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Channel Marketing: The Era of Accountability A positional paper on the topic of business development among members of the high tech sales channel including vendors, distributors, integrators, and Solution Providers by Tony Serino, President; Serino Channel Services, LLC, a Channel Marketing Services Provider.
This paper explores how IT vendors and channel companies can implement
measurable and motivational joint marketing activities that result in
the desired outcome. These campaigns must not only motivate end customer
decision-makers to take action, they must also motivate the sales and
executive teams from all the participating technology partners to take
action.
Compelling the people at each business entity to seek a solution to
their business opportunities or issues forms the essence of a campaign
and the basis of its messaging. Ensuring that measurement mechanisms are
included within the campaigns and that measurable success criteria are
established during the planning process ensures that the outcome can be
objectively evaluated.
From Pennsylvania Avenue, to Wall Street, to the highways circling the
great technology centers, we are now in the Era of Accountability.
Business managers must be able to provide objective evidence of success
and quantify the results of their investments, including Market
Development Funds (MDF) used in joint marketing efforts. Calculating ROI
(Return on Investment) is now a very real part of their job description.
Michael Horsch Fizz, Senior Advisor at FCI and Premium Council Partner
at the Gerson Lehrman Group states, “From our sampling, IT spending in
the large enterprise has stabilized for now.
Q1 over Q2 09 forecast is a modest 3.14% growth. Average in the
past four years has been 7-11%. Present SI projects coupled with a
sudden increase in client RFI’s, RFQ’s and RFP’s indicate a flat Q3,
HOWEVER it also indicates we can be optimistic for Q4 2009.
Present data also indicates enterprise client IT spending will
continue to evolve away from product purchases and toward solution
purchases.”
The research indicates that there is a lot of need and opportunity in
the market for vendors and channel companies to address in tandem, and
that decision makers purchasing technology will be more interested in
solutions to their issues and opportunities as opposed to discrete
products. Human nature will cause all people to be receptive to hearing
about solutions to the matters that, both literally and figuratively,
keep them awake at night.
Fortunately, IT managers and business executives at mid-market companies
and global enterprises have business needs that can be resolved through
a combination of technical products and IT services. Making these
decision makers aware that solutions to their problems exist is only
part of the process in building and sustaining a robust new business
pipeline. Positioning a specific Solution Provider as the expert problem
solver using a vendor’s technology as an element of the solution takes
the process a step further. Staying in touch with the decision makers
until they have the budget in place and the initiative on their priority
list will result in the Solution Provider’s sales and technical teams
being in front of the right people at the right time. Having (or not
having) the measurement mechanism in place to keep track of the
opportunity and the stamina to persevere will result in notable
accomplishments (or lost opportunities).
We explore these matters further.
The business problems
The primary issues needing to be addressed by technology vendors,
distributors, and Solution Providers, both individually AND in
partnership with one another are:
… The Buck starts here; reaching the ultimate end customers…
Every IT product ever developed, every IT solution ever delivered, was
developed for an end-user’s use.
In the most basic sense, end user partner marketing is about
understanding the end customer’s business and reaching the right people
with insightful and hard-hitting messages that cause them to take
actions.
Comprehensive channel marketing solutions identify the target audience,
the specific need being addressed, creation of the solution messages and
campaign framework including media, messaging and measurement
mechanisms. In addition, it
deals with training and arming sales representatives with the
information they need to qualify an opportunity and close the sale.
Setting goals and measuring results against the goals allows all parties
involved to understand how success ill be measured and whether a
campaign is successful.
In the event that the ultimate sale is expected to occur via an
ecommerce site, those examples are not central to this document and will
not be addressed further.
Joint planning/Joint roll outs
“We must all hang together or most assuredly we will all hang
separately.”
- Ben Franklin c. 1777.
This patriot’s quote is an appropriate metaphor for planning channel
relationships and implementing channel marketing campaigns because “in
the channel” you win as a team. It is also appropriate because the
restructuring that was taking place in colonial America, threatening
livelihoods (if not lives) of the people, has similarities to the
upheaval that exists in high technology industry, including its channels
to markets..
When planning marketing campaigns cooperatively within the Channel it’s
essential that the programs are based on resolving the mutual needs.
Successful channel marketing campaigns are conducted among groups of
people each with differing and specialized skills and resources. If your
planning efforts exclude groups or individuals, and if those people are
central to implementation, you have weak links. When a plan is created
among people it is essential that they agree to it and to know and agree
to their role. All participants must know what to expect and what is
expected of them. They must understand that their success is tied at
least in part to the success of the corresponding partner peer … and
they will be held accountable to fulfill their responsibility. In other
words “… (they) must all hang together.”
Plans that do not include “buy in” result in a bunch of
disparate pieces and not the manifestation of an integrated whole. Plans
that do not motivate all parties result in ambivalence rather than
excitement.
Motivation
“Why should any person or company take part in business partner’s
campaigns? For that matter why should a vendor sales manager or rep
support the channel partner, or vice versa?
