Staying relevant in a changing world: 6 things to consider in the channel

Jon Nation

By Jon Nation on 12 Apr, 2018

Jon Nation is TBT's Client Strategy Director for new business. He knows exactly what makes marketing programs successful and has more than 15 years experience in the IT industry, understanding what his clients want and delivering the results that matter.

I have had many discussions recently with technology vendors that are in the process of transforming their business to meet market needs and competition, ensuring that they can grow and stay relevant. This has included moving to cloud-based solutions and expanding to include software in their offerings.  

When considering transformation and development of the solutions you offer, one area that often gets less attention than it should is the partner ecosystem and how they form part of the strategy to be successful. Often organisations have legacy partner programs that have not been updated, leaving current partners open to the competition’s more up-to-date approach.

Strategic transformation that also brings your channel partners with it is not straightforward but it can be successful. The one constant in all of this is that there will be many involved that do not like change. These are my top six areas to consider:   

1. What are the strategic objectives and requirements of the transformation?

It’s pretty much always the starting place for any successful change and getting this right and agreed up front from all those involved will save a lot of time and effort later on. It’s worth breaking this down into as much as possible and then grouping them into categories that will enable you to focus your efforts. Trying to do it all at once may not achieve anything.  

2. Who are your current partners?

This may sound obvious, but I often find that only a small percentage of a vendor’s channel is truly known. Profiling your partners allows you to identify the good the bad and the ugly — without having this information it is not possible to know where your gaps, and indeed opportunities, are. It is often a good idea to use partner rep and distributors’ feedback, but also consider independent profiling to get the unadulterated truth. At this stage it's worth validating the strategic objectives you selected to test that you have picked the right focus areas. 

3. Reasons to partner with you — are they an incentive or outdated?

There is a lot of competition and although your partners may say they are loyal — they also have objectives and requirements and if they can get a better or easier deal elsewhere what’s to stop them? 
There are three key elements to consider in all your dealings with partners; 
Trust — this is both ways and is critical, as in any relationship. 
Reward — is it worth the investment to invest in you as a vendor, is there enough margin/does the market want your solutions? 
Investment — what non-financial benefits do you offer this could include — marketing and technical support, validated leads, exec alignment etc.

"I often find that only a small percentage of a vendor’s channel are truly known. Profiling your partners allows you to identify the good the bad and the ugly"

4. How do you compare to your competition?

You will likely have competitors and this is fierce in the partner community too.  One of the first places your competitors will look for new partners is in their competitor channel — yours! Understanding your competition’s channel program and offerings is a great way to (a) ensure your program is offering at least the same and if possible more and (b) becoming a more attractive option for your competition’s partners.   

5. Do you have the right partners to reach new markets and buyers? 

As with many routes to market, change is the norm — take for example the explosion of online stores and apps such as Etsy or Amazon taking huge bites of market share from the high street, or Screwfix and Toolstation targeting the DIYer fed up of sky high prices at the normal DIY stores — (Oh and by the way B&Q and Screwfix are both owned by Kingfisher!) Understanding who your buyer is and how they want to buy is key to developing new routes — for example making it easy and profitable for an ISV to integrate your solution into their solution or sale can open new markets.  

6. Support — how can you offer more of the right support? 

Sometimes with the best intentions comes a stack of extra work the partner can’t manage and didn’t want. This is not the easiest thing to avoid as it is a high-pressure sales environment and so 'help' often comes with a request for planning/reports/justification/resource/money and more… Don’t get me wrong, all of these things have value but ensuring that they do not become an overhead to your partners is critical. I’d suggest that the lion’s share of this overhead is taken on by you as a vendor, where possible, to allow the partner to sell your solutions or reduce the requests for this kind of information. 

So now you have a starting point to transforming your channel strategy.  Each of these areas will inevitably take time, effort and experience to explore effectively and will lead to more areas to assess.   

My advice would be to enlist some of your best and most experienced talent, doing this alone is not simple and often ends in tears — oh and get a budget! Drop me a line if you want to talk, I love this topic and will happily act as a sounding board.

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