Channel Sales: A Comprehensive Guide to Successfully Launching Your Partner Program (part 3)
Identifying, recruiting, onboarding, and supporting your partner network.
This blog post is number 3 in a series on establishing a partner network as an integral part of a successful sales strategy and how a well-designed and developed partner program can boost your profits and drive sustainable growth.
In part 1, Are You Prepared to Launch a Successful Channel Sales Strategy?, I define channel sales—how it's different from selling directly to consumers—and address five critical adjustments you must make to your internal business processes to ensure you’re ready to implement a channel partner strategy.
In part 2, Maximize Channel Sales: What Every Channel Partner Manager Must Know, I discuss how to prepare your internal teams for this shift in strategy and mindset.
If you have not read the previous two posts, start with parts one and two to lay the foundation for this post.
In this third and final installment, I provide a guide to launch your partner program successfully. I’ll guide you through identifying, recruiting, onboarding, and supporting your partner network.
As I discussed previously, a channel partner program offers a way to expedite your market entry by leveraging the expertise and support of professionals already knowledgeable about the market, target customers, competitors, and the shifting product landscape.
You can quickly penetrate your market and gain a significant competitive advantage by identifying, recruiting, onboarding, and supporting the right third-party business partners. This type of sales strategy is quite common in the technology industry. Still, it is adaptable to and used by businesses in virtually all industries.
In fact, Forrester, a leading global market research firm, maintains that 75% of the world’s commerce flows through channel sales or selling through third-party business partners.
Forrester’s former principal analyst for channels, partnerships, and alliances, Jay McBain, explained in an interview, “There’s a lot more partnerships than people think. Seventy-five percent of all world trade goes indirectly. You look at the $80 trillion GDP of the world, and 60 of it goes indirectly. So, if you think in your personal life, the last car you bought was from a dealer—that’s a channel. If you look at the last TV you bought—it’s from a retailer. If you look at the last jar of peanut butter you bought, it was from a grocer. Partnerships are in every industry because everything goes through some indirect supply chain.”
Now let’s look at the steps you must take to identify, recruit, onboard, and support your channel partners.
Step 1: Building your partner network: Identifying the ideal channel partner.
Once you have assessed the readiness of your internal teams and are confident that you are ready to execute a channel sales strategy, it's time to take the initial steps in constructing your partner network.
Create the ideal partner profile.
Similar to the importance of identifying target customers for a direct sales team, identifying the ideal channel partner is crucial for indirect channel sales success. Consider various details related to your perfect partner, such as:
company size (employees and revenue)
client characteristics
business model
competencies, expertise, and special skills
product/service similarities
available resources
These elements will form the foundation of your evaluation process and enable you to develop a shortlist of potential partners with whom you would like to engage. Your goal is to determine if a business relationship could benefit both parties.
Evaluate channel partner candidates.
With your ideal partner profile in place, use the information to create a partner selection checklist. This checklist will help you thoroughly evaluate each potential partner against your predefined criteria. Key areas to assess include:
alignment or synergies between the two businesses
financial stability
level of customer satisfaction
operational strengths
specialist expertise
sales skill sets
marketing support
and more
Keep in mind that the selection criteria may vary depending on your specific business, customer base, product offering, and target markets. Evaluating a potential partner's strengths, expertise, market exposure, and alignment with your business goals will provide valuable insights into their potential for early and rapid sales growth.
Build real relationships.
Establishing a relationship with a potential channel partner is a critical component of the partner program launch. Just as you wouldn't marry someone without getting to know them first, building a partner network requires genuine personal connections.
While email marketing, PPC campaigns, and webinars may work for well-known brands like Microsoft in the technology industry or BBB Industries in the automotive industry, these strategies may not be effective for lesser-known businesses or small startups.
To attract potential businesses to join your partner program, you must step away from your desk and engage in personal interactions. Attend conferences, speak at industry trade shows, and participate in live events to position yourself and your company as market leaders worth considering for partnership.
Step 2: Channel partner recruitment.
During the evaluation of potential channel partners, it’s essential to take an active role and ask as many questions as they do. Remember that this partnership is a two-way street. Both parties need to understand each other thoroughly and you should actively interview them to ensure a mutually beneficial partnership.
Consider the following questions when evaluating a potential partner's effectiveness and ability to sell your product or service:
Are new customer acquisition and increasing ARPC (Average Revenue Per Customer) key metrics for them? How do they achieve these goals?
How do they strengthen relationships with their current customers?
Are they successfully selling complementary offerings with which your product can be bundled?
How frequently do they switch from one vendor partner to another?
By asking these questions, and others, you can evaluate the effectiveness of potential sales partners and gauge their ability to sell your product successfully. Overlooking red flags during the recruitment phase can be costly in the long run.
It's worth noting that channel partners typically resell products and services from multiple vendors, so it is essential to understand what they’re looking for in a partnership. Commonly, their goal is to find products that complement and enhance their existing product portfolio and help differentiate them from competitors.
Finding potential partners is not the real challenge you will face; most businesses uncover a pool of potential channel partners from which they can choose. The true challenge for a small or startup business lies in convincing partners to join your program.
