If you recently invested in a channel management solution the good news is that you’ve taken a major step toward improving your business’ ability to manage its sales channel. However, that doesn’t mean it’s necessarily going to be easy.The bad news is that if not utilized correctly, this important platform is going to leave a lot to be desired. Here we outline the basic steps to successfully proceed.
Many companies use Customer Relationship Management (CRM) systems to coordinate and manage their interactions with customers. CRM software provides an excellent system for automating the sales process as well as storing and analyzing sales data. Although CRM systems are generally recognized as the best tool for managing direct sales, they do not provide an adequate solution for managing indirect sales partners (also known as channel partners).
Vendors who use indirect sales partners face a unique set of challenges because their relationships are far more complex. Channel partners are independent; they are not employees who are part of a direct sales force. In addition, they may be located in different parts of the country (or the world), making communication more difficult. And in many cases, they sell your competitors’ products. A loosely-managed indirect sales force can wind up competing with your direct sales staff – or other channel partners.
Any manufacturer that has built a successful sales channel knows that maintaining competitive advantage in the marketplace rests on the ability to evolve as an organization while adapting to the changing needs of their partners. This requires proper planning, consistent communication and an understanding of what it takes to build long-term relationships. A company’s ability to make good decisions on the path to building positive long-term relationships with its channel partners typically depends on the accuracy and timeliness of data from a variety of sources and systems.
We don’t only provide Partner Relationship Management software here at LogicBay; we understand the importance of professional services for a complete channel program. We work directly with our own consulting partners, as well as our established customer base, to understand best practices in channel sales and management processes. As such, over the years, we’ve come to learn a number of common mistakes among those selling through channel partners.
If you’ve been in the indirect sales game for years, you may have already learned some valuable lessons from - or navigated around - some of these issues. However, if you’re looking to expand or improve your channel partner support, we've compiled the following list to help you improve your chances for success.
There is a world of business opportunity out there, and it's available to more than just the large entities traditionally thought of as multinationals. Emerging markets are developing at a rate that provides plenty of opportunity for companies of all sizes to capitalize on this growth.
Of course, there's competition aplenty as well, and not just from American interests. Russian and Chinese corporations are particularly interested in these emerging markets, along with plenty of smaller players. The victors will be those who can build the strongest local ties backed by effective channel management support teams and systems.
In a perfect world, every sales channel would be a great performer... but this isn't a perfect world. In reality, any indirect sales ecosystem is going to have over-performers and under-performers. It's a familar adage: 80% of the performance comes from 20% of the channel.
One of the things that separates the truly great channel managers from all the rest is having the ability to bring the under-performers up to par. After all, most of the time simply eliminating the sales channel isn't a good choice. It's occasionally necessary, but should be considered a true last resort when, generally, working smarter to re-engage your channel partners will be a much less costly option.
This will almost certainly require some time and hands-on intervention, but when done properly, the right tools and strategies can help you breath new life into an underperforming channel program.
It's little wonder that as businesses expand and revenue targets increase, companies turn towards an indirect sales model for moving their goods and services. In the Internet age, there are no boundaries for consumers to be exposed to your line of products, but without local representation it may limit your ability to actually serve them. Channel sales simply make sense in a digital on-demand world.
Eventually the decision to build out an indirect sales channel of distributors, resellers, VARs, or dealers becomes an easy one. After all, well-implemented channel sales models have three clear benefits over most direct-sales models:
There’s a lot of buzz going around about how changes in buying habits are forcing changes in selling habits. It’s a pretty basic concept and it goes like this: as consumers, whenever we make a major purchase, most of us start by Googling it. We learn about what options are out there – we do our own research. We narrow the field of choices for where to buy – the local store if we want it right now, Amazon, or a favorite retailer online.
So when we get asked to solve a problem at work, we do the same thing. Why not? For millennials, there is no “change” in behavior – that’s the way it’s always been for them. Us older folks have a bunch of “I remember when…” stories. “I remember when you had to go to a store to rent a movie.” “I remember it was cool to have a calling card so I could use any pay phone to call anyone.” If you’re over 30, it’s a change in buying behavior. If not, that’s the way it’s always been. You don’t have as many “I remember when” stories. Sorry.
There are two things I’ve learned being a practitioner of inbound marketing for the last five years. First, it makes a big difference whether your marketing message is focused on satisfying a transactional need, or whether you are tending to the latent needs of your end customer through education. Second, inbound marketing – unlike traditional outbound marketing – introduces the unique ability to employ what I call an “agile marketing” strategy.
This requires actively listening to the data you can draw from your leads, creating a message that differentiates you from your competition, and making sure your products and services match their needs. The more latent your customer’s needs, the more you can benefit from agile marketing.
Channel partnering is on an upswing, with more businesses than ever before creating multiple partnerships across specialty and technological lines. Is your organization thinking in terms of what other companies can do for you... and do you have a channel management system that can make it happen?
We're living in an age of unprecedented change in business and technological sectors, with market shifts coming so rapidly that it's nearly impossible for any one firm to keep up. Even as a company becomes settled and comfortable with one set of systems, another leaps to the forefront and necessitates more changes to keep up with global standards.
(Just ask your CIO about the problems she has keeping the network modernized!)