Every channel leader is looking to generate greater commitments from their business partners, resellers, and agents to invest in and grow their brand. The challenge most channel teams struggle with is to build a partner’s enthusiasm and energy behind a sales and growth strategy to build business.
The best place to start to achieve this goal is to understand the motivations and priorities of your partners. Ben Wightman, head of data strategy at Dentsu Aegis Network Asia Pacific, completed a study of partner motivations which are worth keeping in mind to build a partner commitment strategy.
10 Things resellers want from vendor programs (CRN March 2016 – Ben Wightman)
- More margin, more rebates
- More demand-generation support
- More sales support
- Better market differentiation
- Better communication
- More technical support
- Less program complexity
- More and better training
- Cross-sell, upsell and renewals support
- Joint annual go-to-market planning
There should be no surprises here, but it is important to work with your partners to demonstrate how each of their goals can be met. Number ten on the list above, joint annual go-to-market planning, is an excellent way to organize the partner engagement and commitment development. The problem is that most partner business planning processes are too time consuming, not integrated with data, and not very satisfactory for either partners or channel managers. Additionally, quarterly business reviews (QBRs) are labor intensive, inefficient, and rarely completed with most partners.
The New Model for Partner Business Planning and Commitment Development
You may be tempted to try and measure everything with your partners, and with good intentions.
After all, if you can’t measure it you can’t improve it (Peter Drucker), right? Beyond just closed-won revenue and your sales funnel you probably want to dig into key revenue drivers like lead generation, Market Development Fund (MDF) usage, account mapping, rep and SE training, goals, win rates, new customers, installed base refresh, cross-sell, service renewals, etc. etc.
However, your partners are busy, and you are just one of many vendors in their portfolio. They’re also sales people, so you’re taking their time away from selling – they need to see the value in the business planning process.
An ideal partner planning process serves the needs of you and the partner, allowing both of you to walk away with simple, achievable goals for the year, as well as a roadmap of how you are going to achieve those goals together.
Less is More
Align your partner’s goals with the critical goals of your business.
Less means your partner stays engaged and understands the plan. Start by developing a framework for a plan that can be summarized in a few bullet points. Your partner and your sales people are more likely to understand simple high-level goals vs. being in the weeds….
Example: Partner A
Goal: Grow revenue 20%
- Maintain a quarterly funnel of $10M
- Close 40 net new customers this year
- Get 5 SE’s certified on new solution by June 1
What do you need to know to support that simple plan?
Required Partner Planning Metrics
These are critical metrics to consider for gaining commitment from your partners to invest in your brand:
- Revenue and funnel history and goal
- Planning at the top line is fine if buying patterns at a more detailed level (product, solution) are uncertain
- New customers, existing customer upgrades and cross-sell
- Account planning: Track progress on current opportunities and plan to target new accounts
- Rebate attainment, incentive payouts, MDF and/or coop attained: Are there other monetary goals that motivate the partner?
Optional Partner Planning Metrics: Pick the best, delete the rest
- Market share: What is your share of the partner business?
- Allows you to know your growth potential (TAM)
- Are you financially important in their overall business today? (Don’t expect a partner to spend a lot of time on you vs. another brand that is 10x or 100x bigger)
- Leads & opportunities: How many leads did they bring you and how many did you bring them?
- Margin: If the partner will participate, this can be more important to them than revenue.
- Training: How many certified engineers does the partner have on staff?
- Not all vendors need this or have this program
- Less formal, ad hoc non-certification training may not need to be tracked in business planning
Start with top partners: The more significant the relationship the more your partners and your channel team is willing to invest in building a meaningful joint business plan.
- Key growth partners, keep it manageable for initial planning as well as check-ins and QBRs
- Frequent monthly reviews (or more) on current pipeline
- Monitor and reach out monthly on exceptions where goals are in danger of being missed
- Quarterly QBR to review goals and progress
- Make adjustment to quarterly pacing as needed
- Review account targets, progress, add new and delete targets
- Ensure quarterly changes still roll up to annual goal
- Identify unmet partner needs and act
- Collaborate on a plan to address unmet partner execution
Planning with reps instead of partner executives?
Some leading companies are setting business plans by not only by partner account but also by individual partner sales representative.
- Who are your key reps or evangelists?
- Focus on those that have a strong belief in your portfolio, understand a key vertical market/industry or know where to find a competitor’s customers
- Selling your portfolio makes them a significant amount of money
Keeping it simple is even more important at the rep level
- Select 1-3 metrics to manage
- Less info collected allows for planning with more reps
- Design with the intent that planning will be done over the phone
- Tools that your reps and partner reps can access daily to see their progress
- Top priority for the partner rep: How much can I make?
- Second priority: How much will my employer make?
- Reps are generally paid 15%-30% of the partner margin
- Show how much they can make selling your portfolio based on expected margin plus additional incentives (SPIFs)
- Spend MDF with them to help them achieve their goals
Partners are in favor of doing joint partner business planning because they understand that this is a commitment to each other’s success. Partners want to do plans that will be measured and reported throughout the year. This is all true if it is simple, requires little to no work to prepare, and provides updates based on progress throughout the year. Partner business planning, done simply and effectively, will generate higher growth partners, more committed to your brand and help you achieve your annual sales targets.