Enhancing Your Partner Relationships By Developing Your Partners’ Pipeline By LeAnn Castillo & Christopher Lower

In 2005 the number of marriages in the US that failed actually fell to only 43% (according to the US Census Bureau), yet the number of “Business Marriage” failures in the Channel Sales Category,  rose to it’s highest point of 50%, as reported in a 2005 survey by Gartner Research Group. 

This number of failed relationships is staggering when the same Gartner report stated that approximately 80% of Technology Manufacturers would be utilizing partners to distribute their products.  Companies are relying on these relationships to make and keep them profitable, yet it is a flip of the coin chance that you will fail or succeed with that partner relationship.  Is that a chance your company is willing to take?

What can be done to change the odds?  Like any good marriage both parties must be willing to work on the relationship regardless of which one appears to be at fault.

Channel Partners have two major complaints.  First is the lack of sales leads provided from the Technology Manufacturer, and second, is that they are not always offered the best competitive price, and will shift their loyalties as needed to get the better deal.

Technology Manufacturers also have a couple of major complaints.  They feel that the partners don’t spend enough time and effort on driving their product lines.  They also feel that the channel partner is relying on the manufacturer’s business development team too heavily for sales support. 

This creates a catch-22 for the technology manufacturer. On one hand, the manufacturer went into the channel sales to reduce sales costs. They planned for rapid growth, scalability, and access to the partner’s customer base, all the while outsourcing the sales efforts.  On the other, the partners are looking for sales support from the manufacturer’s resources leveraging expertise only found at the producer level.

To make this relationship last, both parties must be willing to work on the following key issues:  Alignment between the Technology Manufacturer and the Partner, Clear and concise Strategy and Communication planning, and joint investment in Sales and Revenue Building.  We’ll explain in further detail:

Alignment between the Manufacturer and Partner:
Partnering success is achieved by alignment of objectives and processes across both organizations. Aligning your business value systems includes understanding if the partner openly discloses information and gives feedback, creates trust through actions and words, resolves conflicts and solves problems, and has a clear vision of the future.

Trust in the partner relationship goes a long way towards building a basis where the partners and distributors will both feel good about the pricing and markups involved.  In a trusting relationship, loyalty can be built which may prevent partners from hopping form one manufacturer to another just to get the best price

Clear and Concise Strategy Plan and Communication:
The old adage “out of site, out of mind” definitely applies when growing strong partnerships. Communicate, communicate, and communicate. Just like in a marriage, open and honest communication is vital to a long-term, productive relationship.  A communications plan must be developed once the partnership is established to keep in front of each organization within the partner company in order to drive the agreed upon objectives to reality. 

Two-way communication is vital to creating the trust that is mandatory for continued success. Partners must know that their opinions and feedback are listened to and acted upon and the reasons for non-action are shared. By discussing with each partner the expectations, listening to their input and making appropriate modifications, shortcuts that are likely to cause delays, or bad deals, are avoided.

Joint investment in Sales and Revenue Building:
The Manufacturer needs to offer extensive support to all partners and the partner needs to participate in marketing plans that will impact revenue growth. The joint marketing plan can include; joint branding and value proposition, marketing collateral, incentive programs, technical and sales training, 24/7 technical support, and a complete channel sales kit which includes product information, pricing schemes, presentations and competitive analyses.

Providing leads or building the pipeline for the partner is a key element to insure both parties win.  Leads can come from several effective sources that can be worked on by both parties.  In an inside sales model, the partner’s database can be effectively marketed to by leveraging the Manufacturer’s Brand and the multiple tools available to reach prospects such as:  webcasts, podcasts, telesales, email, direct mail, etc. that can be jointly supported, or even handled by an outside agency.

By working together at tradeshows and events, the partner gets higher visibility, and a chance to get in front of more people.  The Manufacturer can support pieces like white papers, advertising, prizes, sponsorships, and keynote speakers, to help drive traffic to their site. 

This also holds true for Web Marketing Support.  The power of the brand can drive traffic to the website.  The partner needs to have a branded presence on the web, whether directly on the Manufacturers site or on a branded landing site.  This can enable the full utilization of webmarketing tools out there, from Search Engine Optimization to pay-per-click advertising, to RSS feeds, customized content, webcasts, podcasts, blogs, and other online sales tools and presentations.

As in all marriages, a happy medium must be found.  In order to improve the odds of partner relationships succeeding and to lift the sales numbers enabling all parties to succeed, there has to be a true partnership where both parties are willing to work together to see a relationship that lasts until the golden years.

It’s only appropriate that this article was written as a partnership:

LeAnn Castillo is a managing partner at New Leaf Business Development, a firm that is committed to helping companies build successful partnerships.

Christopher Lower is the executive vice president of operations at The Keel Group, a marketing and integrated lead generation firm specializing in the IT, software and high tech industries.