I recently attended a webinar by a consulting firm on how to optimize the lead waterfall and I was interested in seeing how they dealt with the nuances of working with a channel. They discussed the very real issues regarding lead rating, qualification and follow up, system challenges, and the lack of marketing skills in many channel partners, and they outlined some best practices.
What they did not talk about was that for many channel partners, leads just don’t play a very big role in their business model – so it is any surprise that they don’t market the way vendors want…
- Every tech vendor starts from a point of zero penetration and has to build awareness and start customer conversations with accounts that are new. They hire Reps that know the local customer base, but a Rep only has so many accounts and relationships – and they need to continuously add customers to grow.
- On the other hand, a mid-sized channel partner often can build a strong business selling 80% of their business into 5-10 accounts. They try to sell more to these customers and develop profitable services to support product sales.
What does that mean about the relative role of marketing and sales in the channel, and for tech vendors?
- Many channel partners are “sales-driven” and rely on their sales reps and SEs to have customer conversations to create new opportunities. That approach can work quite well for a reseller/integrator that is more concerned with depth of penetration at a few accounts (products from multiple vendors and their services)
- While many tech vendors are also sales driven, it is too expensive to sell a few products into many new accounts without marketing air cover. A vendor’s field team simply has to have some qualification process before they spend time trying to sell into an account. Vendors often use inside sales to help in this process but they also need filters to make their selling cost effective.
A nuance of this situation is that while a specific customer in a territory is often “whitespace” for a particular vendor, inevitably that customer works closely with one or more of the vendors’ leading channel partners. That is why it is common practice for tech vendors to do account planning sessions with their top partners – to identify where a partners’ relationships can help get the vendor “in the door” to sell their offerings. Which puts a different spin on best practices for new customer acquisition…
Table 1 below shows a more detailed description of how vendors and channel partners differ in their business models, and the relative roles of sales and marketing.
Table 1: Sales and Marketing for Tech Vendors and the Channel
(Double Click to Enlarge Graphic)
Measuring the Impact of Channel GTM Campaigns
So how should vendors plan and measure GTM campaigns to drive sales of their solutions and products? Figure 1 below provides an overview of a best practice approach. You should certainty measure lead to close in the traditional way shown in the top section, The Marketing Waterfall. But you should also measure the sales pipeline and closed deals that are “sales and channel –driven” opportunities.
Figure 1: Measuring GTM Campaign Impact for Channels
Let’s look at an example of “sales and channel-driven”. Your company has a new solution for software-defined storage. You develop a GTM program that includes training your sales team and your channel on the solution, and includes an incentive to sell more of this solution now. What you want to have happen is that your partners say to themselves, “Hey, this is really great, I should make sure I introduce this to my account next week when we meet” (the meeting may be on a different topic, but he can position and qualify based on his relationship, and hope to set a follow up meeting). This discussion may lead to a new opportunity and closed deal, and demonstrates value from your marketing program – but notice that there were no “leads” involved.
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