Too often we assign personal characteristics to inanimate objects or
business processes forgetting that we rely on people to complete certain
tasks … and form personal opinions.
People tend to do what they are good at, what they enjoy doing,
and what is of direct benefit to them. For
instance, we often here the words “I don’t trust that company.” The
correct interpretation is “I don’t trust that person.” Campaigns must be
built with the understanding and expectation that each involved person
will concentrate on “what they are good at … and that the ground rules
are clearly explained and will be followed equitably.” Theses criteria
form the basis of trust.
Here’s a very good bad example of a campaign expectation. Insist that
each sales rep enter every interaction or thought about the lead into a
CRM application. If it takes the sales rep about 3 minutes to record the
information (make sure you include log in time) … and that you expect
“about 30” discussions or data points worthy of inclusion to result each
day on average, realize that you have assigned 90 minutes of secretarial
work to that sales rep… You might not see it that way… I guarantee that
the sales rep will.
While every sales opportunity must be recorded and tracked … lacking
insight to a matter such as the one just described will serious hurt, if
not totally jeopardize, the entire campaign. And things EXACTLY like
this occur commonly, not so much that they are overlooked in traditional
channel marketing campaigns, but because the issue is not known to exist
because of the lack of understanding by the people planning the
activity.
A channel marketing campaign involves the cooperation of many people.
Each is a potential weak link capable of causing a program to fail. If
any person does not understand how they personally benefit there is a
high likelihood that they will be, at best, ambivalent toward the campaign
and their involvement.
So don’t ask yourself “What’s in
it for me?”, but rather “What’s in it for
them?” And to understand that
question, you first have to understand “Who
they are?” “Why is it that
they should care?” If you
cannot answer these questions in a compelling manner for each
person involved, chances are you just uncovered a point of weakness, if
not a point of failure in the planned campaign.
Then ask yourself, “Do they have all the tools they need to be
successful?” Do they understand their role? If not … who will get them
what they need?
How will you know when you succeed?
In the most basic sense success can only be measured by comparing a
result with a goal. If specific goals are not set a true understanding
of success cannot be gained.
Anecdote of a true, first-hand account: An end user account generated $2
million in new business for their employer, a technology vendor. I was
in the sales meeting where the sales representative and sales manager
were celebrating the success. Question, was that celebration warranted
given the fact that the same account purchased $500 million of similar
products each year from the primary competitor? Is getting 4/10th
of 1 percent of the available opportunity a success? Perhaps it is and
perhaps it is not.
What is the more successful marketing campaign, one that generated
twenty opportunities that resulted in $1,750,000 of new business, or the
one that generated one opportunity that resulted in $3,000,000 of new
business? It could be either, both or neither.
In neither example are you able to objectively analyze success because a
success metric had not been established as the basis for measurement.
So, when conducting partner marketing campaigns, set goals with your
partners and make sure each campaign does not end until the results are
analyzed … independently and with one another.
Why is this important, now?
The approach of the second decade of the third millennium presents a new
set of challenges for all businesses. Companies in the high technology
supply chain (closest to the end customer) are facing unprecedented
economic conditions. As such
EVERY manager will be FORCED by fiduciary responsibility, common sense,
and the desire to keep their job to know whether their investments are
producing the desired results and where and why they are not.
And results will be defined as
return on investment, in a very measurable and tangible sense.
Those who can document results
will be on the fast track. Those that cannot document results will be
forced to answer “why?”
Every marketing manager always has been understood to have fiduciary
responsibility within their job description when it comes to spending
marketing funds, however, in the past far too few were held accountable.
Further, the lack of accountability was accepted, overlooked or
subordinated … in the past. Today and for the foreseeable future “most”
people in Channel Marketing or Partnering roles will have their personal
well-being tied directly to “being able to produce and measure results.”
Executive and senior management will first request and then demand “Show
me the Money. Show me what I got for my investment?” Woe to those who
cannot fulfill the request.
Further exacerbating the issue is the fact that co-op, MDF, and other
type of joint funding or channel subsidizing programs will be at a lower
level than in any other recent time. As such each available unit of
currency must be made to work as hard as possible.
From Pennsylvania Avenue, to Wall Street, to the highways circling the
great technology centers, and even to the country lanes where embers of
technology innovations smolder, we are now in the Era of Accountability.
Business managers must be able to provide objective evidence of success
and quantify the results of each investment. It will be demanded of them
and is now a very real part of the job description.
It is as simple as that.
To learn more about how to build motivational and measurable channel
marketing campaigns that produce results, check out
www.channelsmarketing.BIZ
…
About the author. Tony Serino is the president of Serino
Channel Services,
LLC, a Channel Marketing Services Provider. He established the business
in 1993 and has worked with 110 unique technology vendors or channel
clients. Tony was Vice President of Marketing for Avnet’s computer
business unit. He’s had P&L responsibilities for a $24 million Solution
Providers and held Channel director roles at two ISVs. He can be reached
at
TonyS@channelsmarketing.BIZ or through www.channelsmarketing.biz Date changed: 05/19/09 |