Channel Marketer Report


10 Tips For Capturing Reseller Loyalty

Screen Shot 2014-10-28 at 10.41.24 AMBy Dan Hawtof, EVP, Corporate Business Development, Products & Solutions, parago

It’s no secret that getting your reseller partners personally invested in selling your products is good for business. But when parago conducted a recent survey of channel marketers, we found that only 52% of vendors are paying incentives directly to their partner sales reps. Instead, the incentives are going to the partner principal, who then doles out the incentives to the sales team according to how he or she sees fit.

So more than half of vendors are disconnected from the very people they need to connect with — the people with the power to increase sales. If you fall into this category (and even if you don’t), we’ve pulled together 10 tips on how to close this gap and get your channel program to start bringing in the results you want.

Tip 1: Build Reseller Awareness

Whether your primary relationship is with a partner principal or the resellers, you want to make sure everyone responsible for making a sale knows about your program and incentives. An incentive can’t work if no one knows it exists!

In addition to announcement emails:

  • Send direct mail;
  • Have your channel sales managers conduct personal recruitment drives; and
  • Send out or hand deliver posters for placement in a break room or other common work area.

Tip 2: Go Straight To The Source

Having a gatekeeper (the partner principal) between you and your resellers’ reps means you have little to no visibility into how well your program is working for end users — where it counts. Do the reps know about the incentives you’re offering? And when they do earn an incentive, are they receiving it?

Even if reps do know about and receive a particular incentive, they may get their reward so far after the fact that they have no idea what it was for. In that case, you may as well be throwing money away.

So instead of your program targeting the dealer principal, it should target the reps themselves. That’s the only way to guarantee they are receiving notification of incentive promotions, and to track their success.

Tip 3: Learn Who Your Reps Are

Building a database about your reps will help you tailor your incentives and your communications. The more you learn about their areas of specialization, levels of certification, what products their customers purchase most often, and what kinds of incentives are effective at motivating them to sell more, you can determine which incentives it makes sense to offer. And that helps you receive the highest ROI for the incentives you offer

Start gathering your data beginning at partner registration. This early in the process, limit your questions to basic profile information, like:

  • Name and address;
  • Email and phone; and
  • Social Security number and date of birth.

As your rep registers for different incentive promotions or interacts with other PRM modules, gather additional information as part of the process. Good attributes to collect include:

  • Reseller industry focus;
  • Product certification; and
  • Marketing activities run.

You can even offer small additional incentives for partners to fill out questionnaires that provide even more details.

Tip 4: Make Your Program Easy To Use

This may seem like a no-brainer, but too often I see channel program portals and communications that vendors are perfectly happy with, but are confusing or cluttered, or have valuable information so buried that it’s difficult to find. Remember that your reps may have 20, 30 or more channel programs vying for their attention and participation. The programs that offer brief, clear messaging and portals with intuitive navigation encourage registration and participation. Bottom line: Keep it simple.

Tip 5: Look To Top Performers For Inspiration

In a recent article, “Maximize Channel Partner Engagement: Identify And Incent Non-sales Behaviors,” outlined how to use your top-performing reps as a yardstick for determining which non-sales behaviors to focus on incenting. If your top performer always takes the latest product training courses, for example, then you know your courses are effective in helping him make more sales. Therefore, you want to incent other resellers to participate in the training, too.

As you zero in on the behaviors you want to focus on incenting, you’ll be able to determine which incentives aren’t netting the results you want. Those are the ones you can drop — again reducing the cost of operating your program.

Tip 6: Make Sure Your Incentives Appeal To Average Performers

For a program to be engaging, the average participant has to be able to attain your incentives. If resellers feel that only over-achievers will be able to benefit from your program, you won’t get the level of participation you want.

Your goal is to turn the average performers into top performers. So engage them by giving them an achievable goal, plus the tools and the resources (e.g., training, insights and best practices) to do even better over time.

Tip 7: Don’t Neglect Your Superstars!

A sales superstar is obviously a highly motivated person. That motivation may be internal for some, and external for others, or a combination of both. Those who are externally motivated are energized by competition and compelled to push themselves if a large incentive looms before them. So while you keep your incentives attainable for all, you definitely want to sprinkle in a few for your top sellers to keep them engaged.

Tip 8: Offer The Rewards They Want

For a reward to be motivating, it’s got to be desirable. Over and over again at parago, we’ve seen that cash — particularly when delivered on a prepaid card — is the number-one chosen reward. Merchandise and travel run a close second. There’s no one-size-fits-all reward scheme, but if you provide a wide variety of incentives, and can target them based on factors like program tier and previous performance, you’re on to a winning formula.

Tip 9: Use A Flexible Platform That Can Stack Incentives

A flexible program platform will let you target rewards to different partner roles and desired behaviors, and change your incentives as business needs evolve. To encourage the right partnership behaviors and build loyalty, you need a platform that can not only incent a single sale or a single behavior, but also stack them when appropriate. For example, if a rep is certified, registers a deal and then closes it, they get an incentive for the sale, plus a bonus for being certified and registering the deal.

Tip 10: Pre-Test

Before you launch a revamped program, consider pre-testing it with a limited rollout to selected partners. Pre-testing will allow you to evaluate the program across a number of key areas:

  • Program perception — note how well your partners are embracing the program by monitoring participation level;
  • Program efficacy — compare the sales of program participants to those of non-participants. The delta will allow you to better forecast outcome versus cost on a broader scale rollout; and
  • Evaluate administrative processes — identify and correct any bottlenecks before a full rollout.

As you look over this list, know that you don’t have to implement all 10 at once. If you’re just beginning to design a program, then keep these suggestions in mind as you build it. But if you’ve already got a channel incentive program in place and just want to improve it, prioritize the list in a way that makes sense for your business. Then start to plan a development and implementation schedule.


Dan Hawtof is parago’s EVP, Corporate Business Development, Products & Solutions. For more than 25 years, he’s been involved in almost every aspect of the channel. He’s been affiliated with large enterprises and small startups, working in every department, from sales and strategy to product marketing and management, and more.





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