A Sirius Decisions report states that in order to help drive demand generation, channel organizations spend between 35-54% of channel marketing budgets on programs for their partners. Of these programs, 80-90% are funded through proposal-based Market Development Funds (MDFs).
For more than two decades, Computer Market Research has helped vendors manage the disbursement of their MDFs and Co-op advertising dollars. Vendors have always been concerned with the ways in which their funds are being spent. They need to make sure that their channel partners are spending funds on activities that help drive demand or increase revenue.
While web-based Co-op and MDF solutions have helped vendors accomplish this, their channel partners (resellers, retailers, and distributors) are still left with the burdensome task of tracking all of their funds individually. Inevitably, many of them have no idea how much is actually being made available to them, nor which funds are expiring. Things become increasingly difficult with more and more vendors in the picture.
On one particular occasion, we spoke with a large retailer in the home improvement industry. This retailer received Co-op dollars and MDF from over 500 vendors, and guess what?
They were managing these funds on over 500 separate Microsoft Excel spreadsheets.
In another case, we met with an industrial distributor that was eligible to earn funds from more than 300 different vendors. They admitted that they were only actively receiving funds from about 10.
It turns out, many channel partners have similar stories. Maintaining a separate spreadsheet per vendor has been the status quo when it comes to tracking MDF and Co-op Dollars. Consequentially, most partners are leaving large sums of money on the table because they don’t want to deal with the amount of time it takes to manage and obtain funds from each of their vendors.
This led us to realize that partners themselves need an effective way to manage funds from multiple vendors. So, we designed a SaaS tool to do just that.
Simply put, the tool was designed by turning our traditional Co-op/MDF Management solution “upside down”, then making adjustments to many of the back-end rules. By doing this, channel partners now have access to a centralized database that enables widespread visibility, easier tracking, and efficient processes for submitting documentation.
Therefore, what is Multi-Vendor Co-op/MDF Management? It’s the practice of actively managing marketing funds that come from multiple vendors. The best part is, there’s an efficient way to do it now.