Start by providing the right carrots and minimizing the sticks.

By “sticks” I mean the obstacles to registering deals. How easy is your deal registration process? Do partners have to guess what your deal registration form is requesting? The faster they can satisfy your requirements, get in and get out, the more likely they are to bother with it – and to feed you good data. Streamline the process by requiring only the essential info and ensuring your deal registration form is glitch-free.

And don’t forget about the carrots. Create the right incentives and disincentives as appropriate, for example:

• “Your deal is not protected if it’s not registered”
• “Get extra points for registering”
• “Approved deal registration = better discounts”

Communicate those carrots clearly, thoroughly and regularly.

You won’t find any VARs who like registering deals, but they do recognize the value. You can further reinforce that value for them by making sure the system feeds back their information clearly and accurately.

Be disciplined in your use of the carrots and sticks.

Vendors also have to be consistent with the deal registration rules and process. Deal registration by the partner has to be a non-negotiable requirement. If you’ve ever told a partner, “Oh, I know what you’re doing…I’ll just register it for you,” then you’re supporting partners in generating incomplete channel visibility. You have to require it, and you have to make sure you don’t help partners to not register their deals.

Increasing deal registration ultimately boils down to establishing relatively few rules, making sure those rules are easily understood, and that they’re applied consistently. If you set it up correctly, the obstacles to registering will be minimal and the rewards will be worth it.

Lets face it: The reason you build a reseller channel is to accelerate your company’s sales ten times faster than you could by building a direct sales force. Historically, Partner Relationship Management has focused on providing static marketing materials, funds for marketing campaigns, and distribution of leads generated by the vendors’ marketing efforts.

But it could be doing a lot more for your company – why not get an added benefit from your indirect sales channel by generating inbound leads based on common keywords?

As the vendor, you want to dominate at a national or global level while your channel partners want to dominate at the local level. By working together with a coordinated SEM/SEO strategy, you can both benefit from joint SEO efforts. Here’s how you do it:

1. Use a website grader on your partners’ sites and post the results in your partner portal.

This allows your partners to see how well they are positioned for organic search and what areas they can improve on their sites to accelerate their inbound leads for your products. Hubspot has a good tool, but there are others available as well.
2. Provide partners keyword rich content that’s optimized for your products.

Create guidelines for content creation that will contain keywords that you know convert well for your products while providing them ample opportunity to include geographically specific keywords for their area.  This will help you capitalize on local search without creating specific campaigns or landing pages by region. You might even want to allocate some Market Development Funds (MDF) to your partners to help them create the keyword-rich and product relevant content. Used this way, your MDF will have much higher returns than traditional MDF expenditures.

Offer this content via an online resource library, and be sure to have different types of content available for different social media purposes (blogs, LinkedIn, Twitter, Facebook).

3. Define a social media strategy for partners.

Most partners have not yet discovered the impact of using social media effectively for inbound lead generation. By being the first to teach them and making it easy to roll out, you can help them focus on promoting your products.  If you are providing them the content outlined in step 2, be sure they understand the importance of promoting themselves (and your products) via the most popular social media websites.

4. Coordinate a backlink strategy between you and your partners.

We all know that backlinks from relevant and trusted sites are a key driver of SEO. What’s more relevant and trusted than your partner network?  Provide your partners with your logo and a short and long version of your product and/or company overview so they can pull that information from your resource library and easily post it on their site.  Eliminate the work for them.

5. Provide tools for success.

Don’t spend your MDF dollars giving partners fish. Instead, use those funds to teach them to fish for you. Working with your most valued partners via an inbound marketing platform is the best MDF investment you can make.

Providing all of these tools and working with your partners to generate mutually beneficial traffic also serves to create loyalty between your partner network and you.

One key to success is always fine-tuning your channel program to make it more efficient and simpler to work with for your internal sales team and partners. Efficiency and simplification leads not only to improved efficiency and productivity for partners and staff, it makes partners really want to sell your product.

1. Make sure your system ties together

Sales managers and channel managers should all have access to and work from the same information. Having a single source of truth helps prevent time draining discrepancies and reconciliations. Your partners should have access to all of that same information as well (as appropriate to their relationship with your company).

Having a centralized system also helps avoid the inefficiencies (and black eyes) that come when two different sales people approach the same target.

2. Automate communication about market development funds (MDF) from request up to reimbursement

That centralized system should also allow you to automate MDF communication. Nothing de-motivates partners like an MDF black hole. A system that ties into your PRM software and notifies partners at appropriate milestones where their reimbursement stands helps everyone work together more smoothly and jointly realize more success.

