In last weeks’ post I talked about 2 Common Gaps in Most Companies’ GTM based on the GTM Bridge shown in Figure 1 below. The first element of the Bridge was Solutions. Today we will look at the second section of the bridge – Channel GTM Programs.
Channel Programs are like Ogres – and onions. Of course this is a reference to the movie, “Shrek”, where Shrek is upset that that everyone thinks he is a stupid beast and are not able to look beyond his appearance to understand the sensitive soul inside…
Shrek copyrights owned by Dreamworks Animation
People take one look at me and go “Aargh! Help! Run! A big stupid ugly ogre!” …
They judge me before they even know me. For your information, there’s a lot more to ogres than people think…
Ogres are like Onions. Onions have layers. Ogres have layers… You get it? We both have layers.
The Ogre/Onion analogy is descriptive for channels because what you see depends a lot on your role and how well you understand what it takes to deliver value to customers and channel partners in a channel program.
The Outside Layer
As shown in Figure 2 below, at the top level, Executives and the organization as a whole tend to look at channels as a route-to-market, with specific sales dollars that translate to revenue. The channels have costs so you can calculate a “channel ROI”. The channel is a cost and it must yield an acceptable ROI, but for many technology vendors the channel also provides the only viable way to scalably reach some customer segments.
This layer of the onion is a critical overview and scorecard, but it does not yield much useful information on how for the organization can impact these metrics. To understand these drivers, you have to peel back other layers of the onion.
Figure 2: What is Behind a Successful Channel GTM? The Top Level Value
The Second Layer
Figure 3 below shows how a partner thinks about a channel program from a vendor. At the bottom of the circle they see an opportunity to create a deal pipeline and closed sales, but they have to evaluate this opportunity vs. the expenditure of resources by their company. As I’ve discussed a number of posts, channel partners want to know “What is in it for them? You can read more about this topic in the “Channel Not Selling Your Products” Series
- 3 Questions You Can Ask to Diagnose the Problem – #1 – What is the Value Proposition for partners to invest their time in selling your product?
Figure 3: What is Behind a Successful Channel GTM? What Your Partners See
The Third Layer
To really understand “What is behind a Successful Channel GTM, we need to look another layer deeper in the onion, to see the structure of a GTM program. Figure 4 shows this structure, which I call “The GTM Wheel”.
Figure 4: What is Behind a Successful Channel GTM? The GTM Wheel
Why is the wheel analogy useful for GTM programs?
A wheel has a hub that is the center of rotation for a tire and the hub has to be strong enough to withstand the weight being carried. The hub is connected to the tire by spokes and these spokes distribute the load. If you only have a few spokes, each spoke carries too much weight and the wheel collapses, so it is important that all the spokes be in place to transfer the load to the hub.
The GTM Wheel
For a channel GTM, the same dynamic holds between hub and spokes. Notice that the center of the GTM wheel is “Core Solutions” – meaning that the entire GTM is dependent on what solution you are trying to sell. If the solution is not well defined (and we’ve often talked about vendors selling product features not solutions and value), your GTM program will likely not be successful. I talked about the impact of poorly defined solutions on revenue in my recent post, 2 Common Gaps in the GTM Bridge.
There are number of elements of a channel GTM program that we can think about as them as spokes on the wheel. These spokes make sure the program is complete and can carry the load of the GTM. If we are missing a few spokes, the program cannot carry the load and you will not drive revenue for your products and solutions.
Below is a brief definition of the “Hub” of the GTM Wheel and the “spokes”. Next week, I will dive into each of these “spokes” and the critical success factors for the overall GTM Wheel in more detail.
- Core Solution – what are you selling that provides value to customers (not just your product features)
- Right Partners – Who are the right partners to sell this solution?
- Partner Value prop – Why should these partners care about selling this solution?
- Field Engagement Model – How will your sales and marketing team engage with these partners to create opportunities and create sales pipeline and closed deals?
- Right Skills – What sales and technical skills do partners need to sell this solution, and how will you help them gain these skills?
- Demand Engagement – How will you jointly generate a top of the funnel (Market and Sell) and engage with customers to close deals (and what role are partners expected to play?)
- Scorecard – How will you measure progress and success?
- Operations and Infrastructure – How will you support this GTM program so that it is easy to do business with your company?
Figure 5 below shows all three of these layers of a GTM Program “onion”. For a technology vendor to drive revenue through their channel, they need to see past the surface metrics to understand how value is driven through a channel, and develop a program that creates value for partners and drives revenue for the vendor.
Figure 5: The Three Layers of the GTM Program “Onion”
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