The Channel Partner Recruitment Dilemma
When a vendor channel is in the early stages of development, their requirements for channel partners are usually only that they have a pulse. Fast forward 12 to 18 months, and a fledgling channel program involves 5% of partners who are actively engaged and 95% who sold once on a customer’s request and then disengaged. So what’s the fix?
As an early stage channel program I’m not suggesting that you turn partners away, but there are a few easy ways to assess the level of involvement they may have in your program. For all the others, set up a referral program. This allows partners following customer instructions to still make the sale but not take up valuable administrative time from the vendor’s channel team.
So how does a channel team assess if a partner is recruitment material? Below are some suggestions, I’d love to hear others:
1. Analyze the overall partner fit. A partner application should include a question around their annual revenue. If a partner did $250K last year and your product costs $250K, chances are they are not tapped into the right customers to sell your product or they may not have the resources to provide the support your joint customers may require.
2. Does your product fit the partners business model? If a partner focuses on projectors, laptops and phone systems they most likely aren’t familiar with, or capable of, selling a vendor’s enterprise storage array. This is probably a one-time request and the vendor would be better served to assist this partner or set them up with another partner who could offer a referral fee. If the partner, on the other hand, sells a competitor (NetApp to Dell EqualLogic) then the partner is very familiar with the product type and is probably looking to expand their offerings.
3. Is the partner willing to put skin in the game? If a partner is willing to attend training or has a lot of questions around how to better sell/market a product they are willing to put as much into the relationship as they hope to get out. If they immediately ask for leads before they know how to sell or market the vendor product chances are good they aren’t going to add a lot of value. How can you distinguish between the two? Put requirements in place that easily measure this such as a 30-minute introductory webinar that walks partners through the facets of the partner program and product value proposition with a few (literally no more than 10) questions about what they’ve learned. If the partner can’t attend a 30-minute webinar or podcast you certainly are not going to get them to attend a 2-day training.
4. Set a probation period for inactive partners. Maybe they’ve already been recruited and did a deal here or a deal there but for the past 12-months nothing is really happening. It’s time to clean house. Set up a renewal certification, business plan requirement, or sales certification update and be clear that if this requirement is not completed in 3-6 months their partnership will not be renewed. This is not to say that partners who aren’t currently selling your products are not worth working with, but they need to ensure you that they are still engaged.
These are just a few thoughts for getting the right partners with the right customers into a channel program. I’d love to hear what other tactics vendors are using to improve their recruitment accuracy.
Contributing blogger Heather K. Margolis, the Channel Maven, has led channel programs for major IT companies. She also has extensive lead generation and marketing experience. Follow The VAR Guy via RSS; Facebook; Identi.ca; Twitter; and via his Newsletter; Webcasts and Resource Center.
I always like articles related to Channel Sales and Manufacturers and how they engage the channel and this is one of the best articles on the subject I have read in a long time. There is not one thing wrong with this article.
As a 20 year channel player, what gets my interest as a VAR is when a software manufacturer calls me and says:
Stage 1
‘We are looking for partners in your area. ‘We either do not sell through CDW at all’ OR ‘I can show you how to sell our product at the street price and make 30% on the software sale’.’
This piques my interest and then I want to know what the damages are. ie. the training requirements/costs or the VAR minimum sales requirements or the VAR’s minimum commitment, etc.
If we never get past Stage 1, then I am not interested at all and thereby consider the technology or product irrelevant or the wrong brand. Therefore I will not recommend it, and if it is a technology that my customer’s need, I am sure I am selling a competitive product that I can make a healthy margin on. If I can make a healthy margin on a product I WILL PAY FOR TRAINING. I WILL COMMIT TO A MINIMUM QUANTITY OR ANNUAL/QUARTERLY SALES NUMBER.
In summation, just because a dealer doesn’t meet the minimum nut of a manufacturer’s sales level (gold/silver/platinum, etc) isn’t necessarily caused by the fact that the dealer may be a loser. It may imply that the dealer is selling another product that is more lucrative.
I am a dealer. Tell me what to sell, and if it makes sense FINANCIALLY, I will.
Let’s face it that there are a number of doomed and dead manufacturers out there, that are limping along because it doen’t make sense financially that VARs sell that specific manufacturer’s product. IT HAPPENS EVERYDAY! I AM LIVING PROOF!
Great post Heather, thanks!
I’d probably check and discuss 2 additionnal points:
– Partners’ capacity to bring complementary solutions/services
More amp; more vendors and in particular in the SaaS field need partners bringing unique value. Integration with the customers IT system is good, vertical customization, managed services and integration with other Vendors to solve customer issues are even better
– Partner’s capacity to be “ecosystem ready”
Partnership like everything has a limited duration; however the relationship has better chances to be fruitful when collaboration is at the heart of it, isn’t?
Social Media adoption and innovation oriented might be 2 success factors.
BTW, not sure I understood where the dilemna is?
HurdyGurdy, thanks so much I am thrilled you enjoyed it. Keep your eye out for Part II when I talk about it from the ROI angle for VARs.
Myriam, very good points! Thank you also for your feedback.