I plead guilty to enjoying a cold beer or two, and I’ve watched with amazement as the decade-long bull market in the craft beer industry shows no signs of abating.
When you think about the word “partner” in your channel sales strategy, you may not necessarily conjure up images of close-knit teams like Bonnie and Clyde, Butch Cassidy and the Sundance Kid, or any of the Ocean’s Eleven gang. Businesses recognize that partnerships are important, but there are a few key reasons they often get neglected.
First, when channel partners account for, say, only 5 to 10 percent of revenue, investing time and resources into giving the proper attention to channels may not be a high priority. Additionally, since partner channels are outside a company’s jurisdiction and have more freedom to sell or not sell, suggest or not suggest a product, it is much harder for the parent company to actively drive sales or even keep track of sales activity within the partner organization.
But if your channel partners aren’t a priority, you are missing a great opportunity to build revenue. If just 10 percent of revenue for a $1 billion company comes from channels, it still amounts to $100 million dollars. Imagine if that same company made time to educate, fund and improve the channel relationship? The results could easily outweigh the upfront time and resource investment to get the channel operating optimally.
Spending the time conceptualizing what you hope to gain as you enter into a partnership and then putting the pieces in place to get the partnership off on the right foot will help you hedge your bets for creating a fruitful channel. If you already have a less-than-productive partnership in place, step back and think about what it would take to obtain better results
Here are four steps for improving channel sales results:
Invest time and resources.
Don’t forget that forging partnerships is supposed to expose you to new markets and new customer bases, often in areas that are difficult to cover due to resource or geography constraints. Growing companies, in particular, can leverage partner relationships from the beginning by training their channels on the product, messaging, brand promises and the company’s specific sales process, all the while keeping in mind this shouldn’t be a “one-off” interaction. As your company’s sales methods, product offerings and messages change, be sure to keep your channels in the loop and continue to provide training when necessary to ensure that the right information is being disseminated and also to remain top of mind as channels create deals or look to appease the needs of their customers.
Additionally, be sure to demonstrate thoroughly your continuing relevance in the market so that partners feel comfortable “pitching” you to customers who would like market insight into your company financials or health, customer base, analyst opinions and differentiators.
Have a good answer to, “What’s in it for me?”
Ultimately, determining and dedicating channel managers is essential. These managers should be compensated much like your sales teams to help drive new revenues and enable the channel to succeed. Effective channel partnerships typically enable revenue share, and partner sales reps should be able to identify right away what their cut will be for selling your products. By including some incentive to keep your products top of mind in sales, your channels will pay more attention to the partnership and ideally recommend and sell more on your behalf.
Make it easy to sell your products.
For companies with particularly complex sales processes, providing the typical collateral, messaging, and demos may not be enough for your partners to sell effectively. If your company uses (or is considering purchasing) sales software such as customer relationship management (CRM) or configure-price-quote (CPQ) internally, extend use of that software to your channels. This way, all channels are on the same page as far as what can feasibly be configured, quoted and sold by whom and to which customers, and you enforce sales best practices inside and outside of your four walls.
Think about the end destination – the customer.
Channels work when the company, the partner and, most importantly, the customer get a win. To facilitate a positive customer experience, even indirectly, be sure that your partners are aligning with the way you know your customers like to buy. Partners should be able to speak directly to their needs, be able to explain the system benefits to the specific customer and their industry, and be the “face” of your company, building trust and positive rapport with potential customers.
Naturally, your primary focus should always be investing time in your own sales force. But for your channels, a little TLC can go a long way.
Mike Mothersbaugh is Executive Vice President of Worldwide Sales at Selectica, a company that provides CPQ and contract lifecycle management solutions to help companies sell complex deals with ease. His experience includes more than 20 years of sales leadership within the CRM, cloud computing, and CPQ industry, particularly in communicating value to enterprise-level organizations looking to maximize revenue within the quote-to-cash business process.