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How to Build a Channel Partner Program in 7 Steps

Apurva Pathak | April 6, 2022 | 563 views | Read Time : 20:00 min

Channel Partner Program
Channel partner programs help multi-billion dollar companies like Microsoft, Oracle, eBay, and many more increase their revenue and grow their businesses.

A channel partnership is when a company partners with another company to market or sell its products, services, or technologies.

What exactly do channel partnerships do for your revenue? What do channel partner programs entail? Let us take a look.

Why Are Top Companies Engaging in Channel Partnerships?


  • Channel partnerships accelerate business growth
  • They create high brand awareness at a low cost
  • They increase revenue through various partner channels
  • They allow seamless expansion into new markets and verticals
  • They contribute to a better customer experience


C-level Executives Are Sitting Up and Taking Notice

In an interview with Media 7, Sam O’Brien, CMO at Affise, discussed the growth of channel partnerships.

Since joining Affise I've had many senior, experienced CMOs, head of marketing, demand generation leads reaching out to me asking how they can learn more about partner marketing. We want to solve that and make it easy.”

Sam O’Brien, CMO at Affise

Global partnership ecosystems are thriving. They accelerate the growth and expansion of companies into new markets and verticals. Managing channel partnerships needs to be taken seriously. C-level executives are doing their bit by hiring competent ecosystem managers. An example of this is Reputation, the global leader in reputation experience management (RXM) expanding its executive leadership by hiring its first-ever Chief Ecosystem Officer, Brent Nixon. He is the other ‘CEO’ who creates and fosters a long-lasting partner ecosystem as Reputation continues to grow across Europe and Asia.

How Many Types of Channel Partnerships Are There?

There are many types of channel partner programs that B2B companies create. Here are some important ones:

  • Affiliates
  • Referrers
  • Resellers
  • Tech Alliance Partners
  • Cloud Service Providers
  • Original Equipment Manufacturers
  • Strategic Partners


What Does a Channel Partner Program Entail?

A channel partner program is a way to get channel partners to do more for your customers. Implementing channel partner programs can transform the way you do business. However, creating them is not easy. They take a significant amount of time, effort, and, most importantly, strategic planning. To ensure the success of your channel partner program, you need to get into deep waters, research potential partners, brace for swift growth, streamline your processes, and confidently venture into markets while being aligned with your business goals.

Here's what you should be looking at before creating a channel partner program:

  • Status of business
Your products or services should be tried and tested for your partners to invest their time, resources, and trust in them. The demand and appreciation of your product or service offerings should be motivating enough for them to go the extra mile.

  • Streamlined sales cycles
Streamline your sales cycles so you know what works best for your in-house sales processes. Only then can you explain to your partners how you want them to sell and distribute your products.

  • Key markets identified
You need to figure out which key markets your partners can help you target through your channel partner program. How can your partners help you position your brand in these new markets? How can your partners do more for you in these markets? If you think they can do more for you than you can do for yourself, then it can be a great foundation for creating your channel partner program.

  • Readiness for growth
Channel partnerships steer new clients to your business. Ensure that you are ready to accommodate this growth, and serve these new customers with the same enthusiasm that helps you retain existing customers. Your customer support personnel are key to creating an excellent customer experience for your new customers.

How to Build a Channel Partner Program in 7 Steps


Discover the Right Partners

Arrive at a consensus with your stakeholders about expectations from a new partner. The partnership should be based on common business goals and brand culture. It should be based on mutual respect, shared vision, and values so customers have the best experience while interacting with your product. Your partner should complement your skills and alleviate your weaknesses. Apart from these factors, choose a partner who has

  • access to the markets you want to enter
  • the ability to help you achieve expected revenue
  • distribution channels that meet your needs
  • a customer base that serves your purpose
  • a strong intention to enter a lasting partnership


Reaching Out to Shortlisted Partners

Once you find a potential partner who ticks all the important boxes on your checklist, approach them to discuss your business goals and what you can achieve together. Highlight your challenges, previous partnership achievements, and the benefits of the proposed partnership so that your partner program creates great value for you both. It is crucial to work towards relationship-building from the get-go, so your intended partner understands your mindset to address customer pain points.

Create a Partnership Agreement

After you finalize your partner, work on creating a partnership agreement. Put on paper your shared partnership goals, target markets, specify your duties in detail, commit to the resources you and your partner will offer to enhance the partnership, clearly state your expectations and terms, list the strategies and tactics you plan to use to achieve your goals, and detail your incentive plan. Other factors like payment terms, indemnification terms, and partner marketing efforts should also be mentioned to ensure transparency from the beginning. Creating a solid partnership agreement will hold both parties accountable for their actions and will protect both businesses from any mishaps. Get a second professional opinion on the agreement to ensure you are not missing out on anything important.

Decide the Metrics

Without tracking the measurable goals of your partnership, you cannot ensure the success of your channel partner program. Follow the SMART analogy for your goals. They should be specific, measurable, attainable, relevant, and time-bound. Your channel partner program should measure KPIs like these:

  • Total and average revenue per partner per channel tier
  • Revenue achievement against specific products
  • Revenue by geography
  • Number of deals registered
  • Partner satisfaction
  • Channel attrition rate
  • Effective MDF (marketing development fund) utilization
  • New Customer Logos
  • Renewal Rates

By deciding on the metrics that effectively illustrate the performance of your channel partner program, you and your partner can easily understand the weaknesses of the partnership and address them in time to get the most out of the program.