Unfortunately, for almost any industry, most MDF in the channel go unused, with negative repercussions on the overall channel sales program. When vendors aren’t utilizing those funds, it usually means they’re not talking much about your product.

3. Integrate with Salesforce, Sugar, Microsoft Dynamics, Zoho, or other CRMs

PRM software, of course, is key in creating a system that connects all lines of your business intelligence, and when you integrate your partner relationship management solutions with a CRM tool like Salesforce.com, the efficiency benefits accrue exponentially.

Merging PRM with a CRM system allows you to manage customers and partners from one place, providing visibility into the entire pipeline for both your direct and indirect sales channels.  Channeltivity is already integrated with major CRMs and can easily connect your into yours, offering single sign on functionality for a single view into all of your account activity.

Everyone thinks their indirect sales program is different, that wild success is inevitable—just get some partners and launch. But the fact is, unless you have a corresponding expense department to fund your channel growth strategy, it’s just a magical illusion.

Illusions can be fun, but let’s look at reality: Channel sales are an area where revenue growth will only happen with the appropriate investment, both human and capital. The good news is, once you know that, you’re that much closer to operating a successful indirect sales channel.

Channel Champion

Make that investment first of all in the best person you can find to run the channel. The problem with tacking the responsibilities on to your sales or marketing VP’s list is that the channel won’t get the attention it needs. If your channel is ever going to experience big growth, it needs someone to champion its success, to know what’s working, understand what’s not—and to tweak, revise or redo the program as appropriate, on a regular basis.  Refer to our recent blog post on hiring the right channel manager for more information on how to structure your channel organization and what to look for in a candidate.

Plot a Clear Course For Where You Want Your Channel To Go

Invest the time to write a detailed plan and to engineer the processes as early as possible. Spell out your objectives, define measurable sales and partner recruitment goals, and determine how you’ll collect actionable information on results so you can guide future improvements. Map the process of recruiting, enabling and engaging your partners.

Automate Your Processes

Huge pieces of your indirect sales channel process, if they’re clearly articulated and plotted, can be handled by clerical-level staff—if you have the right tools.

Spreadsheets and email can seem like the way to go when you’re just getting off the ground and your partners are few and their sales are low. The problem is, right when you begin to see a ramp up and growth, these archaic methods of attempting to manage your channel will hobble your efforts. They’re just too labor-intensive.

On the other hand, a solid partner relationship management program is a good example of how spending money can save money and improve your results. It should include an easy-to-read, partner dashboard you can read in real-time to foster the best management decisions. Implement a PRM early on, and you’ll have a foundation for scaling your channel program quickly and taking full advantage of future market growth opportunities.  Channeltivity offers scalable, modular solutions so you can customize your initial needs and easily expand upon them as your channel grows without an extra integration.

Let’s say you’re a VP of Sales and Marketing, and your CEO has asked you to come up with a list of your company’s top go-to-market partners within your indirect sales channel. How would you go about it?

You can do it old-school: pick up the phone, set up an Excel spreadsheet to keep track of what you learn, and start filling in the cells. Seems logical, right?

Yes, it probably was logical—in 1998. But in 2012, this approach is time-consuming, labor intensive and unreliable. Not to mention antiquated. One of the many advantages of living in the information age is that we have partner relationship management software, which creates super-easy access to data that empowers better decisions. In five minutes, you can run a report that shows your top-performing partners.

PRM software is not just more efficient—it’s much more accurate. The problem with relying solely on a manager or other human to make a determination about partner performance is gut feeling. Because, unfortunately, sometimes our guts are just wrong. We humans are very impressionable. We’re easily swayed by the shiny object effect.

Someone who’s just closed a big deal will probably be the first partner who comes to mind, but if you look over a longer time period, what do his numbers show? How many new total deals has the partner registered this year? What’s his registered-to-closed ratio? What’s his utilization rate for co-op or marketing development fund (MDF) spending? How long does it take on average for him to close deals?

The other problem with gut feeling is that your CEO probably doesn’t want to hear this is the reason these partners are on your list.  Having accurate, reliable data, in real-time, to back-up assertions always improves your credibility and professionalism.

Next time you want to know how your partners are performing, check your PRM program first. You will be able to get the data you need to make the right decision and put together a compelling, stand-out report in just a few minutes.

Joint planning keeps your partnerships from going dormant.

Vendors usually start out well with their new partners: They have agreements, they have the portal in place, they have their deal registration, they have great discounts.

Things are moving along beautifully for the first 30, 60 or 90 days. They probably have some type of a ramp-up plan—but then what?

