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How to Motivate a Channel Partner

A reader writes:

I'm an account executive for a high tech company who sells through a network of partners/resellers. Do have advice or mistakes to avoid when dealing with resellers ? What is the best way to have them commit for my company instead of my competition? How minimize the conflicts?
Excellent questions. Here' s the recipe for success in channel sales:
  • Step #1. Understand the Relationship. You are using a channel because you want the channel to carry the cost of sales, while the channel wants you to minimize their sales costs by getting you perform services for them. Because your agendas are different, you must craft a relationship that makes sense and works for both firms
  • Step #2: Limit the numbers. It's a big mistake to recruit too many channel partners. It's not true that the more channel partners you have, the more they will sell. When you have too many partners, you can't support them adequately and they'll start competing with each other and may even create a price war for your product.
  • Step #3: Create joint ventures. Create a relationship that takes into account the resources that both companies can bring to bear in order to make the relationship successful. You will need to invest resources in training, marketing and sales support, while the channel must commit resources to training and actively promote the solution within its target market.
  • Step #4: Get team consensus. If you sell your products both through direct sales and channels, you'll need to keep the two groups from treading on each other's toes. If the direct sales team sees the channel as competition, you can end up fighting a price war with your own product as each group tries to undercut the other.
  • Step #5: Target your markets. Figure out exactly where your product is most likely to sell and what kind of person or organization can sell it most successfully. The more you understand your custoemr base, the easier it will be to ensure that the channel focuses on the customers who are most likely to generate revenue and profit for both you and your partner.
  • Step #6: Recruit a top manager. Most firms assign a low-level drone to work with the channel. Wrong. Channel managers need to be heavy hitters so that they can influence and direct channel strategy and behavior. Be sure you treat channel managers well, or they could end up working the partner's issues inside your firm, rather than the other way around.
  • Step #7: Train, train, train. Channel sales training must go beyond the sales training that you would normally supply to a direct sales force. Your channel partners' sales reps will need top quality selling tools, such as competitive data sheets, sales scripts, selling videos, testimonials as well as the usual brochures and specification sheets.
  • Step #8: Support, support, support. If the channel partners are using your product in new ways, such as customizing it for a particular industry, they'll need MORE support than your direct sales force. Frequent and ongoing communication is vitally important to the health of a channel relationship.
  • Step #9: Provide cool incentives. While your partner's sales staff may already be well compensated, they'll be far more likely to sell your product is they feel that there's "something in it for them." For example, you might give a channel sales rep credit towards a personal purchase for attending a regional training session.
  • Step #10: Spend some money. A good way to ensure channel loyalty is to help with the channel's marketing efforts, such as through joint funding of advertisements. However, don't just throw money at them. Be sure that there's some way to measure the impact of the money, through higher sales of your product.
  • Step #11: Feed them hot leads. 'Nuff said.
READERS: Did I miss anything here?

By the way, as I look at the list above, it occurs to me that most of that stuff is exactly what companies ought to be doing for their direct sales force.

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