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Splunk CEO: Partners Are Feet on Street; New Relic Deal Holds Promise

Splunk (SPLK), which makes operational intelligence and log management software, continues to double down on channel partners, and sees great promise for a recent New Relic partnership. Splunk CEO Doug Merritt shared those insights, and more, during the company’s fiscal Q1 2018 earnings call Thursday.

Splunk’s revenues hit $242.4 million during Q1 2018, up 30 percent from the corresponding quarter last year. Some analysts noted a slightly higher than usual uptick in the company’s professional services revenues. But CEO Doug Merritt quickly shifted the earnings call discussion away from direct sales and toward channel partners.

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“Our issue is how do we make sure [customers] understand that Splunk exists,” said Merritt. “How do we make sure they understand the strength of Splunk and the use cases that we’re best tuned for.”

Brooke Cunningham

To address those needs, Splunk realizes it needs more feet on the street — in the form of partners. “There is only so much that we can do as far as our capacity to hire and train [people],” said Merritt. “So starting really four years ago — and with a hard emphasis about three years ago — we really started to rotate much more aggressively on channel.”

Among the proof points: Splunk’s sales team receives the same commission rate whether a deal is sold directly or through partners. Channel Chief Brooke Cunningham provided deeper partner program details during a podcast with ChannelE2E & CompTIA CEO Todd Thibodeaux in February.

Splunk & New Relic vs. Cisco AppDynamics?

Despite Splunk’s momentum, the company could soon face more competition from AppDynamics, which Cisco acquired earlier this year. On the one hand, Cisco and Splunk have a close partnership. But on the other, AppDynamics has been extending from its application performance monitoring (APM) heritage toward analytics.

Merritt downplays the potential competition, pointing out that Splunk and AppDynamics integrate with one another. Plus, he adds, Splunk has a growing relationship with AppDynamics’ core rival — New Relic.

In fact, Splunk has seen some good initial uptake” from the New Relic integration, he adds. “And as we get some success stories, I’m sure I’ll share those with your guys in the coming quarters.”

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