The partnership falls into limbo after those exciting kick-off months. Sales reps always go for the next shiny object (i.e., a different vendor’s product), so you’ve got to keep them engaged.  A joint and mutually beneficial business plan is key to doing that.

Your ability to keep the plan front-of-mind contributes to channel success, too.

The plan shouldn’t die a slow death on the partner manager’s hard drive. It needs to be a living document that vendor and partner refer to regularly.

The beauty of having a portal like Channeltivity is that the joint business plan can be configured so either side can create, edit, or read it. You can make sure it’s in front of partners every time they log on. They can refer back to it easily, and see how they’re progressing against goals.

This makes quarterly reviews easier, too. Maybe we agreed to a quarterly goal of $25,000 and we can see we’re only at $15,000. This gets everybody focused on how to close that gap.

And the good news is that the planning process doesn’t have to be hard.

You never know the skill level of the people engaging with your partners or partner organizations, and planning can be a daunting task.

Channeltivity’s solution makes planning as easy as completing a form, and that takes all the stress out of it—which means it’s more likely to get done.

Why not just get the program rolling without a PRM software solution? If the program works, then we’ll invest in it.

The short answer is that incomplete commitment results in a predictable outcome: failure.

Having a PRM software solution in place makes your program real in the eyes of your prospective partners. It helps you recruit the best because they will see that you have thought through what will make your channel sales successful. It shows you’ve made a commitment to the program beyond your PowerPoint slides.

If you are successful in getting partners to sign up but have no systems in place for enablement or engagement, your time will become dominated by your first ten partners, which will take a toll on your overall recruitment efforts. In short, you’ll plateau and further growth will come at a much higher cost. Odds are you won’t hit the critical mass necessary to justify the program.

Why do I need a separate PRM program—why couldn’t I use my CRM program?

The main reason is the difference between partners and customers, between direct and indirect sales. Your internal sales cycle and partner sales cycle require different staging, support and activities from your company. A PRM solution allows you to manage that without getting in the way of established internal sales processes.

You can try it—some of our customers have come to us after attempting to combine their CRM and content management systems into a partner relationship management system. What they run into is conflicts between what they needed internally and what they needed for partners. Trying to make a CRM tool work as your PRM tool will ensure that it serves neither purpose well. It can also be very expensive to use your CRM this way.  The Channeltivity PRM software integrates completely with existing CRMs, including salesforce.com, to help make implementation and training simple.

Why not build a PRM system ourselves?

Maybe you can, but that doesn’t mean you should. You wouldn’t build your own accounting system or CRM system because you know it’s not the best use of internal resources. If you’re thinking of creating a PRM system from scratch, there’s a good chance you’re underestimating the demands of the project. It’s the kind of investment that should really be reserved for the development of systems that support unique, proprietary processes.

Also, by foregoing the expertise offered by a PRM vendor that focuses on the intricacies of managing a partnership, you’re at risk of stalling your partner program in its early stages. About the time your channel program starts having success, it may very well implode under the pressure of growth and increasing partner demands.  A partner relationship management software solution will offer the flexibility, scalability, analytics/metrics, and support that you will need to be successful out of the gates with your channel strategy.

For starters, understand that the most prevalent source of conflict within the sales channel is having a direct sales force that doesn’t work with or support the channel. Sales and marketing should both be clear that part of their job is to ensure the success of the partner relationship program.  To this end, many organizations find it beneficial to hire a sales force specifically focused on selling into the channel and to build a channel management support department.  For more on the human resource qualities needed for a channel program, review our recent blog post on hiring for the channel manager position.

And of course, recruit partners strategically—more is not necessarily better; understanding where the need is geographically and by industry is step one. New partners should have contacts that dovetail with current partners—not compete with them.

Establishing clear rules of engagement with partners is also important. Those rules need to take into account the realities of the relationship, including the fact that each side—vendor and partner—has its own agenda. Vendors want the channel to shoulder vendor cost of sales, while partners want vendors to provide a service that minimizes partner cost of sales. Structure a relationship that takes both sides’ needs into account.

As an example of a way to minimize channel conflict, I can tell you about a successful program I worked on years ago. My company had just signed a Fortune 500 computer manufacturer who was selling third party tools, and working basically off no margin. We knew they could undercut our partners to the point that they couldn’t resell the solution. So understanding that, we built into our program a way to support our partners in competition with the manufacturer.  We let them know that we would support them through the sales cycle if they registered the opportunity—however, we obviously couldn’t tell an end user where and how they needed to purchase. So we made it clear that if they lost a registered deal to the manufacturer, we would pay them what they normally would have received in their margin.

