One of the fastest ways to expand enterprise sales is by enlisting help from channel partners, but to be effective, you also need a partner relationship management strategy. To make your channel partners effective, you have to provide the tools and support they need for success.
With the right resources, your channel partners can transform your sales and marketing efforts. CSO Insights reports 63.5 percent of companies said channel partners contributed to their annual revenue. The study shows that 19.3 percent of companies attribute more than 90 percent of their revenue to channel sales, 8.3 percent report 75 to 90 percent revenue from the channel, and 6.4 percent report 61 to 75 percent of revenue from the channel, and 7.3 percent say they attribute 41 to 60 percent to the channel. Altogether, that translates to 41.3 percent of companies surveyed relying on channel partners for 40 percent or more of their annual revenue
Aberdeen estimates one-third of businesses use some form of a sales channel, but only some of those businesses have an effective partner relationship management program. Of those companies that have best-in-class channel relations see 28 percent shorter sales cycles, 13 percent more reps achieving quota, and 12 percent higher conversion rates.
Understanding Partner Relationship Management
To understand what channel relationship management is all about, let’s start with an understanding of the scope of partner relationship management. As defined by Forrester, partner relationship management “connects the dots between partner planning, recruitment, onboarding, enablement, incentives, co-selling, co-marketing, and management.”
What this means is creating a program, powered by technology, that empowers your channel partners so you can focus on high-value customers. Your channel partners should be responsible for building second-tier markets by targeting companies that normally are not on your radar. They also need to have the resources to do their job without a lot of hand-holding.
As with any type of business activity, people tend to gravitate toward frictionless processes; the easier you can make your channel partners’ job, the better the results will be. When developing your partner relationship management program, your objective should be to improve communications, simplify business processes, and do everything you can to promote partner success.
What It Takes to Have Frictionless Partner Relationships
1. Know your channel partners
Before you can support your channel partners, you need to know their strengths and weaknesses. Start by learning more about their operations, including how they represent their clients and how they differentiate themselves in the various markets they sell into.You need to understand what drives their business before you can determine how your products or services fit (e.g., is your solution a primary offering or an add-on?). Also, you should learn more about their workflow and internal business processes. This is all part of aligning your mutual business goals.
2. Streamline lead management
Technology can help you optimize lead tracking and nurturing to cut down on forecast calls and partner support. Create visibility into every aspect of lead management. Make it easier to share information about customer requirements, contract terms, onboarding, dependencies on other platforms or vendors, pricing, and so on. The goal is to make it easier to collaborate on sales activities and customer support.
3. Manage the channel by the numbers
In any channel partner strategy, quality wins over quantity. While it may be tempting to add as many channel partners as you can to create the widest market coverage, this approach will lead to overdistribution, channel conflicts, contractual disputes, and other headaches. It also will result in unhappy and unproductive partners. Take the time to calculate how you need to structure your channel strategy to reach your sales goals. How many products do you need to put into the channel? How many transacting partners will you need to reach your quota? Once you do the math, you likely will find you need only a handful of solid partners. Also, monitor partner performance and eliminate underperformers that aren’t paying their way.
4. Provide comprehensive onboarding
Be sure your channel partners have all the training and information they need to be successful. Establish well-defined rules of engagement. Create a repository of training videos, data sheets, manuals, and support material. Be sure to have a program in place for new product orientation, including go-to-market strategies and support training. Also, provide training in competitive positioning, including market differentiators, competitive sales pitches, pricing, and so on. If possible, offer product certifications and incentives for achieving training milestones. Personalizing the training experience will improve results.
5. Apply data-driven decision-making
False assumptions can be costly, so you want to be sure decision-making is based on concrete data. Partner relationship management technology can not only help you track channel activity but also give you and your partners the data needed to make intelligent business decisions, such as:
- Tracking opportunities in the channel to give you more accurate forecasts
- Archived transcripts of customer interactions to provide a history of the customer and what steps were taken in identifying the problem resolution
- Performance metrics to tell you and your partners how they are performing against short-term quotas and long-range goals
- Real-time reporting to show you what’s working and what isn’t in terms of lead nurturing, content support, and other factors
- Capturing idea submissions that can improve marketing and sales initiatives
Ultimately, your channel partners are successful only if you provide the right infrastructure and support. Partner relationship management is a collaborative process, and the more support you can give to your channel partners, the more successful they will be.