4 Easy Steps to Channel Development
It is important to periodically assess your channel partners in order to maximize company sales potential. Following is a straightforward approach for channel development. Follow these steps to identify viable partners, determine their potential, and develop them into productive sales resources.
Step 1: Pithy Messaging
Engage in self-reflection to derive your unique customer value, competitive differentiation, partner value proposition, and partner ecosystem affiliation.
Unique customer value: why do customers buy your products? The intent is to summarize the customer value proposition. If you aren’t effectively selling direct, you probably aren’t ready to scale through partners. Don’t get too detailed at this point – we’ll save the detailed product demo for later in the partner onboarding process.
Competitive differentiation: how is your product unique or notable? Consider industry awards, analyst coverage, or something as simple as longevity or number of installations. The objective is to demonstrate you have a unique, stable position in the industry and are a safe bet for partners to work with.
Partner value: why would a partner want to invest the time and resources to work with you? Reference value-added services, reseller fees, and referral fees (as appropriate). Be able to talk to the typical project in terms of software versus services and any strategic client relationships it opens up for the channel partner.
Partner ecosystem context: how are you supported by larger partners? If you are affiliated with a platform partner (e.g., Microsoft, VMware, etc.), identify the joint marketing and sales support you get from that partner and how it helps your channel partner relationships.
End Result of Step 1: a few reference slides that you can use for a “first contact” partner recruiting call.
Step 2: Target Partner Analysis
Evaluate your existing partners to see what keywords they use to describe their solution (tip: use LinkedIn company profiles). Also assess your top competitors’ partners to determine if you’re missing any key scenarios (this also helps avoid engaging companies already aligned with competitors).
Consider the geographies you’d prefer to source partners. The best markets areas are those where you have gaps in direct sales coverage but can provide regional partner support.
You may prefer to engage companies of a particular size (large enough to have an impact but not so large as to be bureaucratic). If you have an industry specialty (or want to jump to an adjacent industry), factor that also into your criteria. If working in context of a platform partner ecosystem, leverage their certifications/competency ratings to qualify partners’ technology expertise.
Use these criteria to conduct research using LinkedIn, partner ecosystem directories, and individual web sites. Develop a score and a weight for each of these factors so you can derive a net partner ranking.
End result of Step 2: a spreadsheet of high-value partners, ranked by your key criteria.
Step 3: Partner Recruiting
At this point you’ve likely decided there are enough interesting partners in the partner analysis to warrant testing their interest for partnership. To proceed you need to identify appropriate contacts at those organizations. Contact databases, websites, LinkedIn, and your prior connections can help to derive these contacts. If you identify the appropriate stakeholder in LinkedIn, you can always send an email to the main company inbox, asking for a connection.
Schedule a short call to test for mutual partnership interest. In these first-contact calls (using your pithy messaging from above), inquire about their target customer segment, number of engagements, industry expertise, and other info that would help you determine whether that company would be a good partner match. Ideally you can identify a common customer context (although this may not pop until later in the relationship).
Determine whether they resell other software solutions. Perhaps a referral fee would be appropriate if they aren’t accustomed to reselling software solutions.
End result of Step 3: understand whether each partner is a good fit and their willingness to work together toward a customer pilot. Schedule a product demo as the next onboarding step.
Step 4: Joint Business Development
As confidence in your partner’s implementation capability (and their confidence in recommending your product to clients) grows, start collaborating on marketing leads. These are leads not actively engaged by your direct sales force, but still represent client interest (e.g., inbound website leads, leads from industry events and webcasts). Do not try to set up any formal partner relationship until you’ve tested customer interest together and gotten 1-2 joint projects under your belt.
Most companies expend a burst of energy around partner recruitment but often find partners’ value dwindle to website fodder over time. Maintain partner marketing and business development support to keep partners productive (including after formalizing the partnership).
End result of Step 4: increased revenue through productive partners who can sell on their own as well as accelerate deals you otherwise wouldn’t be able to advance through your direct sales force.
It isn’t rocket science, just an analytical approach to identifying the right partners, engaging them with the right message, and delivering the right business development support to sustain increasing sales results.
Contact us to initiate your own target partner analysis and discover your channel partner potential!