It's crucial to establish a strong value proposition to overcome this challenge. Differentiate yourself from competitors by highlighting what makes your product or service, company, and channel program superior or unique. What do you bring to the table that sets you apart?
For lesser-known brands, leveraging the voices of others can be highly effective. When onboarding new partners who find success selling your solution, utilize their achievements in partner case studies, webinars, podcasts, newsletters, and marketing materials.
Sharing their success stories allows potential partners to gain firsthand insights into the experiences of existing partners, their relationship with your company, and how they can also thrive by collaborating with you.
Step 3: Channel partner pre-onboarding considerations.
Before finalizing the recruitment process and beginning the onboarding phase, it is vital to address the following critical issues to ensure a successful partnership. Here are six key questions to consider:
Who is responsible for lead generation?
Assess whether you or your channel partner will be responsible for lead generation based on your business, go-to-market plan, and buyer persona.
If you've decided to establish a partner program in an industry you're already familiar with, or you’re targeting customers you've interacted with in the past, it can be advantageous to generate leads and pass them on to your channel partners for closing.
However, suppose you're venturing into a new industry or market segment. In that case, letting your new channel partners take the lead is advisable. With their expertise in serving a targeted customer base, your partners will excel in generating qualified leads independently, leading to higher success rates.
How do partners want to hear from you?
Determine how partners prefer to receive information and communicate with you. Whether through phone calls, video chats, newsletters, or social media, adapt your communication style to align with partner preferences.
Certain channel partners may prefer direct communication through phone or online video chat. In contrast, others may opt for a less frequent newsletter they can read at their convenience. Engaging through scheduled social media posts, monthly community-wide update calls, emails, or other communication methods may also be suitable.
By tailoring your communication approach to suit the preferences of your channel partners, you can enhance their experience and ensure that your messages stand out amidst the multitude of communications from other vendors.
Does the channel partner have an infrastructure in place to support your product or product line?
When forming your channel partner community and onboarding your first three or four partners, there is a temptation to accept any company that displays even the slightest interest in your product. However, it is crucial to thoroughly assess these companies to determine their readiness to become your partners.
Have you adequately evaluated whether they possess the necessary infrastructure, including personnel, technology, and resources, to support your product?
Is their billing system capable of processing and invoicing new customers?
Can their current team be trained to successfully sell your product, or will they have to hire additional staff?
Who owns the customer relationship?
One of the most contentious aspects of the vendor-partner relationship revolves around control.
On one side, you developed your product or service. Naturally, you want to ensure that the right marketing messages reach your target customers promptly and effectively. After all, as the creator, you possess the best understanding of the appropriate messages, timing, and sales tactics. Right? Not necessarily.
You likely decided to establish a partner program to gain expedited access to an existing customer base, many of whom have already purchased complementary products or services that align perfectly with yours. Your partners have established personal and business relationships with these customers, who trust their recommendations on future purchases.
Attempting to insert yourself between your partner and their client will hinder your sales efforts and strain your relationship with the partner. If they invite you to participate in a customer call, sit in on a video chat, or collaborate on a joint marketing campaign, that's fantastic. However, remember that your partner should be the one leading the way.
What is the alignment strategy for your product and their existing portfolio?
When considering a potential channel partner, selecting a company that already offers complementary products to your target audience is crucial. This provides your partner with several advantages:
They can cross-sell additional products and services to their customers, increasing their average revenue per customer (ARPC).
They can create a comprehensive portfolio of bundled products and services, giving them a competitive edge in the market.
They can enhance customer retention by increasing customer loyalty. Each additional product sold to a customer enhances their loyalty.
Investing time in onboarding a channel partner with an incompatible portfolio or a sales and marketing strategy that is out of alignment with yours is a futile effort.
How will you motivate a channel partner to sell your product over a competitor’s product they may also be selling?
Quality trumps quantity in sales.
Following the 80/20 rule of sales, where 80% of sales come from 20% of customers, a similar principle applies to your channel development strategy. The majority of your sales, around 80%, will come from a select 20% of your channel partners. By limiting the number of channel partners you onboard, you can provide better support to each partner, fostering closer business relationships and sustainable sales growth.
Capitalize on initial and ongoing training.
During the onboarding process, offering comprehensive training to your partner's sales and marketing teams is vital. Whether conducting in-person training at their office or conducting live Zoom meetings, establishing a formal training schedule that emphasizes initial and ongoing education is crucial. This ensures their comfort in selling and marketing your product, resulting in an exceptional customer experience.
Implement SPIFFs and sales incentives.
Salespeople are naturally competitive and thrive on recognition for their achievements. Creating a sales SPIFF / SPIF (Sales Performance Incentive Fund) or contest can motivate them to sell more.
You might wonder why incentives are necessary when selling is their job. Remember that your product is just one piece of a broader portfolio they sell. Your personal relationship with the partner, the support you provide, and the sales incentives you implement all work together to actively encourage the partner's sales team to promote your offering.Assist with marketing.
