For businesses today that are striving to increase their revenues with limited marketing resources and at the same time remain competitive, deploying an efficient Channel Partner strategy is becoming crucial. A good and workable channel partner strategy is beneficial to both vendors as well as the partners. The five factors that need to be considered in order to make the relationship between the Channel Partner and Vendor a valuable one include:

Identifying a suitable Channel Partner and appointing them: It goes without saying that it is necessary to do thorough research on a prospective channel partner before you bring them on board and some of the factors you need to consider are: The market it is serving, existing customer base, the networking tools used, marketing strategies deployed, other analysis like any competition organization among its existing customers, etc. Moreover, factoring in the channel partner’s long term commitment to the vendor’s business goals is crucial. This first step rightly taken will benefit both parties in the long run.

Adopting target-based incentive-based program: Often, businesses work with multiple channel partners and there is rarely a case of exclusivity. So, it becomes very critical to occupy a larger proportion of the mindshare among the various partners. Research reveals that rewards and incentives heighten interest among channel partners about the vendor’s offerings and have produced great results in terms of sales, strengthening the bottom lines of the vendor and the channel partner. Constant support in terms of marketing collaterals, sales as well as technical training, besides any other relevant content have to be provided to the channel partners.

Equipping Channel Partners for profitable vendor relationships: There is no doubt channel partners are definitely an extension of the organisation’s sales team. At the outset, it is important to identify the top performing as well as loyal partners and keep them productively engaged through effective, running (functional) and dynamic relationships. Some measures include periodic events like going for an offsite, incentive-based loyalty programs, rewards and recognition programs, social media engagement like having dedicated pages on channel partners, sending out periodic newsletters to them on an ongoing basis, among others. However, in some cases, the ROI with certain channel partners is drastically lower than expected. Therefore, it is critical to increase their operational efficiency while partnering with them.

Relationship building with Channel Partner Community is Key: Increasingly, businesses across industries see channel partners as important links to both employees and customers. The performance of the channel partner is directly proportional to the brand’s reputation as it is dependent on the sales volume as well as percentage gain in market share, irrespective of a highly appreciated product or service offered by the vendor. It is always profitable to remain on the top of the channel partners’ priority list. For most vendors who deploy channel partners for all their sales, the old 80:20 rule applies ie. 80% of the business is delivered by 20% of the partners, thereby engaging the key ones is definitely a gain. At the same time, one should look at the 80% of low-delivering channel partners as an opportunity to profitably engage them as well.

Creating the right Channel Partner Ecosystem: For a harmonious functioning of the Channel-Partner Ecosystem, businesses should constantly ‘think’ like the partner and empathize with them. Deploying an effective Channel Partner strategy and having employees as touchpoints to partners will build and promote the desired Channel Partner Culture, thereby avoiding common pitfalls. During different stages of the partnership lifecycle–onboarding, upgrading their level of engagement or ongoing maintenance–specific engagement strategies should be adopted for long-term partnerships. Additionally, vendors should recognize the fact that different channel partners need to be motivated differently in order to achieve great results.