Are Tiers & Levels Right for Your Channel?

By Ellen Linkenhoker, Channel Partner Solutions Lead, ITA Group

In two previous ChannelViews, I talked first about ways to determine if your channel program tiering and levels are still relevant. In the second part of my three-piece series, I looked at how segmentation of partners, instead of tiers, allows for personalized channel programs.

In this third ChannelView, I’d like to offer some suggestions on how you can determine if tiers and levels are right for your channel program. Or should you be thinking about transitioning to a segmentation model?

Traditional tiering has its benefits. Tiers and levels work well for product resellers. These partner types represent the brand, put products in customers’ hands and help reach new markets. Program tiers are an easy way to manage straightforward investment levels based on reseller revenue and profit.

If your channel is only reselling, tiers can be a great option. But if indeed your channel ecosystem has been expanding to include a broader mix of partners, you may want to rethink your program. Use the questions below to determine how complex your channel ecosystem currently is. You might find there are additional partners you need to account for.

Self-Assessment: Should You Reevaluate Tiering?

• Do you have partners in your channel ecosystem who aren’t traditional resellers?
• Are resellers supporting renewals, cross-sells, upsells or maintenance?
• Do different roles inside partner organizations support the sale of your solutions?
• Are you working with resellers that serve vastly different markets, buyers or industries?

If you answered “yes” to any of the questions above, tiering might not make sense for your channel program in the future.

If you have more than one partner type in your program, then there’s a good chance the tiers and structure you currently have in place aren’t able to support additional audiences, roles and partner types. The tiers could be limiting your ability to communicate your program’s value to new recruits.

On the surface, tiering seems like a valuable tool, and the goals of easily managing and prioritizing partners are good things to strive for. However, as you dig deeper into how traditional tiering works you may find it inadequate for more complex modern channels. For these channels with a lot of role variety, it might be time to move away from tiering.

Making The Move Toward Segmentation

Here are three examples of how ITA Group uses data to support channels as they move toward segmentation.

Journey Mapping — Clearly define where to update and re-align your partners’ experience based on their work and your understanding of their current path within your programs. Use assessment, research and documented visuals of their paths.

Discovering New Intel — Know exactly how partners and internal teams feel about your channel program and what matters to them moving forward. Use expert-designed surveys, focus groups, interviews, studies and bespoke research.

Gathering Competitive Intel — Learn where you might be losing market share or fighting to keep up with competitors. The right mix of research on competitors, buyers’ journeys and customer segments will show how to evolve, innovate and invest in your program.

Key Considerations

Once you’re ready to shift away from tiering, segmentation is a valuable alternative to structuring your program (check out that article here). A few other considerations are:

Technology — Determine if your current technology can sustain this type of change.

Timing — Be aware of the timing for the changes you’re making. How quickly you make changes depends on how partners feel about the current program.

Reputation — Focus on where to improve the partner experience while maintaining elements to keep partner relationships and reputation top of mind.

Resources — Crunch the numbers! Make sure you model the impact of these decisions, investments and financials.

Communicating — When you’re ready to make changes, you must over communicate. Share your message early and often. Explain how you decided on changes, when you’ll implement them, and what they mean for partners and your internal stakeholders.

More in-depth suggestions and recommendations are available in our whitepaper available here.

Shoot me a note if you have feedback. I’d love to hear it.

Ellen Linkenhoker is the Channel Partner Solutions Lead for ITA Group. She drives the insights, strategy, and evolution of their channel solutions while offering advisement for client engagement and incentive programs. She’s worked as a practitioner in technology, software and service companies both as part of the channel and as a vendor. She is an award-winning marketer and navigates all things channel, marketing, incentives and engagement in her role with ITA Group including pioneering thought leadership on channel partner ecosystems and the partner experience.