SiriusDecisions has identified four key issues that any organization selling through partners must focus on.
With the importance of third-party channel partners growing rapidly for an increasing number of b-to-b organizations, it’s amazing how little so many of these organizations understand, much less actively manage their channel. This is particularly true in the area of channel marketing and channel management, where more dollars are being spent in the care and feeding of partners, often without real insight into how – or even whether – these dollars are making any impact.
Based on our discussions with b-to-b channel marketing executives, SiriusDecisions has identified four issues that should dominate channel planning agendas into the upcoming year and beyond. In this issue of SiriusPerspectives we explore these issues, and provide our recommendations on how to maximize your strategies and competencies around each one.
ONE: OUTSIDE-IN AUDIT
Many organizations struggle to create and execute a successful channels plan simply because they do not maintain an understanding of the current state of affairs with their partners, as well as the marketplaces that these partners are selling in. SiriusDecisions recommends using the following to form a focused, repeatable agenda for a quarterly face-to-face audit with major partners that includes:
- Channel policies and procedures. A close examination of the way you do business with your partners will quickly reveal various policies and procedures that make it a disincentive to work with you. Each quarter, focus on a specific policy area to make things manageable for both you and your partners; you can report back on your progress in addressing issues in subsequent quarters to demonstrate that the feedback was not only listened to, it generated action.
- Marketing program performance. Channel marketing is charged with two specific tasks to aid partners: demand creation in the form of lead generation and development, and channel enablement in the form of tools, training and collateral. Many b-to-b organizations have very weak channel demand creation processes, dumping significant numbers of highly unqualified leads on partners, and then wondering why partners don’t perform better. Refining these processes on a regular basis, and also discovering where you should prioritize your channel enablement efforts can go a long way toward forging a better relationship with the channel.
- Competitive activity. Partners are on the front lines; they not only know what customers and prospects are saying about you, but also your competitors. Keeping your finger on this pulse is vital; what have partners seen major competitors do in deals to try to counteract your value proposition? Are these competitors using specific messaging or collateral that is resonating with specific audiences or marketplaces better than what you have created?
TWO: PERFORMANCE AUDIT
You will certainly need an audit that extends the other way, using a set of agnostic criteria to judge the performance of one partner versus another. Typical partner performance audit categories include sales performance, discounting performance (frequency, amount), profitability and future growth potential. We also have seen organizations weave in some “softer” metrics that are indicative of a partner’s ability to be successful, including sales and marketing capabilities (does a partner have the horsepower to take advantage of the dollars, leads and enablement materials you are feeding it), customer satisfaction and quality/depth of business relationship.
If there are other industry- or market-specific factors that are important to your organization, by all means add them. The key here is to create a list of variables and a scoring system that key partners can be run through in a neutral fashion. Just as important, the organization needs to create a partner plan for those that score in the bottom group, whether it is a quartile or quintile, as well as a “watch” strategy for partners that fall just above this line. This should be socialized with partners in advance, so there will be no surprises for partners when action is required. SiriusDecisions will provide additional thoughts on judging partner performance and creation action plans in a future research brief.
THREE: MARKETING'S LOYALTY ROLE
Partner loyalty is often seen as purely the bailiwick of channel management; we believe this conventional wisdom isn’t so wise. Channel marketing can and should share in this responsibility in three key ways:
- Field visits. While core partners are used to seeing their sales rep, they seldom if ever see individuals from marketing. By budgeting time and resources to this activity, channel marketing can review issues related to demand creation, market development funds, and cooperative programs focused on both demand creation and channel enablement. Participating in the outside-in audit mentioned above is a perfect opportunity for these visits.
- Marketing plans. Most channel partners are entrepreneurs that shy away from marketing planning, purely because they don’t have time or the horsepower to develop plans for each of the vendors they represent. You can provide added value by developing compact, modular marketing plans that target key business issues and goals, and set commitments on both sides for tasks and actions. These plans can then be used as a measuring stick during your performance audit.
- Loyalty programs. We have seen particularly innovative channel marketing functions have significant value in the creation of point-based programs that offer cashless incentives to drive desired behavior (such as reduced discounting and compliance with demand creation/sales enablement rules of engagement) and loyalty. Points can be structured to be redeemed for a variety of uses, including everything from additional training to travel, free admission to partner events and even electronics.
FOUR: TECHNOLOGY MAXIMIZATION
Marketing, sales, order processing and communications are critical to maintaining good channel relationships, and it is now virtually impossible to manage all of them without a partner relationship management (PRM) system. The PRM system is a central hub where all vendor interactions are localized; a growing number of point tools now bolt into hubs offered by companies that include Blueroads and Salesforce.com, including sales force automation, contact management, customer support and training.
The implementation of PRM tools can be extremely complex, as you must navigate your own environment, as well as the environments of your partners. Success with these types of implementations generally comes from selecting a small group of your best partners and building requirements in conjunction with them, rather than trying to do it on your own. By testing core PRM systems and any add-ons with a small group, you significantly lower the risk of a failed mass rollout.
Finally, it’s important to note that PRM systems will be used to tie you to your best partners, not to all your partners. A solid, efficient PRM platform is of benefit to partners as much as it is to vendors; therefore, participation is not a right but a privilege. Only those partners that consistently score in the upper levels of your audits should be offered entry into any technological program, although the benefits can be advertised to all partners as an incentive to improve their performance.
THE SIRIUS DECISION
In the end, good channel relationships are two-way streets. By demonstrating they have plans, processes and systems designed to optimize the channel experience – and are committed to refining each over time as required – vendors are showing they are willing to do their part. But by not including all partners in everything they do, they drive partners to hold up their end of the bargain, or be treated like the masses. Finally, by actively managing their partner rosters, they regularly identify partners who really don’t want to be partners at all, a fact that no vendor should ever be afraid of learning.
|
 
|
