Is your Partner Program on Life Support?
- George Swiger
- Oct 1, 2024
- 7 min read
Session 6: Partner Program Health Check
This session focuses on key strategies for building successful relationships within a partner program. The discussion highlights the challenges and opportunities when working with partners. Key takeaways included the importance of carefully selecting partners based on factors like size, revenue, industry alignment, and willingness to invest in joint success.
The session helps to identify the indicators of why a partner channel is not performing at its maximum potential and how to address them.
It also touches on the challenges of having both a direct sales force and a partner channel as well as getting attention in a crowded marketplace, with traditional methods like cold calling and spam emails proving to be ineffective. Instead, building relationships through personal contacts and communities, such as IAMCP, is recommended.
Thank you to Brian Iinuma, President, IAMCP SoCal for this session review.
Why is it important to periodically assess the performance of your partner channel?
Periodic assessment of your partner channel's performance is essential to ensure sustained growth and alignment with your business objectives. Partner channels can significantly boost revenue, market reach, and customer engagement, but their effectiveness can fluctuate over time. Regular evaluations will help you to identify underperforming partners early, allowing you to address issues such as low engagement, misaligned goals, and inadequate training before they become problematic for your business.
By periodically reviewing performance metrics, you can assess whether your partners are contributing to revenue growth, expanding into target markets, and delivering value to customers. It also ensures that you’re working with partners who are the right fit, based on their ability to meet your evolving needs in terms of geographic reach, industry expertise, or technical capabilities.
Consistent assessments allow you to refine incentive programs, improve sales enablement resources, and resolve channel conflicts that may arise between direct and partner sales. This proactive approach strengthens partner relationships and ensures that partners are motivated to work toward common goals.
In short, periodic health checks serve to safeguard the effectiveness of your partner ecosystem and maintain your competitive advantage in the marketplace.
Partner Program Health Check
5 Signs of Trouble and What to Do About Them
For any business utilizing a partner channel to drive sales, growth, and customer engagement, the effectiveness of that channel is critical to your overall success. A well-functioning partner channel brings additional revenue streams, expands market reach, strengthens customer relationships, and enhances brand credibility. However, when a partner channel underperforms, it can erode these benefits and even harm your business. Knowing how to spot the signs of an underperforming partner channel and taking proactive steps to address issues early is critical for maintaining a healthy partner ecosystem and the financial well-being of your business.
Let’s explore five major signs that indicate your partner channel might not be performing well and suggest action to address these issues. Whether you're a business leader, channel manager, or partner development specialist, these key signs will help you to assess your partner relationships and make timely adjustments to keep your channel thriving.
1. Low Partner Engagement: A Warning Signal
The most common sign of a struggling partner channel is low partner engagement. When your partners fail to participate actively in joint initiatives or meetings, it shows a lack of commitment, which can result in poor performance. In a thriving partnership, both parties should be equally invested in growing the business. Your partners should be contributing ideas, offering feedback, and showing interest in shared business goals.
Why This Happens: Low engagement may stem from various issues, including:
Misalignment of goals: If your business objectives don’t align with your partners’ priorities, they may not see the value in investing their time and resources.
Lack of communication: Ineffective or infrequent communication can make partners feel disconnected from your operation.
Inadequate incentives: If your incentive program doesn’t adequately reward partners for their efforts, they may not have the motivation to fully engage.
How to Address It: To boost engagement, it's essential to maintain clear, consistent communication with partners. Regular check-ins, joint business planning sessions, and partner feedback loops can help you stay aligned with their goals and expectations. Reevaluate your incentive structures to ensure partners feel adequately rewarded for their efforts. Partners who feel recognized and supported are more likely to stay engaged and actively contribute to your mutual success.
2. Stagnant or Declining Revenue Growth
Revenue is the clearest indicator of channel health. If your partner channel isn't bringing in new business or showing signs of growth, it’s a sign of poor performance. Stagnant or declining revenue could mean that your partners are not effectively selling your products or services or they're struggling to reach the right customers.
Why This Happens: Stalling revenue can be caused by several factors, including:
Poor market positioning: Your partners may not understand your value proposition well enough to sell effectively.
Limited sales enablement: Without the right sales tools, training, or support, partners may struggle to close deals.
Partner fatigue: Over time, partners may become less motivated or enthusiastic about selling your products if they feel unsupported or see diminishing returns.