We made this plan very visible to the partners, which established a level of trust and a lot of comfort with reselling our solution. Our partners knew that if they did lose a deal to the manufacturer, their effort would not go unrewarded.  And the manufacturer also understood we were working with our partners this way.

Since the manufacturer is not going to sell the solutions—they’re just going to physically take the paper—we knew they wouldn’t provide the real work that a normal reseller would. Plus, there were so many opportunities for people to sell that there wasn’t a lot of overlap.   So we only had to pay the margin on a lost deal twice in the time that we had the program. It was very well regarded and won the VP of Channel Management an award.

The main purpose of the program was to show our partners that we knew there would be conflict and that we know how the world works. There are partners I worked with on this deal who years later still remember this program. They weren’t even partners who benefited from it, but they felt the comfort level.

I thought about it, and responded, “No,” not because Channeltivity doesn’t have documentation and training materials—we do. I answered “no” because I don’t believe partners are engaged by documentation and training materials.

Create a High Touch On-boarding Process

Real loyalty and engagement is created through interaction and incentives. We all know what it feels like to make a buying decision or sign up for something and then feel a drop in the attention we get from the seller. It doesn’t engender a productive relationship, and it’s no different for partners.

Instead of burying partners in materials, I would suggest you up the attention 200% immediately after signing a new partner. Show them you have a guided process for on-boarding. Spend time familiarizing them with the partner portal. No amount of great content, videos, etc. will cause a partner to onboard themselves.

Remember these three keys to successful on-boarding:

1. Schedule a web-based training to familiarize the partner with the portal, its navigation and resources. Show them processes supported such as Lead Distribution, Deal Registration and Market Development Fund requests.  Make this a train-the-trainer session. Record it and put it in your Resource Library for their future reference.

1. Don’t do one-on-one training. It’s not cost effective. Onboard a block of no more than 7 to 10 partners at a time.  This does two things: First, it shows your partners that they are part of a growing program. Second, 7 to 10 is a manageable group that can have good interaction and high quality Q & A.

1. Share relevant, meaningful and timely content. Once your partner is on board, they need a reason to interact with your portal. Lead Distribution, Deal Registration and Market Development Fund requests are obvious interaction points, but you can provide incentives earlier in the sales process.  By sharing content that helps partners better understand your product and how it can serve their customers, you give them a good reason to return to the portal often.

Now that you’ve got these partners successfully selling for your company, how do you continue to grow your sales without creating channel conflict? In our next blog post, we’ll share tips on how to expand without cannibalizing your sales.

Not getting ready before moving to the “aim” and “fire” phases may be the most common reason for the failure of an indirect channel marketing strategy. You can invest the time now in fully planning your channel marketing strategy, or you can pick up the pieces in a year or so and try to do your planning after an unsuccessful first attempt at effectively managing your channel.

The beauty of getting ready first is that you can avoid all those drains on revenue and resources that are created by too little forethought. Establishing clear processes and making decisions about all the details of your partner strategy also makes it possible to more accurately monitor results of your channel sales program and make the right tweaks when they’re needed.

Below are some questions to help with the planning:

• What are your company’s goals and objectives for the channel marketing program?
• How will these goals and objectives be reflected in your partner relationship management approach?
• Who will champion the indirect sales channel and focus on ensuring its success?
• How will you segment the channel?
• What kind of buying experience are your customers looking for?
• How many partners will you need for a successful partner program?
• What skills, expertise and contacts do the ideal partners possess?
• What makes your product a great one for partners to resell?
• What levels will be included in your partner incentive program? (Two is not enough)
• What’s your goal for revenue per partner?
• Where (geographically and in terms of industry) do you need to start recruiting your partners?
• How will you monitor changes in the market that indicate you need to change your geographic or industry recruiting focus?
• How will you train and support new partners?
• What programs will be in place to prevent channel sales conflict and margin erosion?
• How will your partners share information about the market and your product?
• How will your channel marketing plan and processes scale as you grow?

Once you have answered all of these questions and included them in your go-to-market plan, you can then begin the AIM and FIRE portion of building out your strategy.  Since you will have defined the partners that will be the key targets for you, you can then easily hand over these targets to a recruitment force, sales team, or business development team (or person) to make contact and get them on board as a partner within your channel.

Having a simple process for onboarding partners can result in a quick time to market for them to begin firing sales your way.  Leveraging a channel management software and analytics package can help maintain traction, monitor successes for replication, and easily identify and address areas for improvement.