While Google Cloud recently made a show of boosting its partners, internal changes suggest the company is taking steps to prioritize itself — at least when it comes to sales.
Announced internally to management last week and again to employees on Monday, the company is walking back a key part of its sales compensation structure that gave salespeople the same incentives whether they sold Google Cloud's own products or those listed in its marketplace for third-party partners, four sources told Insider.
Now, sources say, Google Cloud has introduced a cap of 30% on how much selling a partner's product via the company's marketplace will count towards a salesperson's quota. In other words, in a hypothetical example where a Google Cloud salesperson closes a deal for $100,000 worth of a partner's product via the marketplace, only $30,000 of it will count towards their quota for the period.
However, selling the company's own services has no such cap, giving salespeople a larger incentive to focus on Google Cloud's own product line. At that meeting, Google Cloud executives characterized the move as bringing the company in line with "industry standards," the sources said.
Google Cloud declined to comment for this story, but on Tuesday announced several new changes to its partnership program, and unveiled plans to more than double its spending to support its partner ecosystem over the next several years.
The previous sales structure was a big hit with several of Google Cloud's partners, who recently told Insider that its approach amounted to something of a secret weapon against rivals Amazon Web Services and Microsoft. Partners were attracted to working with Google Cloud by the promise that its salespeople would push their solutions as hard as they pushed its home-grown products.
Some at Google Cloud believe there's more to the change than aligning with "industry standards," with two employees telling Insider that the previous structure was costly for the company — which is important, as the Google Cloud unit is not yet profitable.
Those employees also believe that in practice, it meant that customers ended up using a lot of products and services from Google Cloud's partners, but not from the company itself. It also meant that salespeople, too, would use company time and resources to sell software from partners like MongoDB or Redis rather than Google Cloud's own database products.
On the other hand, one Google Cloud employee expects the new plan will mean that fewer partners are included in customer deals at all, given that salespeople will have a higher incentive to sell first-party products.
At the same time, the announcements made on Tuesday show that Google Cloud is investing in its partner ecosystem in other ways, even as salespeople focus on its in-house product line.
Specifically, Google Cloud's blog post details plans to roll out new incentives and rebates that will reward partners who invest in providing professional services — helping customers build, manage, and maintain their Google Cloud infrastructure. It also pledged to expand its teams that work with partners, even as it launches new programs to reach its goals of training 40 million people in Google Cloud-related skills.
"The need for highly-skilled partners to accelerate digital transformation for customers has never been greater, and our ecosystem of services partners continues to gain tremendous opportunities to deliver high-value implementation and professional services, industry solutions, and digital transformation expertise," said Google Cloud's blog post.
This isn't the first time in recent memory that we've seen changes to how Google Cloud sees its salesforce approaches working with partners. Late last year, the Information's Kevin McLaughlin reported that the company staged a crackdown on partners who resold non-Google software from the Google Cloud marketplace — a move said to throw customer deals worth hundreds of millions of dollars into limbo. This week, Google Cloud told CRN's Donna Goodison that it will allow those partners to sell third-party software from the marketplace once again.
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