Co-sell the Cloud: 3 Steps to Success

A referral model feels like a seismic shift in the customer relationship, but it’s here.

Channel Partners

January 16, 2017

4 Min Read
Cloud Sales

Marc MondayBy Marc Monday

Those of us who make our living in the channel know the old adage: “Change is the only constant.” Some of you may recall from your Greek history that this phrase is attributed to Heraclitus of Ephesus, who is remembered for the doctrine of flux. As a channel partner, you can no doubt relate. At times it does feel like the marketplace is shifting under our feet.

But there is another old adage I like to think about when I am, at times, overwhelmed: “Change breeds opportunity.”

And oh boy, is there a lot of change right now in the world of IT. Bots, AI, IoT, cloud, big data — it’s all happening at once. And if we are, at times, overwhelmed, I can guarantee our shared SMB customers are completely unprepared for these shifts.

What clients and customers need now, more than ever, is your patient, trusted advice on what solutions to implement to solve their business problems. For years, you have provided them with guidance and fulfillment of IT services and hardware. And while many of those hardware opportunities are going away or being commoditized, there is a whole new set of revenue streams and upsell/cross-sell opportunities around what technologies to leverage in the cloud, how to implement, and the opportunity costs associated with those decisions.

Co-selling: Fast Path to Revenue and Happy Clients

One thing that has shifted with cloud is around how services are provisioned and sold. If you are used to reselling, you may be intimidated by referral models. You may even feel at times like you’re losing control of your client — and sometimes, it may be true. But a prevailing perspective in this emerging world of customers buying what they want, when they want, and how they want suggests that adapting to new models, like co-selling, can be pragmatic, easy, sticky and lucrative.

A co-sell model is by far the fastest path to cloud revenue with little or no overhead or costs. By embracing referral models, you can guide your client to an ideal cloud solution without having to do heavy technical training, operationalize complex cloud billing systems or “going it alone” while the vendor sells direct.

In partner-centric co-sell models, like we have recently launched at Concur, the emphasis is on “selling together” and focusing on customer satisfaction while still having the advantage of gaining recurring revenue.

3 Steps to a Future-Proof Channel Strategy

The most important thing you can do to future-proof your channel co-sell strategy is to assemble a portfolio of ISVs and vendors that meet your customers’ needs and expectations now, and in the future. Here are four steps to take to get there:

  • Determine the client segment/audience you will serve and your “line card” for the cloud. What specific pain points will you solve? Define your target client and ideal buyer. Align your business to help clients with their journeys to the cloud, not just in terms of technology and workloads but also the shift from more traditional capex to an opex model.

  • Build a compensation model for your sellers that aligns to the cloud economics of the vendor. This is the most important step in the journey — if you don’t shift compensation to address the new model, your reps will invariably continue to focus on legacy on-prem, larger one-time payouts. A move to the cloud means a move to the subscription model, and revenue that comes in over time. You need to be comfortable with this as a business owner and model your P&L and comp programs to address this shift.

  • Look for best-of-breed ISVs and vendors that understand and cater to the best digital transformation paths for the clients you serve. Build partnerships with suppliers that can provide education to you and your clients to drive accelerated paths to digital transformation. Build practices with vendors who show an interest in your future and own business model transformations. 

Follow these steps, and you’re well on the way to a sound channel co-sell strategy.

There is a somewhat famous painting by Johannes Moreelse depicting Heraclitus as a “weeping philosopher” looking over a globe. Certainly, we channel partners can relate. But if you consider your audience carefully and adopt a co-sell strategy, you can keep your customers satisfied and your business happy even through constant change.

Marc Monday is VP of channel sales, partnerships, & business development for Concur and manages the Concur Solution Provider Program.

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