To clarify, they usually do not have a reseller relationship and their rewards for participation come from commissions or fees paid on closed sales.  They enjoy greater recognition through affiliation, access to SDK and/or NFR and now.. open participation in a lead rich community.

Today I plan to show you why these nuggets of pure gold should play a greater role in your diversified partner portfolio and share some tips with you on best ways to find and manage them.  I should also point out that while this methodology works in hardware centric channels; because of the expertise and services laden opportunities, it’s far more effective in the software and services industry.

How they add value to your channel:

1. Trusted advisory position – Often asked to evaluate options and recommend products to their customers.  Decision makers.
2. Low demand on sales and marketing resources – Independent lead generators and easier to manage.
3. Self serving motivation – Driven by services opportunities resulting from implementation, training, integration and support of your product.
4. Fast and easy on-boarding – Just need to know how to spot opportunities and initiate sales process with vendor assistance.
5. Broad and deep industry reach.
6. Margin based discounts do not exist – No VAR discounts for greater profitability
7. Can align with Direct Sales Force or Partners to add unique skill set and niche or compliancy expertise.
8. Open doors and penetrate targeted strategic markets.
9. Expansion of product presence with SDK integration and OEM consideration.

These types of partners tend to be more gregarious and less suspicious of one another than highly competitive VARs.  They generally flock to larger groups or associations where they can share their expertise and meet with other knowledge experts.  Find them at their watering-hole.

For example, a recent successful effort involved establishing an Expert Advisory Council and placing an ad on another well known industry expert’s blog page seeking council members to participate in our open community of customers, vendor support staff, partners, 3rd party vendors, advisory council experts and prospects.  Dozens of qualified experts entered our community weekly and quickly joined in on discussions and product Q&A while completing the minimal on-boarding requirements to receive $1,000′s in NFR software and gain access to our project/jobs posting forums where our customers could seek and acquire project specific expertise from our qualified and approved partners.  In the future there are plans to add a rating system similar to eBay reviews along with expanded Bios and an online store for SDK developed products and phone apps.

Access to our partner portal gave them a place to complete the required opportunity registration forms (the only way to cash in on their referrals) and download marketing material.

This level of vendor/partner/customer interaction was unachievable before social media, and other collaboration software; and frankly, much effort was made to keep our partners and customers separated for fear of account poaching or unfavorable comments.

Social Media provides us with a venue for reaching and managing 100s of referral partners in real-time and interactive ways that a monthly newsletter or mass emails could never achieve.

Think of the last time that you made dozens of prospecting calls a day to finally speak with one VAR.  Weeks of demos and discussions to sign that VAR.  Months to train and on-board that VAR.  Hours of meetings to complete a business plan and marketing initiative.  Repeated calls to the VAR to check status of efforts and then close their first deal at 20-30% discount.

What are your 2012 plans for partner recruiting and management?  How does your social media strategy help you grow and manage your partner community?

The new “Channel Society” group at Linkedin is an exciting forum open to all IT Sales, Marketing and Channel stake holders.

Whether you’re a veteran social media expert with wisdom to share, a channel manger looking for new ways to capture and hold your partner’s mind-share or a social-curious newcomer seeking an inspirational and bubbling fountain of knowledge – we’re eager to meet you and learn together.

Get a jump start on your 2012 business plans with a virtual room full of experts and industry peers who all share your passion for getting the most out of all that Social Media can do today and help us map the road to tomorrow at The Channel Society.

“The vendor called me everyday and night until I signed their partner agreement, and I haven’t heard from them since”

15 to 20 years ago, when new signed-partner quotas were the #1 objective on most Channel Manger’s MBO’s list and there was a virtual bounty on mirror-foggers, it was common to hear this abandonment lament; then, as the overwhelming numbers of unproductive partners began to clog the vendor’s sales and support systems there was a culling of the channel herd with increased focus on the “20″ of the 80-20 rule.  Partner quality and manageable productivity over quantity remains the goal of most of the larger and maturer vendors today

But not all of today’s vendors meet these legacy standards and we’re seeing a modified return of this behavior that does not necessarily involve actual abandonment, but the results are the same.  What’s happening now is that the marketplace is saturated with new ISVs popping up like mushrooms following a rain storm; and they’re eager to bring new partners on board without any idea how to help them be productive.   Whether abandoned or poorly on-boarded, the results are the same – poor performance, loss momentum and eventually, product apathy.

