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When selling cutting-edge technologies, foundational elements governing effective partnering still apply.

October 13, 2017

5 Min Read
Strategy
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Jim Carracio

Jim Caraccio, Director of Channel Sales, Exosite

For the past two decades, I’ve been responsible for setting up and managing partner programs at various companies. While technology has evolved dramatically in the past twenty years, the recipe for successful partnerships has remained the same. That remains true at my current company, Exosite, an IoT software platform provider.

Here are four basic best practices to successfully develop and manage a partner program, with insights for IoT and both sides of the equation.

Understand current and future market needs: Too often companies and resellers set out to build their partner ecosystems without fully understanding what the market needs and how their partners are going to address those needs. Then, when those partnerships don’t lead to success, they tend to throw out one of these excuses:

  • “It worked once.” When organizations have a successful engagement with a company on one project, they often think it means there is market demand that merits a full-blown partnership.

  • “We need to keep up with the Joneses.” When an organization’s competitors are partnered with a specific company, they may feel compelled to do the same.

  • “Hey, I caught the big one.” Organizations often think they can work with all the big players in a market and customers will come running based solely on the size of their partners.

Although these are useful data points that should be used in your overall decision-making process, your partnering strategy shouldn’t be based on any one these alone; instead, use research. Get data. For example, if you are focused on a specific vertical, leverage the research that vertical associations publish. In the IoT space, if your focus is in the smart-building and smart-home space, join the Continental Automated Buildings Association (CABA) and similar groups. They have teams of industry experts providing real-time market updates that will help provide a number of additional data points.

I also recommend that you talk to both existing and potential customers and really listen to their needs and business pain points. The key takeaway here is to make sure you explore the resources available to help you understand the market. Then build your partner strategy based on data, not what worked before.

Increase value to the end customer: Companies are in business today because they provide products and services that fill a need customer’s need. That’s as true of resellers as suppliers. A key goal of any partnership is to demonstrate that the combination of your partnerships provides a higher value proposition to end customers than you offer as a standalone company. Think of it as 1+1=3. The value proposition can take shape in a number of ways, so don’t limit how you promote your partnerships.

For example, at Exosite, we have several different categories of partners. One of them is our edge partners that provide products and solutions on the device side of an IoT solution. Their products include sensors, low-power microcontrollers and …

… radios, gateways that sense and communicate data to our cloud platform. The value that edge partners provide customers is an integrated solution that can sense, aggregate and communicate data to the cloud. This saves time and money while reducing risk for our customers.

Develop clear value propositions for each partner: Along with understanding the value proposition for your end customer, it’s essential that there’s mutual value identified between you and your partners. Integrated solutions (like the one noted above), lead sharing, revenue sharing and co-marketing opportunities are examples of engagements that provide value to both sides. Integrated solutions will drive both co-marketing opportunities and, hopefully, new customer engagements; this level of partnership is pretty straightforward and well understood.

There are other partnerships, however, where one partner might have intellectual property (IP) or other building blocks to complete a compelling solution, but lack access to relevant customers. In this scenario, a revenue-sharing agreement might be a useful way to partner. The partner who has access to customers is then responsible for promoting the partner company’s IP with the benefit of sharing in the sales revenue that results. There’s mutual value in this example, as the IP company is selling more with little involvement and will gladly pay their partner to promote and sell their IP. The key takeaway here is to be creative in how you derive value from your partnerships, and make sure the relationship works for both parties. Too often partnerships are one-sided, leading to failure over time.

Commit to keeping partnerships relevant: The final element to a successful partnership is the need to continually assess changes in your focus markets, as well as changes in your customer and partnership needs. Technology continues to advance at a fierce pace, which can quickly change the needs in a given market. We see this in IoT as well as other hot areas. Technology will also impact the needs of your customers, who may need support with a new wireless technology, protocol or development tool.

If you’re not continually evaluating and making changes along the way, your partner program will become stale and ineffective.

As director of channel sales, Jim Caraccio directs the partnership programs at Exosite to engage and support channel partners and other enterprises to optimize business strategies and ROI for Internet of Things (IoT) innovation. He brings more than 25 years of experience working with partners and customers by sharing a passion for embedded hardware and software design innovation, engineering excellence, and the IoT evolution.

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