Are you winning the battle for partner mindshare?
August 5, 2021
If your business is like many, you’ve been engaging in more partnerships than ever. You may be looking to partners to play diverse roles in helping your business reach new markets and create new revenue streams. It’s all about creating more complete solutions to meet customers’ needs. In fact, in a recent Accenture survey, 57% of partners told us those solutions are the biggest benefit of collaboration.
But along with the benefits of partnerships, you may also be experiencing a common byproduct: channel conflict.
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75%
Of partners are concerned about conflict when selling products and services.
80%
Of partner are more likely to recommend a company’s products when channel conflict issues are addressed upfront.
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Channel conflict usually emerges in one of two forms. Either your direct sales rep is pursuing the same prospect as one of your partners, or two of your partners are chasing the same deal. Unfortunately, these conflicts have often escalated as the pandemic pushed all sales and customer engagement to a digital environment. In fact, Accenture research found that three-quarters of partners are concerned about conflict when selling products and services. The same Accenture study found that partners are 80% more likely to recommend a company’s products when channel conflict issues are addressed upfront.
Clearly, your partners are important, and potential issues are top of mind for them. In many ways, reducing or preventing channel conflict goes back to being brilliant at the basics of channel management.
Here are three checkpoints for assessing your current performance and opportunities for improvement.
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Being clear about your goals makes it possible to identify the right types of partners to achieve your company’s strategic vision.
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Channel checkpoint 1: You’ve identified how you want to leverage channel partners.
Are you aiming to scale sales by driving the breadth and scope of services offered to customers? Are you working to break into a new geographic or vertical market? Or perhaps you’re pursuing new offerings tailored to unique customer needs and requirements – whether for automotive, financial services or software customers?
Being clear about your goals makes it possible to identify the right types of partners to achieve your company’s strategic vision. Partners come in all shapes and sizes – from individual insurance agents to large automotive dealers or multinational systems integrators who resell, influence enterprise customer buying decisions and build solutions that enhance a company’s core products or solutions.
By being clear about the types of partners you need, you can ensure you have the right portfolio of partners to support your desired business outcomes.
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Channel checkpoint 2: You’ve articulated the roles you want partners to play.
Once you know how you want to use partners, have you been clear about the roles you want those partners to play? Be sure to create (or maintain) a clear line of communication between your company and each channel partner. Let them know your expectations in terms of what they can sell, which customers they can pursue and how they should act when representing your business. This should also include clear instructions about which of your products and services they should NOT sell.
In the past, a “hard deck” was used as primary tool for managing conflict. A hard deck delineated the set of strategic major accounts your direct sales force owned. These were accounts you didn’t want channel partners to sell to. In short, the hard deck made it clear where partners could hunt and what was off limits. Other companies offer partners captive markets with exclusive rights to a geographic region, thereby limiting access to others.
Clear rules of engagement between your company and your partners are key to a long term success. Delivering optimal outcomes enabled by the combined capabilities and skills of your company and channel partner.
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Channel checkpoint 3: You’ve rolled out channel programs that align with your goals.
You have clarity around how you’re going to use partners – and you’ve clearly informed partners about their roles and opportunities. Now you need to make sure your channel program aligns with those goals – and makes it worth the while for your partners.
Design (or update) your channel program so that it drives the necessary partner behaviors in concert with your channel strategy. The dynamic between your company and your channel partner “gives and gets” plays a pivotal role in enabling innovative capabilities and investment. So be crystal clear on channel program definition, roles and responsibilities.
The channel program should recognize the value a channel partner provides to an organization, including geographic coverage, industry expertise, differentiated solution offerings, incremental transactional sales and service offerings. Roles and responsibilities in the program should reinforce the behaviors. With each deal, partners should understand what role they’re playing (or not playing).
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Start channeling success
Use these channel checkpoints to help build and re-energize a trust-based partner ecosystem. If your partners can bring the best of their organizations to your customers, everyone benefits – including your business. Accenture has observed that when organizations effectively address channel conflict, partner satisfaction improves by more than 25% – and individual partner revenue increases by 10% to 20%.