95% of a new partners’ first sales will come from their existing customer base.  That’s where we’ll focus our initial sales efforts.  Fold your sales activities into the on-boarding process so that you’re combining the academic pursuit with the closed first deal pursuit.

5 Techniques to On-board for Success -

1. Before signing let your new partner know what your expectations and next steps are.  Schedule the first required activity to occur within 48 business hours of signing.  Orientation, sales training or whatever you have defined as your on-boarding process.
2. Write and distribute a Press Release announcing the new partnership.  Post to your site and theirs for an SEO kicker and new partner attractant.  Be sure to add a line about how to join your program to bottom of PR.  Tweet it.
3. Send new partnership notifications with time-sensitive promo code to the partners entire customer base.
4. Meet with each sales person and secure a list (from each) of their 10 customers who are good candidates for your product.
5. Review each target with them, strategize and discuss closing offers.  This is where you connect with the new partner for sales and product training, understanding your product’s differentiators and establish the bond of trust that is your catalyst for success.

You can add your own variations, embellishments and rewards; but remember, the key to this technique is that you’re combining the training (on-boarding) with real-time sales activities and not treating them as separate serial activities.

Get Channel Smart - Dress Channel Smart!

The VAR-Kit is a flexible Channel entry offering designed for budget sensitive software vendors with plans of establishing a North American Reseller Program and the keen vision to seek out expert assistance to avoid the common and hidden obstacles.

Power through the most difficult and crucial Channel development times with the confidence that your expectations are valid and your goals can be reached.

This collaborative two-week high energy channel experience customized to your business, products, culture, staffing and budget is our number one requested and most recommended professional services offering.  Read our reviews – here

• Learn how to identify your ideal partner types and the benefits of a multi-segmented channel to craft an entire channel eco-system that fits your product, budget and culture.
• Identify your product and programs “Business Value Proposition” and how to succinctly deliver this critical information during the difficult recruiting process.
• Write and deliver (.doc & .pdf) your new partner prospecting message for each identified partner type
• Establish an accelerated on-boarding process that increases partner success and reduces time to revenue. .
• Partner Program Guide and tactical VAR business plan template (20 pages +) w/sample data.
• VAR Sales and Marketing Bus. Plan – Channel Manager’s version w/sample data (3 pages).

During our Fall Special you will receive our official VAR-City Jacket (what our staff wears) with your name or company scroll stitched on the front – a $250.00 retail value included at no extra charge during this limited time offer!

Contact us at 972.240.8793 or info@thevarcity.com.  If you’re not sure that selling through a partner channel is for you, download our self-assessment “Channels Readiness Quiz” located at our web site in the downloads locker.

We look forward to being all the Channel you need – ask us about our Virtual Channel Manager program – a great value and service with costs offset by product sales.

Nothing serious, just some things that will help explain how two, or more, self proclaimed and so-called experts can have such differing points of view – when, in fact we usually don’t.

For us Channel purists who reflexively cringe at the casual unintended abuse of terms like “VAR”, “Distributor”, or one of my recent favorites,“OEM” – yeah, I see you smiling and nodding knowingly out there – these words really do have meaning and fairly strict definitions that can be harmlessly glossed over in general conversation; but, when we get to the point of building a ground up Channel Program we want to be a little more specific.  And, in mixed company we want to be careful not to refer to an established Systems Integrator as a VAR for fear of a full-on stink eye attack and instant loss of Channel credibility.  You can also kiss that promising new partner contract you’ve been chasing bye-bye.

Now, the irony of the fact that the biggest and most frequent abuse is, in fact, the word “Channel”.  What does that mean, really?  We already lazily say Channel instead of Indirect Channel…and, when I say Channel do you really know what I mean, or do you associate it with your view of a Channel?  Hardware Channel, Telco Channel, Distribution Channel, Software Channel…where do you work and what do YOU do?

And finally, I come to the point of my post.  When you read blogs, forums and other posting from now on and you see two Channel knowledgeable pros going at it, you can bet good money that one is talking about “their” hardware, or retail experience while the other may be saying “…phooy on that – SPIFFS and MDF never work – NFRs are the way to go!”

Now you know – words have meaning and so do big letters.

Historically, reseller programs have a better than 60% failure rate – measured against self-sustaining profitability in the first year.

In more than half of the failed cases the effort was doomed from the beginning and no amount of preparation or experience would have delivered a different outcome.

There was zero Channel viability based on a variety of product aspects; and, all of the time they invested, resources and revenue became non-recoverable costs.  If only they had known that before they let the Channel siren-song lure them into cash flow dead zone.

