In Store Solutions: Building Worldwide Distribution for Skype Hardware

Note: Denali InterConneXions, publisher of Voice On The Web, has taken on In Store Solutions as a business development client; see the more complete disclosure at the end of this post.

ISSLogo.280px Over my three years of following Skype as a blogger there have been many ups and downs in the availability of Skype Certified hardware. In my October 2007 Skype Primer series, published at the time Skype had announced a search for a new President, I had stated in Skype Hardware – If and When Available:

Having been involved for several years in the hardware distribution channel, the formula is not that difficult:

  • Skype, as the real time conversations service provider and royalty recipient from the hardware vendors, not only needs to set the engineering standards for these phones, in particular via the firmware (and they do this quite well), but also needs to execute a significant “Skype Sanctioned” marketing campaign to generate awareness and “pull” (à la “Intel Inside” for PC’s).
  • At the same time hardware vendors, many of whom already have distributor relationships, need to incorporate standard distribution marketing practices, such as market development funds and appropriate promotional packaging, into their cost models as the hardware vendor is ultimately responsible for the “push”.

These criteria apply even in these days of electronic purchasing via e-commerce sites.

With the recent launch of the FREETALK® Everyman Headset, Skype has partnered with long-time hardware distribution partner In Store Solutions to provide the first in a new line of hardware specifically designed to address issues with improving the Skype calling experience.

Two years ago at CeBit I was introduced to In Store Solutions as a distributor of Skype Certified hardware. Having had over 20 years experience working with PC distribution channels I was impressed with how COO Craig Smith approached the retailing of hardware, especially in terms of packaging and building distribution networks. In the interim I have had some dealings with In Store Solutions where customer service and ensuring that customers were satisfied with their purchases was definitely a priority. For the past twenty months my primary headset for Skype calls has been the FREETALK® Wireless Stereo Headset for which a second generation version was recently released.

My previous experience with PC hardware distribution within North America was relatively “simple”. I dealt with two countries (Canada and U.S.) and two currencies (US$ and C$) along with any associated federal and provincial/state taxes; systems were set up to provide rapid delivery while dealing with (sales and value-added) taxes in different jurisdictions. And customs clearance along with warehousing logistics were also distribution issues.

However, to be successful across Skype’s worldwide market geography, Skype Certified hardware needs to be distributed to over 180 countries, to deal with a maze of local tax issues, to execute transactions in at least 40 currencies and, at the same time, to be marketed in at least the 28 languages supported by Skype. Add to this the issue of increasing sales of hardware via e-commerce platforms while getting stocked with inventory at various retail operations.

At this point, In Store Solutions has developed:

  • Key product supply relationships with Skype Certified hardware manufacturers
  • A strategic partnership relationship with Skype involving not only the design and distribution of Skype Certified hardware but also its marketing
  • An e-commerce engine that is currently operating, via the Skype Store, in 67 countries covering 40 currencies and multiple languages
  • A forthcoming line of hardware that will address leading edge requirements for headsets, Skype phones, webcams and business products.
  • A worldwide network of distribution warehouses to minimize delivery times and customs clearance issues within specific countries
  • Retail distribution via WalMart, Sears and Synnex in the U.S., Staples and Maplin in the U.K. as well as retailers in Europe and Australia
  • Customer support that includes a “no questions asked” return policy to ensure user satisfaction

FT_logo_web_120x42 Over the next few months In Store Solutions will be not only launching additional FREETALK® products but also distributing Skype Certified products from other hardware manufacturers. It’s not simply about the e-commerce platform but rather the inclusion of logistics infrastructure and back office transaction-related issues such as payments handling, currency, order tracking and fulfillment along with customer support that are required to build a worldwide online commercial operation.

PayPal operates as an “uber-bank” supporting payments in 18 currencies across 190 markets linking back to banks and credit card services worldwide. Skype operates as an “uber-communications” infrastructure supporting conversations worldwide, independent of underlying carriers or service providers. In a similar vein Store Solutions is developing a “uber-store” capability that ensures Skype hardware products can be purchased worldwide at low cost while addressing country-specific issues such as currency and delivery times.

Full disclosure: In Store Solutions has become a client of Denali InterConneXions, publisher of Voice On The Web, building on the author’s previous business development experience with establishing partnerships that can assist with the promotion of a primary vendor’s offerings. A more complete statement will follow shortly.

About Jim Courtney

Bringing over thirty years' experience in the sales, marketing and management of cutting edge technology businesses.

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