Channel Sales Roadmap (Part 2): Distribution Channel Management
The way technology products and services are bought, sold, deployed and used have changed forever. As an ISV (Independent Software Vendor) or other technology provider, you need to change with it to maintain a competitive advantage and drive sustainable revenue growth.
The Internet of Things (IoT) has caused an explosion in the amount of data that is created, shared and stored every day. Cloud computing has enabled companies of all sizes to use technology that was historically only available to the largest enterprises with the biggest budgets. Business executives are now taking control of IT resources, eliminating their CIO’s involvement, and meeting their departmental goals more quickly by deploying cloud-based line of business applications on their own.
In Part 1 of the Channel Sales Roadmap, I reviewed some of the reasons why you might want to have an indirect distribution channel as your new sales model and helped you assess if there is truly a need for your new product or service by evaluating the components of an effective go-to-market strategy.
Once you have developed your go-to-market strategy and decided that an indirect distribution channel is right for your business, the next step is to ensure that your company is “all in” and ready to execute on a channel strategy.
We will now address how to prepare your internal teams for this shift in strategy and mindset.
Distribution Channel Management: Getting Your Internal Team in Order
An effective sales strategy is not simply the responsibility of sales, just as a go-to-market strategy is not simply the responsibility of marketing. Effective, efficient and successful indirect distribution channel preparedness is achieved when everyone in your company is committed to and focused on channel success.
Internal Channel Preparedness
To achieve successful channel integration outside of your company, it is critical that everyone inside your organization is on board and understands their responsibilities:
It is essential that all members of your executive management team from your CEO to CIO, COO, CMO, and others are fully on board with this new road the company has decided to travel down. This is a critical corporate decision, transitioning from a direct sales model to a channel sales model or adding a channel model to your existing sales strategy. If employees see that even one member of the executive management team is not fully on board, they will not give the implementation 100% effort and it will be doomed from the start. It needs to be a priority for everyone.
Although your sales, marketing, and support teams understand who their target customer is and what their needs are, supporting channel partners who are in the middle between you and your customers is quite different. To build a knowledgeable and supportive internal channel team, you will need to determine:
Could select employees within your organization transition from their current roles to channel management roles or will you need to hire additional outside personnel to fill those roles?
How will you separate the responsibilities between onboarding, enabling and supporting your channel partners?
Will you provide in-field sales assistance?
Will specific members of your team be required to travel to partner offices to participate in joint sales meetings with customers or train your partners’ team on new solutions?
Some members of your team may work exclusively with channel partners, providing onboarding success, channel growth or technical support. Other employees may have partial responsibility for the growth of direct sales as well as the growth of channel sales. If their time will be split between direct sales and the channel, it is critical that they fully understand their responsibilities and the time and resources which should be allocated to each.
Working with channel partners requires a different mindset, skills, and expertise to be successful. Evaluate the skill sets of your current team to determine if they could make the transition to an indirect distribution channel and what types of people you will need to hire to round out the group. Develop training scenarios where you focus on possible roadblocks and objections your team may face and walk through how to overcome them to successfully close a deal.
Distribution Channel Resources:
You must evaluate and take inventory of all of the resources that will be needed, paying special attention to resources required during the onboarding and enablement process. This may include sales collateral, training presentations, support documentation, marketing materials, just to name a few. You will need to arm your channel partners with materials and messaging which resonates with their customers. Enable them to customize your materials, so they can present their unique value proposition and differentiate their business from their competitors.
One critical question to ask yourself is who will be responsible for generating leads? If you will sell into a market you already know well, you may want to take on the responsibility for lead generation and then distribute those leads to your partners for follow-up. Alternatively, if you are entering a new market or transitioning from SMB customers to enterprise customers with whom you have little experience, you may ask your channel partners to be responsible for lead generation since they already understand the needs of those customers.
In Part 1 of this Channel Sales Roadmap, we looked at how building your go-to-market strategy and launching a new product/service is much more complex than simply ensuring that your solution works.
In Part 2, we have looked inside your company, bringing up issues you need to take into consideration to make sure that your internal systems, personnel, and materials are ready to take on a new distribution channel. Most importantly, we addressed the fact that channel success starts at the top with 100% buy-in from your CEO and executive management team.
In Part 3, we will discuss the actual steps you need to take to recruit, evaluate, and support your partners now that you have chosen an indirect distribution channel as your sales model.
About the Author
Lisa Masiello is an award winning tech industry marketing strategist, advisor and founder of TECHmarc Labs. She writes on B2B growth, channel management, marketing strategy, customer experience, and CMO success. Chat with Lisa by email at Lisa.Masiello@TECHmarcLabs.com. Connect with her on LinkedIn.