Building A Strong Channel Partnership Takes Time
We are living in a world that moves at a much faster pace than any other time in history. Instant gratification is a click away, or verbal command, where bots and algorithms satisfy any request. Let’s face it, there has been no better time to be alive on this planet — no matter what you read about in the news, or on your social media feed. However, fantastic technology advances aside, all of this instant self-service makes it a challenge when you are trying to build new partnerships. When it comes to building a business, no one person is an island. And bots won’t cut it.
From a business perspective, there are many reasons to build out a channel. Chief among them is adding additional sales resources, and taking advantage of existing customer relationships that the channel partners bring to the table. This is especially important when building an organization in a fast growing market. The entire goal is to reach target customers faster, and less expensively than you could achieve on your own. This requires a commitment to the model, and execution of the plan.
Let’s assume you have settled on a channel sales compensation model, based off of your own direct sales experience…and you are ready to execute a plan to turn on the channel to help you expand your reach. Here are a few things you need to have or be aware of:
Patience: Channel sales usually take a long time to get off the ground. The reason for this is that your new partners have different priorities than you do. While you are totally focused on your product, they are focused on other products and vendors that keep their lights on. You will be a small part of their revenue plan…and your solution will have to convince them, over time, to invest more of their time in you.
Resale: If you are taking the reseller approach, be prepared to be constantly compared to the existing solutions that reseller has built a business off of. There will be constant friction because change is painful, especially if it requires financial investment. Anything seen as cannibalizing the current business model will be met with resistance. These relationships take the most time to develop, because they generate the most friction at the deal level, impacting the sellers compensation. The sellers are the ones who have to get religion about the solution, and they are the biggest skeptics around.
Profit: You need to understand how your channel partners make money. Selling product may only be the insertion point into a target customer. Do they prefer to charge for consulting services or integration services? Do you have enough margin enhancement to incent them to resell, or would they rather you handle that side of the business? One of the best ways to ensure channel partners see value in your solution is to incent your own sales organization to leverage partners vs going direct. This shows that you have extended trust, and places a higher value in the partnership.
Educate. Educate. Educate: Channel Partners, especially in the beginning, need consistent and persistent education. You need to remind yourself how long it took you to learn something. This isn’t an overnight cram session. Real e