If you are part of a small company selling into a large market, you have faced the channel partner question.

The reality for a product-based company that tries to market and sell all on its own is that it’s hard to make a profit when footing the entire bill for your awareness-raising and prospecting. Instead of going after end-user leads completely on your own, it makes sense to go to those who aggregate the prospects & “channel” them toward you. Almost every market’s ecosystem uses a channel.

You won’t get to keep as much margin, but having partners can help keep the lights on in bad times. Partners can also help a small company seize a big opportunity that would be out of reach if they operated alone. Channel partners can find new applications for your product, even beyond the uses you think of. Partners can also bring the credibility that’s vital to getting an end-user to be the test case for that application.

In time, some partners become the best route to sales and vendors stop worrying about generating end-user leads and start designing programs that generate partner leads. But how do you pique a channel partner’s interest?

Campaigning for Partner Leads

business card leadsThe good news is that campaigning for channel partners is like regular lead generation: you may use a different kind of offer, but it uses the same kind of funnel. A good way to get ideas for partner lead generation is to ask your end-users where they would turn today for a product like yours – then go campaign in those places.

Go beyond firms who already know your products. Be open to untraditional partners who interface tightly with your end-users. When writing your “become a partner” web page, word it in a way that appeals to all comers – you may be pleasantly surprised by who approaches you!

Set up a vendor partner program that truly benefits the channel. Swivel over to a partner’s viewpoint and view your value proposition as your partner views it. Does it hold water? Does it let them diversify their product line for a larger share of client spend? Does it increase their revenues for the same cost of sales they currently spend, or possibly for less? How does the value of your vendor partner program compare to others they might look at?

As much as possible, try to segregate your channel-messaging from your end-user messaging. We’ve all seen Multi-Level Marketing (MLM) firms muddling partner messages and end-user pitches, saying “you should buy this” right beside where they say “make high profits by getting others to buy this.” You should give channel partner prospects and end-user prospects their own pages on your site. Speak to only one at a time.

Best Practices with Partners

channel partnersHave qualifying questions ready for partners, whether you put some in the “Partner Inquiry form” on your website or ask them later. Helpful ones include:

  • How much do you need to make on each unit sale? (tests the viability of partner pricing model)
  • What percent of overall revenues will our line represent? (the higher it is, the more top-of-mind it will be)
  • What type of territory coverage do you have? (# of salespeople, breadth of products they carry)
  • What’s your annual client turnover? (shows the strength of client relationships)

When you have a channel up and running, think of each partner as your client. You should think of end-users as clients too, but their relationship is mainly with your channel partner. As the vendor, you are still responsible after signing them up to deliver product as promised and to create end-user demand. If you write content about your product, leverage it by freely sharing it with your partners, who can use it to reach many qualified buyers.

How are leads doled out between your direct sales force and your channel partners? Set clear rules and commit to passing on leads which rightly belong to your partner; don’t be tempted to close the sale yourself. This poisons the channel, putting short-term gains ahead of long-term relationships, which can cause partners to lose faith.

“In a B2B market, don’t confuse channels with customers,” advises technology veteran Dave Curley. Even if your goal is 100% channel sales, keep selling to end-users, using them and partners in a virtuous circle, each one helping to attract the other. “Sell direct to validate the value proposition and [to prove] a repeatable business model.”