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The Five Most Important Factors for Building Partner Loyalty

Build Partner Loyality

Finding a way to motivate your partners is just like motivating any team. Vendors need to figure out what partners are looking for to build a more successful business. Gary & GinaMost successful business partners are motivated by two things; a strong relationship with a vendor and the ability to make money. Where does that leave vendors who are looking for a partner to invest in selling more of their vendor-delivered products? Vendors will win if they can create a trusting relationship, be simple to do business with and help partners package and sell more partner-delivered services along with their own products.  Vendors can achieve their goals and their partner’s goals if they keep in mind these five motivating factors for building partner loyalty.

Partner Loyality

How do you know if your channel brand has the right stuff to generate motivated and loyal partners?  Will your partners say “yes your business is doing all the right things to motivate my organization to invest in growing your brand”? The following screening questions can help you determine whether-or-not your channel offering is developed enough to build loyal and motivated partners:

  1. Mutually Beneficial Relationship: Do your products support the markets and services the partners are in or want to penetrate?  Do your partners immediately recognize the clear and substantial difference and advantages that your products / solutions offer vs. products they already have?  Do they understand how they fit into your coverage model?
  2. Mutual Trust and Respect: Are your partners often surprised by changes to your approach to deal registration approval, the sales process, the products or the prices?
  3. Ease of Doing Business: Is it obvious to the partner that you are designing programs, processes and systems to streamline their sales process?  Are you providing truly partner-valued resources including sales support, enablement, business consulting, technical support, tools and other resources to help them succeed?
  4. Profitable Products: Have you helped your partner build a customized profitability forecast for the sale of your brand including product and services revenue forecasts, costs-to-deliver estimates and a calculated P&L statement?
  5. Package Partner Services: Have you helped your partners model, package and prototype additional profitable services that they can “wrap around” the sale of your products?

To help answer these questions, let’s take a look at the characteristics of delivering these five things to you channel to generate loyal and motivated partners.

1. Mutually Beneficial Relationship: The most important thing is for vendor partner managers and executives to get to know their partners from the very beginning and then continue to keep a pulse on their business plans.  Some sample discussion topics include:

  • What are their business goals and growth plans?
  • Into what new verticals or service areas do they plan to expand?
  • What are their most profitable practices?
  • How are their sales and services people paid?
  • What are the three most important things a vendor can do to help them grow their business?

With that information, be specific about your expectations of partners and what you will provide to them.  Help partners develop a profitability model during the recruitment process so they understand the costs, the time-to-profit and how profitable the business will be.  Also, be specific about why you are recruiting them and what you are willing to give them for it.  For instance, if you want to expand into the healthcare market and the partner you are recruiting has a thriving healthcare practice, be specific about how you plan to support them with programs and resources to take your products into those customers with things like additional margin, more marketing programs, access to corporate leads, and limited partner recruitment in their key coverage areas.  If they have that information, partners can make an informed business decision and they will view you as a valued business partner because you have shown how you can help them achieve their goals.

Then continue to build on those initial discussions with regular business reviews to examine delivery against the profitability goals that were set up and the effectiveness of campaigns, incentives and programs.  This should not be a “what have you done for me lately?” discussion, but instead should be a “how do we work together to fine-tune things that make the business relationship even more effective?” discussion.

Finally, if you have a large channel and work through distributors, enable the distributors to have this same discussion with your partners on your behalf.  Train partners as you do your partner managers and give them the tools to have the business discussions.

2. Mutual Trust and RespectA very important part of maintaining a strong relationship is “doing what you say and saying what you do”.  When you conduct partner interviews, the vendors who have strong people that work with them in the field and have a well-communicated and consistent approach to the channel score much higher than those that don’t, even if their program is more complicated.  The channel is used to programs or sale models “du jour”, so a vendor who is consistent and who has a transparent communication style when changes happen has a competitive advantage.

Here are some examples of things you can do to promote trust:

  • If the deal registration program documentation defines how conflicts with direct or partner sales are to be handled, handle them that way. Your partners will find out if you don’t.
  • If you have a direct sales force, be clear with your partners on the engagement model and then protect that fiercely, even to the point of penalizing the direct sales person who breaks the rules.
  • Communicate changes to your partners well ahead of when you communicate them to the customers, including how it will help the partner or ways they can mitigate any impact to them. Don’t let them be surprised.
  • Deliver things like incentives in a timely manner with the minimal amount of hassle.

