Subscribe

CMOs Challenged With Revisiting The Profit Potential Of Channel/Partner Programs

  • Written by Terry Moffatt, Editor, Channel Marketer Report
  • Published in Industry Insights
Featured CMOs Challenged With Revisiting The Profit Potential Of Channel/Partner Programs

While the communication gap between direct sales and marketing organizations appears to be closing, partner programs have yet to win much support from many CMOs.

That could be a problem for many of the large and small businesses that are counting on partner organizations to drive more of their revenue. Start-up firms, in particular, are opting to drive revenue through partner channels instead of building out their own sales teams.

For example, start-up companies participating in the 2017 MIT Sloan CIO Symposium’s Innovation Showcase said channel partners will play a key role in the sales and marketing of their products. They cited a variety of reasons for embracing indirect channel strategies, such as the ability of specialized value-added resellers to penetrate market segments or industries.

Last year, Rob Spee, Global Channel Director at SAS, blogged that he noticed that the 100% channel strategy is accelerating, driven by several market forces. “The digital transformation of technology is driving a transformation in the channel with partners either migrating to the cloud or being ‘born in the cloud,’” he wrote. “It’s also a major driver of the new way that customers buy technology, and in turn, how vendors view the channel.”

Still, many channel programs aren’t getting the attention they deserve from CMOs.

What’s The Problem?

Because most partner organizations tend to report up to sales, a couple of management layers can inhibit collaboration with marketing, said Jen Spencer, VP of sales and marketing at SmartBug Media. “I see a massive gap between corporate or direct marketing organizations and channel teams,” she said, adding “there's a huge need for channel teams to interact regularly with both marketing and customer success organizations.”

ADVERTISEMENT
Chris Becwar, VP of Client Success at Webinfinity, commented that the fast-changing partner landscape is one reason why CMOs aren’t fully engaging partner organizations. “The increasingly complex structure of partner channels makes it difficult for CMOs to understand them,” he said in an email. “Because a company's typical partner ecosystem has become more complex, with many more types of partner players supporting it than the classic VAR-distributor-retail model, CMOs are more unclear about how to go about this.”

Referral agents, managed service providers, alliance partners, consultants, etc. all need personalized support and touches, he added. “Luckily, modern partnering tools have made huge leaps in the last couple years in their ability to provide personalized experiences and support for a wide range of partner scenarios.”

“We find that most CMOs, given the scope of their roles and demands on their time, often don't become very familiar with channel partners,” Becwar added. “They also tend to find themselves pulled into the middle of the competitive dynamic that tends to exist between the direct and indirect sides of their organization. Since the direct channel sits within the four walls of their organization and rolls up to the same CEO, they tend to be the 'squeaky wheel that gets the grease.'”

As a result, CMOs often fail to comprehend both the revenue growth upside of investing in their partners' success, as well the financial risk inherent in not properly engaging and supporting them. 

How CMOs Can Become More Channel-Centric

CMOs need to start thinking about their company's channel partners as extensions of their own teams and marketing efforts, according to Spencer. But, she cautioned that this requires tight synergy at the executive level. 

“The first question is whether sales leadership is ready to make the leap,” said SAS’s Spree in an email. “If so, then sales needs the marketing organization to develop channel marketing support. When a company has been selling mostly direct for many years, that direct mindset is deeply embedded throughout the company in all departments. Getting the CMO and the marketing organization to adopt a channel mindset can be a challenge.”

For CMOs who do indeed recognize that supporting channel partners is vital to the success of their companies, boosting communication with them is the first step.

“If partners are encouraged and enabled to participate in the feedback loop of reviewing provided market-through campaigns, relaying effective best practices through execution and having their voice folded into the conception of future strategies, CMOs or marketing directors will become more aware of what is working or not,” said Chris Field, WW Director of Marketing Software & Services at Zinfi .

Having partners communicate their pain points, gaps or results through CMMs or CAMs to the marketing heads will offer a platform on which to create better strategies, he added.

Listen Up

Field recommended holding regular forums with partner groups to get feedback on portal capabilities, for instance, to find out what weak points are hindering usage. Partners will only use a portal and the tools in it if the UI and UX are something they feel comfortable with and can easily understand.

Becwar suggested that CMOs go through the process of developing partner personas to better understand them. “Over the last few years, we've found that CMOs have adopted the religion of deeply understanding and socializing their buyer personas, but are only now starting to realize the importance of understanding and operationalizing around their partner personas,” he said.  “CMOs that really get this and use the right tools, people and processes to achieve it give their companies a major advantage over their competition that is hard to erase.”