Empowering Your Channel Partners: It’s All About Marketing Alignment

January 17, 2019

Channel partners are an important source of revenue for many software companies. SAS has the goal of getting 50 percent of mid-market revenue from its channel partners; for some vendors their contribution from channel partners is even higher.

At the same time, the challenges of managing a successful channel partner program are many and legendary. These can include:

      • Channel conflict with the company’s inside and field sales teams
      • Training channel partners and keeping them up to date on the latest enhancements to the software
      • Creating and managing an effective compensation structure to incent the partners and their salespeople
      • Maintaining mindshare with the channel partner salesforce so they actually sell the solution (this can be especially challenging for software startups)
      • Managing or eliminating underperforming partners
      • And many more

But it’s rarely discussed that channel partners are often very poor at marketing and lead generation. They don’t generate nearly as much revenue as they could. This is especially true for the channel partners of companies selling non-marketing software such as software engineering tools, business process management, fintech, databases, endpoint management, supply chain management and more (the partners of MarTech companies are often marketing agencies that are adept at marketing).

Companies that market more grow faster. When I studied the marketing programs of hundreds of B2B companies with 50-1000 employees, I found a huge discrepancy between software companies and everyone else. While software companies are using a median of 7 of the 9 digital marketing programs that I scored companies on, non-software companies – including professional services firms like many channel partners – are using a median of only 3 of the 9. And this matters: software companies with the most robust programs were growing about five times faster than those that were doing little marketing.

Often software companies that have robust, mature marketing programs themselves are being under-served by channel partners that do little marketing, and this slows the growth of the software vendor.

How to empower your channel partners

It’s not unusual for companies to offer programs to help their channel partners. CPG companies invest in co-op marketing programs with retailers. Many software companies offer programs like sales and enablement training to their channel partners. But there are few companies that help their partners improve their marketing. This is a significant opportunity.

Software vendors need to:

      • Educate channel partners on the importance of marketing, how they themselves use it to drive growth, and how channel partners can use it to generate more leads and sales for themselves and the software vendor
      • Provide channel partners with marketing insights into customers and why they buy

But education isn’t enough. The channel partners who have little experience in marketing will also need help developing and implementing their marketing strategies and action plans, as well as adding the needed personnel, marketing software and third-party data. Since the software vendors are busy with their own marketing, some channel partners may need consultants or an agency to act as a virtual marketing department to ramp up a new marketing program, with the goal of helping the partner staff up and transfer management of the program to an internal team over six to twelve months.

With dozens of marketing channels, and the noise generated by thousands of MarTech vendors, many channel partners are overwhelmed by the marketing landscape and wouldn’t know where to start even if they were inclined to. In another recent post, I described that a number of marketing approaches that get a lot of attention, such as inbound marketing and organic social media, have actually passed their peak. Companies that don’t already have robust results from those marketing channels will find it hard and slow to produce them. I also described a way for companies new to marketing to produce results relatively quickly and inexpensively.

Software vendor support for the marketing of their channel partners isn’t going to be a silver bullet that produces new results overnight. All experienced marketers know that consistent, repeated execution is central to success. But by empowering their channel partners with superior marketing knowledge and resources, software companies can significantly grow their revenue from that channel.

President<br>Revenue & Associates

Louis Gudema is the President of Revenue & Associates. He mentors startups at MIT and is the author of Bullseye Marketing, which is available on Amazon. <a href=""></a>