Keeping your Channel Programs Straight

How do solution providers wade through the numerous channel programs they are a part of? While at a channel event I met with upwards of 30 solution providers that sold for the same set of vendors. When asked about things like incentives, tiers, communications, and training I did not get a single consistent answer.

My first inclination is that with so many different vendors it is hard for the solution providers to keep the programs straight but I realized that many of these solution providers only sell 3 or 4 solutions. The programs have so many different elements with so many changes per year, per quarter, per month, at any given time channel partners have no idea where they stand.

What would help you as a solution provider? Vendors, what are you doing to help already?

Are you Tuned-In to your Channel Partners?

Some partner programs pride themselves on their extensive number of partners. Congratulations, are partners supposed to be excited about that? Welcome to our partner program! You now have more competition for your business then you did before you joined. I'm not saying vendors should have fewer partner, let's be reasonable. But, don't be so out of touch with your partners that you promote your partner list as a benefit to them.

As I wrote in "One size does NOT fit all" channel partners want a tier and a program that fits their business. You must recruit them with this in mind. Telling them their competitive landscape has just tripled doesn't really help. So what does matter?

1. Ease of Use: Please! When I was an alliance manager I worked with several vendors. The one we sold most often was the one whose program was straight-forward and whose portal did not require a PhD to navigate.
2. The "What's in it for me?" factor: Do I need to explain? If a partner sells your competitors product and makes more money, the only time they will sell your product is when a customer demands it. You'd better either have great margins/rebates/incentives or you'd better have the best product out there.
3. Lead generation: Ask any solution provider what they wish their vendors would do better and they will say lead generation. Either handing over nurtured leads or providing them with the right tools to get the leads themselves. This doesn't mean sending them email campaigns that only talk about your products' value prop. They need to be customizable so the solution provider feels it represents their business as well.
4. Support, support, support: Not just technical anymore. Partners need to know that they can get what they need from you in minutes. If they are out on a sales call and need a quote or piece of collateral it better be smooth.

Vendors who do this have the highest satisfaction ratings despite some of the largest communities of partners. They aren't talking about how many partners they have, they're talking about what they do for them.

Who does this right? I'd love to hear from solution providers and vendors.

Has dell made the grade in the channel?

While working at EqualLogic, about 2 months before the Dell deal was finalized (and I was to become a Dell'er) I was at a conference where solution providers were giving vendors feedback. There stood a very articulate solution provider who had just given the audience some great feedback on what works and what doesn't when it comes to communications, rebates, margins, and incentives. "And one more thing", he added enthusiastically. "I don't care what they do, I'm NEVER doing business with the four-letter word in channel!"

A gave a little chuckle with the rest of the vendors in the room, then it hit me. Wait! He was talking about me! I was going to be Dell, I was going to be the FOUR-LETTER WORD IN CHANNEL! Over the next 8 months I watched Dell flounder and put forth a very strong channel program. But had the damage already been done? Could Dell dig themselves out of the hole?

Well what do you think? Has Dell made progress? Would love to hear from solution providers.

The 3 P's of Channel Management

Anyone who has even sat in on a business school seminar has heard about the 5 Forces, 3 M's, 5 P's, SWOT, or 4 Q's more than enough times (I made the Q one up by the way) so why can't the channel have one?

This is the 3 P's of Channel Management; Product, Program, Price.

If you don't have a good product, no one will want to buy it. If no one wants to buy it you can bet no one will want to sell it! I know what you're thinking. As a channel manager or marketer you have little to no control over the product. What you do have is feedback from the solution providers and customers. You should do everything you can to get that feedback to the right people. If you don't have a good product and you've done everything you can do, maybe you should think about moving on.

Product being equal, with your competitors the next thing solution providers are going to look at is your program. Do you charge an arm and a leg for training? Are your requirements realistic and do the benefits fit? How easy is it to get business for your product? Do you assist with marketing efforts? Are your solution providers going to be competing with your direct sales staff for the same opportunities?

I bet you thought price was going to be first. Not so. Don't get me wrong if your margins are a fraction of your competing vendors you're going to lose but if your margins are reasonable your solution providers care more about being able to sell your product. It also depends on your place in the market. If you have 25% market share and customers are asking for you and nobody else but you (thanks to your product, see 2nd paragraph) then you can give less of a margin. However if you are at 8% market share and seeing the same 5 competitors in every sales call your partners are making there should be more of a benefit to those solution providers.

Where does your company stack up? Solution Providers do you have any input?

Are you a fair weather VAR/Solution Provider?

Do you belong to more partner programs then you have sales people?  Do you sign up to become a partner simply because your customer wants to buy that vendor's product?  Do you sign up for vendor programs then never complete the requirements?  With all of the vendors and products to choose from no one could really blame you, but is it truly benefiting your business?

The best way to get the most out of a channel program is to commit to the requirements and position yourself as the "authority" on that product or solution.  So why then do so many solution providers spread themselves too thin?  Should vendors have a referral program instead so the solution providers with customers ready to buy don't have to act like they are going to commit to the program?

Training. To charge or not to charge, that is the question.

Charging for training is something you would do to a customer or client.  So why do so many vendors charge their partners A LOT for training?  I understand that there does need to be that give and take.  Still, I don't see that paying thousands for training exemplifies this.  

If you are being charged by the company administering the training and testing I can see just covering that cost or giving some sort of guarantee that if they don't sell anything in 6 months they will be charged in the future but only to cover the cost, not make a profit.   For the vendors who truly see their solution providers as an extension of their own team, there should be absolutely no training costs.  It would only benefit the vendor if the channel partner actually knew how to sell the product and sell it well.  The other benefit to you is that ostensibly that solution provider is more likely to sell your product then another if barriers to doing so are low.  Two birds, one stone.