Research from SiriusDecisions indicates that average partner program adoption averages 40%, but can be as low as 20%. Although recent research points to a need for deeper partner analysis, vendors are also faced with the obstacle of encouraging partner participation in reporting sales and marketing progress.
“The key concept is whenever you ask for something, you have to be ready to give something in return, especially in the form of value,” Laz Gonzalez, Service Director of Channel Management Strategies for SiriusDecisions, told Channel Marketer Report. To encourage implementation, Gonzalez recommends that vendors provide partners with three key incentives: business, margin and revenue. In an effort to increase participation in deal registration programs, vendors also are implementing incentive programs.
“If suppliers want to get better visibility into your deal registration system, you have to consider a mix of partner senses,” Gonzalez added. “Vendors typically encourage partner participation in deal registration by giving margin. So, for example if you register a deal and you close that business, you gain more margin than if you don’t register a deal and close the business. That today is a well practiced policy, but the reality is that at the end of the day, when that partner shows up with that deal, if he has any leverage, he can negotiate his margin.”
Deal registration modules allow vendors to better track VAR and partner initiatives and keep channel sales reps up-to-date on activities. These solutions can be integrated directly into customer relationship management (CRM) and partner relationship management (PRM) platforms. Once registered, partners can tap and access information directly. While there are multiple PRM vendors in the channel space, CRM vendors such as Salesforce.com, Oracle and SAP provide PRM modules within their platforms.
Although vendors are eager to obtain end-to-end visibility of channel operations and sales and marketing progress, companies should focus on the success of individual campaigns, according to Gonzalez. “Let’s try to address the issue one campaign at a time,” he said. “Vendors should focus on some key metrics such as marketing’s contribution to the pipeline or marketing’s influence to the pipeline.”
To better address these needs, best-in-class vendors are implementing a new set of metrics, such as “marketing contribution to pipeline” and “influence” to better illustrate the overall impact of marketing and sales efforts. By implementing performance-based metrics including general cost-per-lead and average close ratio to analyze program progress and results, vendors can implement more efficient, cost-friendly partnerships. Similarly, partners can develop more strategic deals regarding which accounts to pursue.
In an effort to better understand “which lever to pull” in channel operations, executives are adopting CRM and PRM solutions to efficiently track opportunities and overall lead nurturing efforts. Executives also are integrating these solutions with marketing automation platforms (MAPs) to gain insight into the return on partner-led demand gen programs.
The average channel partner currently manages 6 or 7 partnerships, and 1 or 2 key relationships, according to research from SiriusDecisions. Implementing third-party solutions that offer services such as point-of-sale reporting allows vendors to better track program performance. Regular reporting also provides visibility into which programs are yielding the best results and which partners are performing best.
In part 2 of the Channel Marketer Report feature, Laz Gonzalez will share key insights on optimizing MDF funds and the impact of social media in channel marketing initiatives.