems – all of which simplifies the sale.

“We make good money providing and managing content as many of our customers such as small local banks and credit unions lack the in-house ability to create and manage content,” said Weber.

Rise Vision has upped its visibility in the channel since September, when it signed a bundle deal with Ingram Micro that offers resellers a discounted digital-signage package. The agreement provides all of the key components VARs need to install a digital signage solution, with discounts of between $1,100 and $1,200 from each manufacturer’s suggested retail price.

The solution includes the RDN; 40-inch or 46-inch LCD displays from the Samsung DX Series; Peerless Universal Tilt Wall mounts to secure the screens to a customer’s wall; and the AOpen digital media player to drive the display.

TAGS: developer,Microsoft,SaaS,digital signage,VARs

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