Some of these things may be inconvenient or costly in the short term, but the best long-term relationships are based on trust.  Once trust is broken, it’s very hard and costly to rebuild.

3. Ease of Doing Business: Put yourself in the shoes of the individuals at the partner. They have multiple vendors with different portals, pricing tools, approaches to training, deal registration programs, etc.  The more points of friction they encounter with a vendor’s processes and programs, the less likely they are to work with that vendor. This could limit the willingness to provide the needed information, put an extra burden on the vendor’s partner manager or even make them choose the competition over the vendor in a deal.  If you make their life easy, it increases loyalty and enhances the relationship.

Here are approaches to consider to increase the ease of doing business:

  • Be aggressive in your internal education on what is important to the partners. The more you do with your internal stakeholders on preparing for the channel, the more likely you will be to get content, processes, etc. that are designed for the channel.  The use of an editorial calendar is an excellent way to get that process started.
  • Prototype programs, processes, and systems with partners. They see the best and the worst in the industry.  Put something in front of them to give them “something to disagree with”.
  • Be clear on what you need to run your business and channel programs and don’t ask partners for any more than that.
  • Even if you have multiple systems supporting your partner program, make it as easy for partners by providing one simple way to gain access and navigate to what they need to get their job done.
  • Make it simple for partner managers to provide information to partners by providing easy-to-use training and tools in an accessible central location to which they can direct partners.
  • Identify all communication touchpoints, from onboarding to shipment notifications. Look for ways to reduce and optimize them.
  • Continually revisit the partner experience to look for small changes that can produce big wins for the partner.
  • Customize the experience for the individual. For instance, if an individual is accessing the portal, don’t make them wade through marketing material and sales tools they won’t use.  Put everything they need on the home page.
  • Make design trade-offs to support simplicity for partners and then fine-tune processes to make it easier for internal resources instead of the other way around.

The most important thing to remember is that the more people in the vendor organization who understand the partner view, the easier time partners will have working with you.  That supports the relationship and creates trust.

4. Profitable ProductIt is not enough to have wonderful products and a great market opportunity.   Partners will get behind and invest in vendors that show them a path to greater profitability.   Partners are not experts on how to make money with a vendor’s brand, but the vendor should be.   Vendors need to be in the business of showing their partners how to price, staff and deliver their products profitably.  Doing this is usually part of the partner business planning process.  Below is an excellent example of a work-flow application designed to help partners build custom profit-based plans for the sale of your products or services in minutes.

Full Year Consolidate P&L

Providing your partners with a guided process to create custom profit forecasts in minutes will give them more confidence in how to price, staff, package and sell your products.  This will lead to much more committed partners who are more willing to invest in growing your business with them.

5. Package Partner Services: Partners are interested in selling your products, but are even more interested in selling other partner-delivered services that are wrapped-around the sale of your products.  Partners want vendor’s help in designing services that complement the sale of their products.  Specifically, they are looking for all the following from their best vendors.

  • Complementary services design: Help identify partner-delivered services areas that complement the sale of a vendor’s products including delivery, support, and services from business solutions
  • Suggested pricing and packaging recommendations: Suggest how to package, define the deliverables, and price these partner-delivered services to generate new revenue
  • Services staffing and delivery approaches: Provide partners with detailed suggestions on how best to staff these additional services including the types of staff, skills required, estimated hours for delivery of key tasks and metrics for services delivery

Partners need vendor’s help and expertise in building a sustainable and profitable business around the sale of vendor’s brand.

The suggestions in this article are simply common sense recommendations for the success of any partnership.   Both parties take extra time to understand the other’s needs and requirements and deliver a mutual trust-building and motivating experience.   If you keep in mind all the things that have worked for you in any other partnership in life, most of this will be equally applicable to your channel partnerships.

Channel Account Manager Reseller CXO Successful Channels Reseller Marketer Reseller Salesperson Channel Chief Image Map