There are massive benefits to a successful Channel Partner Incentive Program. However, it's important to stay on top of key risk points.
Volume incentive rebates. Product promotions. End-user pricing. The ways in which organisations use channel partner incentive programs vary from company to company, but there are common risks no matter the method.
Authorised Channel Partner Incentive Programs introduce a competitive edge and can see vendors boost market sales to a massive degree. But if they fail to avoid these pitfalls, the structure of such a scheme can fall apart entirely.
1) Changing legislation
The Royal Commission into the Australian banking industry is a clear-cut example of the legislative landscape potentially impacting Channel Partner Incentive Programs' potential. From remuneration reviews to code of conduct analysis, it's important that all vendors work with a partner who understands exactly what's happening in the world of legislative change, and is one step ahead of any potential shifts.
That's the difference Power 2 Motivate can make. With years of expertise and our finger on the pulse, we can help partners stay abreast of any significant change.
2) Poor analytics
Every channel partner program needs strong, comprehensive data hygiene. Associated platforms should be able to deliver insight into cross-selling, upsell and attach rates, organised by product, channel and even individual representative.
Without strong analytics on a sales team's performance under an incentive, organisations will struggle to see how they can grow in the partnership.
3) Only building for the short-term
A strong Channel Partner Incentive Program is a fantastic way to inject drive and energy into a team of representatives - but done poorly, this light can fade fast.
Consider the long-term impact of a program before you implement it. How will the competitive edge impact reps' relationships with one another? Does incentivising sales of a particular product drive a spike in sales, followed by staff burnout or churn?
It is critical that businesses have safeguards in place for stepped, sustainable growth in their sales teams. Without this, there is no focus on organisational longevity.
4) Not building strong partner profiles
Not everyone makes a fantastic channel partner. Anything from social media reach to core business values can have a strong bearing on whether a vendor will be effective at selling your products, no matter how strong the incentive scheme is.
The key to successful partnerships is strong profiling. Understand what will make a good vendor for your services or products, conduct market research, and articulate a clear vision for the ideal channel partner. From this template, you can build a healthy network of vendors.
5) No ongoing evaluation
Even after you establish a channel partnership, it is critical to engage in ongoing reviews of the system. Local laws, partner conduct, sales reporting and your contract terms should all be revisited at regular intervals, to ensure vendors meet targets and uphold the good name of your product.
This can be significant work, especially with multiple channel partnerships underway at once. But failing to conduct ongoing partner evaluation can see negative consequences, with no immediate recourse for change.
Built the best in your channel partnerships
With the right incentive structure, analytics, review system and long-term goals, suppliers can build a powerful network of vendor partners. As with any business relationship, channel partnerships must be built on good faith and transparency - by addressing these pitfalls, any organisation can get off on the right foot.
To find out more about your next channel partnership opportunity, contact the team at Power 2 Motivate.