Every channel partner represents a set of resources. As with any resource, there is investment required to access and make the most of them. Let’s take a look first at what you’re investing in, then talk more about the investments themselves.
When a channel partner joins your partner program, they’re giving you access to their salespeople, their technical people, their administrative people, their leadership team and more. You’re not paying directly for those assets, and how much attention you get absolutely depends on how you manage them.
Beyond their personnel, you also gain access to an even more valuable resource: partners’ customers. These are all well-qualified customers, each of whom has a purchasing history. You not only gain access to them, but you gain access to the already-well-developed relationships those channel partners enjoy with them. When you compare this with what it would cost you to find, approach, penetrate, develop a relationship with, and sell to that many customers, the potential return becomes extremely clear.
What will you invest? You will invest in training. You will invest in supporting your partners. You will also invest in building a team to manage your partners. You may also choose to go with their momentum and invest in co-operative marketing with effective partners. Your own innovative approach will determine further investments.
How quickly will you start seeing a return? Your return can be far more immediate with a channel partner than it would be with a direct salesperson simply because partners start out selling to existing customers, not creating new ones (which is much more time-consuming and costly.) These are customers who already know the partners. Customers who trust them. Your investment in helping them identify which of their existing customers to approach first with your products and services is your best way of achieving as immediate a return as possible.
While that’s going on, it’s time to get proactive about helping them create new customers!
Applying the Sales Funnel to Channel ROI
Co-selling can be one of your most valuable partner engagement best practices. Investments in co-selling with your partners pay off in two important ways: Beyond the profit you drive from an early sale, you’re also providing in-vitro sales training as your channel partner’s salesperson learns from your own people. Whatever your sales process is, co-selling to existing customers of your new partner will shortcut a major portion of it.
Remember, existing customers are just a small portion of the universe. With co-selling, another portion opens up: the people that partners haven’t sold to. Here’s where your investments in helping them move through their sales process can pay off for both of you handsomely.
No matter what steps are in your sales process, they all sort out into four basic stages:
- Awareness – Anyone you’ve never sold to needs to be aware of you and your channel partner. Everyone needs to be made aware of every new offering you and your partners bring to market.
- Interest – Some customers may take the initiative to alert you to their interest in your products and/or services. Your channel partners need to be ready and able to respond to these inquiries. They also need to gauge interest that may exist with other potential customers.
- Decision – You and your channel partners develop the prospect’s interest, identifying needs and clearly demonstrating how your products and services fulfill them, all leading to encourage them to make a buying decision.
- Action – Time to ask for the sale. Upon approval the order is processed, and the transition to the delivery process begins.
Before you can begin this process, you and your partner must identify companies that may demonstrate interest if you make them aware. When you find them or are made aware of them, you have new leads. Your job is to transform those leads into opportunities that ultimately deliver pipeline value. Let’s explore each of these!
Leading Indicator #1: New leads
Simply put, you can’t create new customers and new sales without finding new customers. That begins with leads.
Smart partners are constantly finding and innovating new ways to identify new leads. There are more and more demand generation activities you can try to increase your volume of incoming leads, which you can then share with channel partners. Some of your partners may expect all leads to come from you. That’s a problem. You want partners who also do some demand generation of their own. Here are a few ways you can recommend for them to try:
- Referrals – Referrals continue to be the most effective form of marketing. Of course every salesperson should always be asking happy customers for referrals, but there are also some systematic ways to generate them. In your marketing materials, make it desirable to your readers to refer you to their associates. This may take the form of simple encouragement, or you may offer free services and other rewards in return for effective referrals. Turn your customers into your best representatives!
- Social Media – Many channel partners turn to social media for “inbound” marketing. Not only is this one means of communicating about your product, but social media can build up an engaged community of followers – who can then turn into loyal customers or serve as future referrals.
- Content Marketing – Customers no longer buy your products as much as they buy what they can do with your products. You can show what your products are capable of through intentional content marketing. Think of thought leadership blog posts; by taking a stand on topics within your industry, you can back up ## and frame it around your product. Smart partners show off the smarts of their consultants and engineers in the content they produce and circulate.
There are many other strategies available to help drive new companies to become leads for you. When you only have one partner in a given geography it’s easy to share those leads with them. But even with just one partner, you must track each lead to determine what was done with it. Think of yourself as handing your partner money. What did they do with it? You need to know.
Leading Indicator #2: Qualified opportunities
Effective partners treat your leads, or their own, like gold. They follow-up on them constantly, consistently, and with value, until they make contact with someone. When you hear “Oh, I left a voicemail,” and that’s all you hear, you may need to take your leads elsewhere. The right partners attack with multiple weapons from your armory. They send your collateral, they make calls, they send your case studies, they continue to work to connect via email, phone, whatever medium works.
Once your partner’s salesperson has reached someone, the real work begins. Fully qualifying a customer is necessary if you’re going to close a fully satisfying sale with them. Here’s where your training really begins to pay off. The salesperson needs to learn about the lead, their business, how they operate, whether or not they have a need for your product or service. Once they’ve identified the need, they should assure the lead has the budget, the time frame, and the desire to buy your products from your partner. The more they know about your products and services, the more effective they can be in matching them up with the needs they uncover.
Leading Indicator #3: Pipeline value
At this stage of the selling process, you need to define and quantify new opportunities.
Ultimately, to close a sale you must propose a sale. The proposal must match the need your partner has uncovered. It must be detailed, including every product, every service, and every other resource to address the needs of the prospect. It must be well differentiated from anything a competitor may propose. It must be priced competitively and tie the price and ongoing cost of operation to the value that will be generated.
As you and your partner plan to develop and present your proposal, it must also be added into the pipeline. Your pipeline tracking system will include customer name and contact information, the price for your proposal, and your estimation of the timing and the likelihood that you’ll close this business.
The next steps in your sales process will involve overcoming objections, answering questions, continuing to encourage the customer, inform the customer, and more. After every contact the pipeline must be updated to record any potential changes in the timeframe, next steps or likelihood of closing.
You’ll know you’ve built the relationship and earned the trust you want with this partner when they enthusiastically share and review their pipeline with you.
You then need to evaluate your estimations of their accuracy and update your own overall pipeline accordingly.
Leading Indicator #4: MDF usage
Welcome to Honesty Hour, or perhaps the Brutal Truth Moment.
Many channel reps complain about the inability of their partners to market effectively. In many cases they have nobody on staff with marketing skills, experience, or interest. Others simply don’t believe in marketing. That’s somewhat like a baker not believing in flour.
You want to invest your marketing development funds (MDF) wisely. Simply tying them to previous sales is backwards, putting sales before marketing. It may also put your funds into incompetent hands where they will simply be wasted or creatively routed to their bottom line.
Each channel partner must be individually evaluated. If they don’t have marketing acumen or resources, your best strategy is to connect them with a professional marketing services provider and fund that for them. You may offer them prepackaged marketing programs they can use your MDF to pay for.
When you find you have a partner with great marketing capabilities, go with their momentum. Invite them to propose marketing activities they feel will be most effective. Decide to what extent you’re willing to fund them. Perhaps you’ll match the partner’s own investment. Perhaps you’ll pay for the entire thing. Perhaps you’ll syndicate them with adjacent manufacturers.
MDF should not be simply a de facto requirement of a partner program. It should instead be among your primary channel strategies, much like prioritizing the development of engaged partners. When you show partners value, they respond with value. The value you show them is your investment. The value they show you is your return.