Our 21-question Channel Readiness Quiz would have stopped them before they started and listed the respective weaknesses with a full explanation.  The quiz comes with an answer card (.xls) and totals the quiz takers responses to measure and report on their level of Channel viability and preparedness.

We invite you to retrieve the two-part Channels Readiness Quiz from our download locker at The VAR-City and send us your completed score card for a free one-on-one analysis of your product(s) and program.

I think of all the fun we’re going to have together chasing cars and digging in the neighbors’ new flower garden…boy, we’re going to be so Mayberry happy, little Kong and me.  Then, real memories of my last puppy come flooding back, chewed shoes, law suits, vet bills and all.

A new Channel program can be just as appealing.  The thought of other people selling your stuff, making you money and growing your user base…how bad can it be, right?

Well, while the big dog is always shovel-ready, your new channel will come with it’s own kind of mess and clean up duties.  Are you sure your’re ready to make the commitment to this long term responsibility?

Here are 5 tips to keep you out of the dog house with your partners:

1. Partners are like kids and they will push the boundaries to see how stretchy they are.  This is not a good time for “time-outs” or a rolled newspaper across the nose, as good as that might sound sometimes.  Be firm and clear in your expectations and don’t hesitate to make an example if necessary – the other partners are watching and learning.
2. Partners have a short attention span.  Be prepared to immediately begin training once the agreement is signed.  Focus their sales training on their existing accounts – get a list of Top 10 targets and work with them to close those first.  Once the pump is primed the revenue stream will begin flowing without your immediate assistance.
3. Partners don’t need your products or services, they were doing fine before you came along.  Don’t be another product that they have been instructed to insert into their already too-busy schedule and demanding quota – be the partner who can help them hit their numbers.
4. Never, ever use your reseller channel as an incubator for house accounts – no poaching your partner’s accounts under any circumstances.  That’s the worse kind of Channel Conflict.
5. Treat every call from your partners like they just dialed 911!  Be there when they call out and they will not be afraid to go out on a limb for you in the future.
6. BONUS TIP – Partners will be more demanding than any customer because when they recommend your solution their reputation is on the line – when their customers yell at them they yell louder at you and their bark can be heard around the world at blog-light speed!

“What are the most important things I should know or do before starting a reseller channel?”

That question, in one form or another, is one of the most frequently asked questions I hear from business executives pursing a new channel or trying to figure out where their current unproductive channel went wrong.

At that point we don’t’ talk about work flows, sales campaigns or target marketplace; we get back to the basics; the foundational building blocks of a successful channel.

I introduce them to “The E-Ticket to Channel Success”, a collective of actions, understandings and behaviors that lead to partner driven success.

In every productive channel I’ve seen over the past 30 years all 5 of these elements existed.  In every case of failure, one or more of these elements were missing!

Here they are, and you can find a more detailed explanation in the PowerPoint presentation at my website in the Downloads Locker.

E-Ticket to Success Elements:

• Ease
• Education
• Enterprise
• Enthusiasm
• …and the critical binder- Execution

Ease – Be easy to work with in every sense of the word.  Become the vendor partner they go to first because you make their job easier from first call to closed deal.

Why would you care?  Because resellers traditionally offer many products to address their customer’s needs – many overlap.  And, regardless of price/margin they will always lead with the option that is the ‘easiest’ for them to sell with less obstacles to navigate.

Education – Resellers will be more comfortable recommending the product they know the best; and, resellers will be more comfortable recommending the product their technical people are most proficient at demonstrating, implementing, training and supporting.

As a critical step in your onboarding process sales training must be initiated within two weeks of signing contract or agreement.

Enterprise – Is account penetration, up-selling,  and leveraging the resellers’ farmer nature of account care and nurturing.

Products that spawn future opportunities throughout their customer’s business are far more appealing than one-off sales.

Enthusiasm – Is the catalyst that inspires confidence in the sales representative and their customers.  It’s infectious and starts at the top.

Enthusiasm about the product, program and partnership radiates up and down the value chain and can be a force to shorten the sales cycles, even overcome stiff competition.

Execution – Diligent Execution is the lynchpin and most important of the earlier four components it unites.

Execution is following through on your promises, hitting deadlines and is critical to establishing loyal partnerships based on trust and respect.  Execution is leading by example and establishing a pattern of consistent responsiveness that must be in place before expecting the same from your partners.

If you place these principles at the core of how you do business with your channel partners you will have a solid foundation and framework to build your program around.