Smaller channel partners often lack internal marketing support. By offering marketing assistance such as customizable collateral, sales tools, digital marketing campaigns, and other resources, you demonstrate your commitment to their success.
Provide QUALIFIED leads.
Simply promising to provide leads regularly to your partner is insufficient. A list of 100 contacts who downloaded an e-guide from your website could include irrelevant “leads” like college students or fake names like Mickey Mouse. Expecting your channel partner to conduct outreach to this unqualified list is inefficient and ineffective.
Instead, leverage your team to prequalify leads, ensuring that the final list you hand to your partner consists of sales-qualified leads with a higher likelihood of conversion.
Step 4: The onboarding process.
Prioritizing your time, energy, and resources in an onboarding process that equips your partners with the skills to effectively market and sell your product is crucial. While the first 3-6 months are pivotal, the onboarding journey can span a year or even longer, depending on your product’s complexity. This timeframe serves as the foundation for their ongoing success.
All the resources you develop for partner onboarding and engagement should fall into two categories:
Resources for channel partners to enhance their understanding of your product as well as their sales and marketing efforts.
Resources for end customers that can be customized by channel partners to facilitate selling to their clients.
By making these materials and resources readily available, you and your partners can hit the ground running, significantly increasing your chances of success. Consider the following key elements:
A dedicated partner success team.
To ensure your partners' success, establish a dedicated team solely focused on partner success. These team members will prioritize onboarding—building strong personal relationships, understanding their unique sales processes, providing effective selling techniques, equipping them with any necessary skills, and assisting in marketing efforts. This may involve:
actively participating in sales calls or accompanying partners to joint meetings.
ensuring they feel comfortable reaching out to you with inquiries.
working closely with the customer service team to address customer issues promptly.
providing sufficient training to instill confidence when engaging with customers.
equipping partners with all the necessary resources to facilitate seamless selling.
By establishing a dedicated partner success team and fostering solid relationships, you significantly increase the likelihood of your partners' success and the overall effectiveness of your channel program.
Partner portal.
A dedicated partner portal serves as a secure online platform where your channel partners can access a wide range of valuable resources. These include training materials like slide decks and videos, marketing assets such as campaign templates, price lists, sales collateral, exclusive partner promotions, a lead tracking database, reseller agreements, and other tools to foster their success.
While a partner portal has become a standard feature in channel programs, it should not be relied upon as a crutch. Instead, you should view it as a tool that enhances the overall program.
Unfortunately, some vendors adopt a "set it and forget it" approach, assuming that providing a few training slides, sales collateral, and their company logo is sufficient to building and maintaining a superior channel sales strategy. If you are inclined to proceed in this way, your channel partners will not be successful.
While a partner portal can be an excellent resource, it is essential to recognize that it is just one component of a comprehensive channel program.
Customizable marketing materials.
Irrespective of whether your channel partners consist of small businesses, mid-size companies, or large enterprises, the availability of customizable marketing materials can prove highly advantageous to them.
The advantages for smaller channel partners include the following:
Utilizing vendor-developed messaging that has already proven effective in resonating with potential customers means they can go to market more quickly with proven sales messages.
Accessing professionally designed collateral, e-guides, case studies, online ads, slide decks, and other materials means they can use professionally designed sales and marketing resources that they would have been unable to produce on their own.
On the other hand, larger partners with an internal marketing team may seek to differentiate themselves by creating their own distinctive collateral or materials that present a unique blend of products to their customers.
In such cases, they may not be interested in utilizing your materials as they are. They may choose to incorporate your marketing messages into their own pieces. Doing this ensures the accuracy of the message while aligning it with their brand positioning and competitive differentiators, and allowing them to stand out in a competitive market.
Live training and support.
Arrange live training sessions (in-person or virtual) to deepen the partner relationship. Live training is considerably more impactful than pre-recorded video instructions. It will establish your company as a genuine business ally committed to their success.
Milestone and performance metrics.
As you bring each channel partner into your network, you must regularly assess their progress and achievements. Establishing formal metrics is crucial to gain insights into their development.
In the initial 60 days, these metrics could focus on tracking the completion of various training programs, attaining any necessary certifications, and successfully integrating your product into their sales, billing, and marketing systems.
Over time, the metrics may evolve or expand to capture additional aspects of the sales cycle. For example, you might measure their customer service effectiveness by tracking the number of customer service inquiries resolved on the first call.
You will also want to monitor the conversion rate of qualified leads into customers and request a monthly sales forecast from each partner's sales team member.
Consider the metrics you would traditionally expect from your own internal sales, marketing, and customer service teams. Although not directly employed by your company, channel partners are an extension of your team. They should be held to similar performance standards and milestone expectations. This alignment of metrics will help drive consistent growth and performance across the board.
Final thought.
Effective channel partner recruitment and onboarding strategies are essential for establishing successful business partnerships that drive sustainable revenue growth.
Considering that 75% of global trade occurs through indirect channels, there is a significant opportunity for you to establish a thriving partner network, and a thriving business.
By cultivating a successful business partnership built on shared values, insights, and goals, you can navigate change and overcome challenges, ultimately achieving sustainable, long-term growth.