How to Address It: Invest in partner enablement by providing the right sales tools, training programs, and marketing support to help partners sell more effectively. Consider organizing product training sessions, webinars, or creating a partner portal where they can access resources. Clear performance metrics and success stories can also help reignite enthusiasm. Ensure that partners have the technical skills and industry knowledge needed to position your solutions effectively.
3. Limited Market Reach and Penetration
One of the key advantages of a partner channel is expanding into new markets or segments that would otherwise be difficult to reach. If your partners are not helping you grow into new territories or industry verticals, this may indicate a lack of alignment between your goals and their capabilities.
Why This Happens: Several factors could lead to limited market reach:
• Misaligned partner profiles: Partners who don't specialize in your target market may not be able to penetrate the right customer segments effectively.
• Inadequate geographic coverage: Your partners may lack a local presence in the regions you're targeting, limiting their ability to close sales.
• Insufficient marketing support: Partners may lack the marketing collateral, leads, or tools needed to successfully approach new markets.
How to Address It: Start by reviewing your ideal partner profile (IPP). Ensure you are working with partners who have the industry knowledge and geographic presence required to meet your market penetration goals. In addition, work closely with partners to create joint marketing plans that include lead generation campaigns, co-branded content, and promotional strategies tailored to specific industries or regions. Providing Marketing Development Funds (MDF) or other financial incentives for partners to promote your products in new markets can also encourage greater outreach and success.
4. Direct Sales and Partner Channel Conflict
A common challenge in partner programs is balancing direct sales with channel sales. When your internal sales team competes directly with partners for the same customers, it can lead to mistrust and friction within the ecosystem. This conflict can discourage partners from working with you, damaging long-term relationships and reducing your channel performance.
Why This Happens: Channel conflict often arises when:
Clear rules of engagement are missing: If your partner program does not clearly outline how and when the direct sales team and partners should engage with customers, competition for customers can occur.
Inequitable compensation structures: If your internal sales team receives higher commissions for direct sales than for partner-driven sales, they may avoid collaborating with partners.
How to Address It: The key to resolving channel conflict is establishing clear and transparent rules of engagement. This could include a deal registration program, which allows partners to claim ownership of a deal if they initiate it. Also, ensure that both direct sales reps and partners are compensated equally for channel-driven deals. By aligning incentives and fostering collaboration, both parties will be motivated to work together toward mutual success.
5. Lack of Training and Specialization
When partners lack the necessary skills or certifications to deliver your products or services, it can severely hinder their performance. If your partners struggle to implement solutions or don’t understand your technology well, they won’t be able to effectively meet customer needs.
Why This Happens: Partners often lack the necessary skills because of:
Insufficient onboarding: Partners may not have received adequate training when they first joined your channel program.
Lack of specialization: Partners may lack expertise in specific industries or verticals, limiting their ability to offer tailored solutions.
How to Address It: Offer comprehensive training programs that equip partners with the knowledge and skills they need to succeed. This could include certifications, product demos, technical training, and industry-specific insights. Additionally, consider implementing a tiered partner system where partners are rewarded with higher status and benefits for achieving specific training or sales milestones. This encourages partners to invest in specialization, be competitive, and stay committed to delivering the best results.
Conclusion: Take Action Early
A successful partner channel is essential for expanding your business, driving revenue, and reaching new markets. By identifying the signs of underperformance early—low engagement, declining revenue, limited market reach, channel conflict, and insufficient training—you can take proactive steps to address these issues. Strengthen communication, invest in partner enablement, align incentives, and offer specialized training to ensure your partner ecosystem thrives. Partner relationships must be built on a foundation of mutual benefit nurtured, enabling both partners to grow and succeed together.
IAMCP members can watch the recording of this session by visiting:
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Take the Next Step
Join us for IAMCP America’s Partnering as a Practice Masterclass #7: Partnership Activation on Thursday, September 26, 2024 from 8:00 AM to 9:00 AM PDT for an exclusive online event that will delve into best practices for making your partners proactive and self-sufficient.
Whether you're looking to boost partner engagement or streamline activation processes, this session offers invaluable insights and actionable strategies to elevate your partner program. Enhance your partner relationships and drive success by learning from the best. Secure your spot today and take your partnership strategy to the next level!
Registration link: https://www.iamcp.org/events/EventDetails.aspx?id=1856337&group=
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