With generative AI transforming the way we work, the need for vendors to recruit new channel partners and upskill existing partners has accelerated, with the aim of building high performing channel partner ecosystems with complementary skills.

Vendors invest heavily in creating extensive content and providing sophisticated tools. Channel partners often under utilise these tools and resources and rarely progress from sign up to generating any significant revenue.

Last year The Channel Company discovered that “25% of partners have terminated a relationship with a technology supplier in the past 12 months, having never transacted in any meaningful way.”

Before we explore this further it’s worth going back a step and acknowledging the initial channel partner sign-up phase is also hard! According to Canalys “Many partners rank visibility and community involvement highest of their criteria for vendor partnership, even higher than product, pricing, programs or margin potential.” Read the full article here.

Vendor time is precious. Creating high value content is critical. And distributing content through the right communities and channels theoretically should lead to new channel partner sign-ups and growth.

As the responsibility to onboard, nurture, and develop channel partners rests on the vendor team the risk of inertia can cloud any potential growth benefit.

It pays to be a top-performer

Most vendors are setup to manage their top-level channel partners who have the skills, knowledge, and appetite to monetise the vendor relationship in a mutually beneficial way. The top 20% end up generating 80% of the revenue, earn all the program benefits, increase margin, earn rebates, increase their partner marketing funds, receive invites to HQ and partner advisory boards. You know the drill.

What about the others?

Did they have a good onboarding experience with you? Are they clear how they can navigate their way around all your systems and processes? Do they have the internal capacity to actively market your solutions in an efficient and meaningful way? Truthfully, the answer is probably no. If you leave them to drift don’t be surprised if you end up with a mass of disinterested partners contributing additional admin time to process and motivate.

To combat this, some vendors have adopted a low-touch model and put the ownership on the channel partner to self-serve, and to a certain extent, be self-motivated to progress through the vendor tiering system based on their performance. Although, in some cases, this still isn’t enough to maintain the momentum built at sign up stage.

Top tips to maximise the contribution of your channel partners

On average, high-performing ecosystems drive 1.5 times the cost reduction, contribute 1.5 times more to annual revenue, and achieve 2.1 times the incremental revenue growth of low performing ecosystems.

Source: EY

  1. At the very start of the process, spend time and effort profiling the right partner who is willing to go on a journey with you. One good question to ask yourself is “are they ready to embrace a XaaS-based business model?”

  2. Keep the onboarding process clear and simple. Make support easily available. Maximise joint business planning and knowledge sharing

  3. Take time to signpost new channel partners through processes and systems. Educate them where to find automated, on-demand self-service materials.

A nod to your channel ambitions

Large vendors can be daunting, complex organisations to partner with for newly onboarded channel partners. Taking the leap from sign up to meaningful revenue generation takes time, investment, and effort. It is not necessarily a linear process. If you can get it right and reach the pinnacle, your new channel partner sign ups will be contributing handsomely to a high performing channel partner ecosystem.

Here at TBT Marketing we can help! Talk to us and leverage our extensive channel partner ecosystem expertise to help expand your business.