Attracting the right Channel Partners to your Business Comes Down to How Well you Executed your Recruitment Strategy
When smart manufacturers look to recruit profitable channel partners, they look for companies that don’t sit around and wait for deals, but rather, engage with their vendor and get behind their brand (e.g., seek training opportunities, take advantage of Co-op/MDF offered incentives, report POS/inventory data to facilitate stronger channel insight and market trends, etc.). If you’re a manufacturer that wants to transform inactive channel partners, into productive channel partners the method you use needs to be best-in-class. In order to attract, engage and recruit profitable channel partners, you must not only demonstrate your obligation to their success but also:
- Develop a clear, profitable business strategy
- Highlight your authoritative position in the market
- Detail the process of:
Who Wins in this Dog-Eat-Dog World?
If you want to replace underperformers with top dogs, you must first understand that the days of the best partners findings are obsolete. In today’s channel-intensive culture, finding the right solution providers (who actively sells your offering) comes down to the question of “how disruptive is your recruitment campaign?”
In the past, channel partners had to work to earn the attention and validation as a solutions provider to manufacturers. Nowadays, the game has turned in replace of a “partner’s market,” as manufacturers now must justify their product as profitable, and their services and level-of-support as best-in-class.
Going from “potential candidate” to “active partner” mandates a strategy synonymous with a sales campaign; in order to attract and recruit profitable channel partners, you need to go through a similar process through the various stages of the prospect buying cycle.
Here is a short, comprehensive checklist you can use to make your offering attractive to prospective partners:
|Value Proposition||Justify Opportunity||Loyalty & Commitment||Business Development||Profile Match|
|Product roadmap||Total cost ownership (TCO) & return on investment (ROI) calculations||Demonstrate channel sales % versus selling direct||C-level support and communication||Ideals and business ethics align|
|Market Advantage/edge||Whitepapers, case studies, accolades, testimonials, etc.||Objective deal registration participation parameters||Partner portal / easily find information on incentive opportunities||Does partner take the time to “recruit” you?|
|Transformation /long-term benefits of partnership||Pricing made easy||How is channel conflict managed?||Training, consolation, go-to-market strategy, co-branded marketing material||Solutions /services align with your product|
|Authoritative position/industry influence||Distributor/ reseller references||Marketing funds and cooperative ad incentives||When can partners expect to be reimbursed (i.e., turnaround) on incentives||Strategic partnership|
|Market reputation||End-user references||Attractive rebates and SPIFF opportunities /tired programs||When can partners expect information on data disputes or questions to be answered?||Agreement on what constitutes success|
How to Create a Compelling Value Proposition when you Are Looking for Profitable Channel Partners?
Manufacturers have to be savvy and forward-thinking when positioning their company against competing key players. Any well-executed partner recruitment campaign will be reliant on differentiation, and the more objective manufacturers can illustrate this core concept, the stronger their value proposition will be.
Help clarify your differentiation to potential partners by creating a visual representation of some key elements that separate you from the competition (see figure 1).
Profitable channel partners look for a winning combination, where they can augment their unique value as a solutions provider with that of their manufacturer.
Additionally, the more articulate manufacturers can get about ‘where the market is going,’ ‘what are the key drivers behind the market,’ and ‘what are the obstacles that stand in the way,’ the more relevant and valuable they become to channel partners. However, all of that is irrelevant if you can’t clearly communicate your value proposition and the competitive advantages you are poised to provide.
Justify Partners’ Decision to Invest in your Product
Channel partners’ decision to invest in a manufacturer takes a straightforward approach. It’s a simple however complex question that boils down to, “Can I make money with this company and product?” The ‘invest, wait and see’ methodology is not something preferred amongst channel partners, and it’s a manufacturer’s responsibility to justify their investment before a dollar is spent.
Manufacturers that have readily available sales tools (e.g., TCO, ROI calculators) to help close deals, settle objections and illustrate the after-purchase transformation can get partners excited to sell their product. Because channel partners are in the trenches of end-user hesitancy to purchase, they understand the value and advantage these tools present.
Furthermore, case studies that describe what a manufacturer’s product did versus what it can do, are essential resources that partners will frequently rely on their decision-making.
It’s also unlikely your (potential) partners are new to the game of working with manufacturers. Therefore, they will be cognizant of your dependence on the channel. Articulating that channel revenue is essential to your net profit—and direct sales represent only a fraction of gross sales—is also an attractive recruitment tactic (see figure 2).
Recruit Profitable Channel Partners by Implementing Well-Defined Incentive Programs
If you want to Recruit profitable channel partners to sell your offering, engage in your incentive programs, and special pricing agreements have to be best-in-class. Channel partners have seen A LOT of promotions and incentive opportunities, so it is your job to not only make sure these programs are profitable, but also cognizant of partners’ objectives, roadblocks, and specific business needs.
Even the best (potential) partnerships will fail if your channel incentive programs don’t live up to their expectations. That’s why it’s imperative to view your channel programs from abroad, a 360-degree perspective that considers each and every aspect that may lead to inadequate ROI.
Why your channel incentive programs fail to produce an adequate ROI for you and channel partners:
There have been many prosperous channel partnerships only to be tanked by poorly implemented channel incentive programs. It’s critical that program implementation takes on a comprehensive, methodical approach that leaves no room for question or mystery.
How to Improve Channel Incentive ROI for you and Channel Partners:
Manufacturers that are in tune with the competitive and fragile nature when trying to recruit profitable channel partners realize the importance of well-defined programs. Channel partners are experts in their respective industries and functional segments. The responsibility falls on the manufacturer to enable partners with the appropriate incentives so that they can capitalize on their efforts. Confusing program parameters and cumbersome qualification processes defeat the purpose of this essential ideology.
Ultimately, successful recruitment and long-term channel partnerships stem from a mutual understanding of trust. Partners will be more than ready to invest in your business if they can be convinced you are committed to their success—and have the necessary justification to prove it. The more transparency runs through your communication and policies, the more confident partners will be to help generate revenue.