Streamline the Partner Enablement Process

Partner onboarding doesn’t end after signing the agreement. You need to invest time and effort in channel partner management by enriching the partnership through partner enablement activities such as:

  • Customized training for partners
  • Explaining your product to the partners for appropriate brand representation
  • Providing them with tools and resources to sell your product better
  • Continuously communicating and updating the partners about product updates
  • Listening to partners’ concerns and issues in the selling process
  • Congratulate and reward your partners for their achievements


Efficiently Manage Partnership Using PRM Tools

Manually managing all the channel partner program data can be overwhelming. The PRM software eases the management process. You can streamline your recruiting, training, and partner relationship management. Partnership tasks can be managed efficiently through PRM software. Here are the features that your PRM software should have:

 


Create Partnership Incentive Plans

Incentives are a great way to keep your partners on their toes to sell your product better. They will strive to offer your customers a great customer experience and remain enthusiastic about their partnership commitments.
SiriusDecisions’ Principal Analyst, Jay McBain, noted that partners are looking for better partner experiences and more innovative partner incentives.

Your partnership incentive plans should be structured, comprehensive, personalized, clear, and transparent because they can drive an increase in revenue and market share, draw in new customers, and enhance teamwork and collaboration. The most popular incentive plans used by businesses are:

  • Gift Cards
  • Merchandise
  • Award Points
  • Trips and Travel
  • Commissions (Rebate)
  • Sales Performance Incentive Fund (SPIF)
  • Market Development Fund

Conducting special events to commemorate the success of the partners, treating them to frequent dinners, and hosting special educational sessions for them can also create positive reinforcement to work harder towards revenue generation and create an emotional connection with the partners.

Ringadoc Got a 1,983% Boost in Their Annual Revenue

Ringadoc’s channel partner program is a great successful partnership program example. The start-up company saw a 1983% boost in its annual revenue and a 1000% user-base growth within just six months. Interestingly, they did not have to bear any upfront costs for these results!

Summing It Up

To grow sales, revenue, and a loyal user base, B2B organizations need to create successful channel partner programs that can help them thrive in new markets. The best channel partner programs can create higher brand awareness and pave the way for success in new verticals.

FAQ


How can you motivate channel partners to increase revenue?

By nurturing your channel partnerships, providing partners with technological support to sell your product, and remaining connected to your partners, you can motivate your partners to generate revenue for you by aggressively selling your product to the targeted customer base.

What is a great example of a channel partner?

A channel partner is a company or an individual that helps you sell products. Affiliates, resellers, tech alliance partners, and cloud service providers are some of the types of channel partners.

How do channel partners make money?

Channel partners make money through referral fees, pre-defined commissions, or by selling services like customer support, training, or consulting.

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Tufin Announces Winners of Annual Partner Awards

Business Wire | June 09, 2023

Tufin®, the leader in network and cloud security policy automation, today announced the 2022 winners of its annual partner awards, recognizing companies across the Americas, EMEA and APAC for their commitment to helping customers drive continued value from their Tufin implementations. These awards were handed out at the recently completed partner summits in each region. “The partners recognized here are on the cutting edge, delivering the technology and solutions customers need to efficiently and effectively defend their organizations in on premise, hybrid, or multicloud situations,” said Jeff Wilmot, CRO at Tufin. “We’re honored to work with such great teams.” Tufin’s channel partner program was recently spotlighted in the 2023 CRN® Partner Program Guide, highlighting the program’s ability to help partners establish new revenue and growth opportunities. There is a growing need among enterprises to bridge the gaps between network and cloud security by increasing visibility and control across all aspects of their environment. By working with Tufin, partners have access to the innovative technology they need to help their customers fully optimize their security operations. “As we accelerate growth in the coming year, our partners are THE strategic pillar of Tufin’s go-to-market strategy and one of our greatest force multipliers,” added Jeff. “We are fully committed to continue building on our global momentum and driving joint success.” This year’s award winners are: Americas East Region Partner of the Year: Atlantic Data Security, LLC West Region Partner of the Year: World Wide Technology, LLC Canada Partner of the Year: GoSecure Inc. Breakout Partner of the Year: Nexum, Inc. Distributor of the Year: Carahsoft Technology Corp. APAC Partner of the Year: NTT Com DD Corporation Distributor of the Year: M.Tech Products Pte Ltd. Best Regional Distributor: SVA Distribution Limited EMEA Western EMEA Top Resellers: Nomios Southern EMEA Top Reseller: Kirey SRL Central EMEA Top Resellers: APIUS TECHNOLOGIES S.A. Northern EMEA Top Resellers: Computacenter AG & Co. oHG, Telia Cygate AB, Computacenter (UK) Ltd. Western EMEA Top Distributor: 2SB Security Solutions 4 Business Southern EMEA Top Distributor: Exclusive Networks Bilisim A.Ş. Central EMEA Top Distributor: Arrow ECS GmbH Southern EMEA Best New Partner: VEM Sistemi SpA Southern EMEA Best Support Partner: MATICMIND SPA Southern EMEA Best New Logo Win: DGS S.p.A. Central EMEA Best SDP +: AERAsec Network Services and Security GmbH For more information about Tufin’s channel partner program, including details on how you can become a member, please visit: https://www.tufin.com/partners/channel-partners. Tufin will be holding half-day Tufinnovate World Tour events from June to September 2023 in cities across the United States, Europe, and Asia. These are open to IT and security executives, managers, network security practitioners and partners interested in enterprise cybersecurity for multi-vendor hybrid cloud networks. To learn more and sign up to attend, click here. About Tufin Tufin is the leader in network security policy management and continuous compliance automation. The platform centralizes, automates and orchestrates network and cloud access for many of the largest organizations in the world. Over 2,900 enterprises have trusted Tufin to implement accurate network changes in minutes instead of days, accelerate secure application deployments, and virtually eliminate manual tasks. A vendor-agnostic solution designed to integrate network and cloud security processes, Tufin is the answer to balancing security and business agility. Find out more at www.tufin.com.

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