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Last week I was in Carlsbad, CA for ShoreTel's industry analyst conference, held during the company’s Champions Partner Conference. As far as analyst events go, this was a very good conference, with lots of access to the ShoreTel executives and product people, and everyone was very open and forthcoming both during the sessions and in private discussions. The best part was the fact that it was held in conjunction with ShoreTel’s reseller/partner conference, allowing us to chat with the resellers and get their perspectives on the company and products, as well as the new announcements. One thing was clear--the resellers love ShoreTel and the product--they love the simplicity, the fact that the product is an all-in-one solution that is easy for them to sell, and the company's customer satisfaction rates are extremely high.

What I heard from the partners really tied in with Shoretel’s new tag line, "Brilliantly Simple." According to Kevin Gavin, ShoreTel’s VP of Marketing, ShoreTel "went to existing customers and tried to understand what customers really like about ShoreTel." Customers noted that what they like about the product is that it’s simpler and less complicated than other systems, and easy to use, but "it's not simplistic." ShoreTel’s reseller partners seem to agree. When I asked several of them what it is they like about the product, they noted that the product is easy to purchase, implement, and use, but is full featured and well designed. The consensus, from the resellers and ShoreTel, was that ShoreTel’s biggest challenge is being brought to the table for customer deals, or what the company refers to as consideration. When companies are considering a new business phone, they only consider ShoreTel about 15% of the time, due to the company's lack of name recognition.

Most organizations haven’t heard of ShoreTel and the resellers have to spend a good amount of time educating their customers about ShoreTel and its value proposition. According to a few resellers, a number of their sales are based on personal relationships they have with the customer, and the reseller uses this opportunity to introduce the customer to ShoreTel.

There were several new announcements at the event, including integration with IBM Foundations for a "UC in the box" solution (go to ucstrategies.com to listen to my podcast with IBM's Caleb Barlow) providing a single unified platform. When I asked the resellers what they thought about the Foundations/ShoreTel solution, most of them were very excited and thought that it would be a great addition to their product offerings. But they did have lots of questions and wanted to get more information and details, especially about the logistics, since there’ll be a three-tier distribution model using ScanSource as the distributor.

During a meeting with Kevin Gavin, I asked him about the company’s successful recent quarter and what he attributes it to. He noted that there was not one single factor, but rather several things that worked in the company’s favor, including strong international revenue growth, strong contact center business growth, and successfully moving upmarket and getting more large enterprises on board. The company is also benefitting from Nortel’s demise, and Kevin noted that when companies are evaluating vendors, "they usually bring three vendors to the table, and in the past it's been Cisco, Avaya, and Nortel." With Nortel out of the picture, this leaves an open seat at the table and ShoreTel is being invited to participate in more bids. Kevin noted that when ShoreTel does get "invited," they have a very high win rate, and the company expects to "move from being a second tier player to one of the top tier player." Going forward, ShoreTel is optimistic that this is the beginning of a new growth phase.

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IBM not a cure Comment by Contrarian Jul 28, 2010, 09:04 AM EDT Several vendors have attached their communication applications to various IBM packages (3Com, Nortel, etc). Have ANY been even mildly successful? IBM isn't a great route to market for this. ShoreTel is just the latest with IBM stars in their eyes.

1 - IBM not a cure Comment by Contrarian Jul 28, 2010, 09:04 AM EDT Several vendors have attached their communication applications to various IBM packages (3Com, Nortel, etc). Have ANY been even mildly successful? IBM isn't a great route to market for this. ShoreTel is just the latest with IBM stars in their eyes.

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