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Channel Marketing Updated on: May 16, 2023

Creating Your First Partner Program

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You’re a startup or a software company. You want to sell your product or service through partners. You want resellers or affiliate partners to refer customers to you. You want distribution partners to distribute your product or service to other partners who might sell it. You want to combine your technology with that of OEMs or so-called white label partners, maybe even let them use your brand and make a joint offer to your customers. It could be an exciting new market value proposition. Before you do any of this, you need to create a partner program.

Find partners with value

Your partners need to add value to you and your customers. You want partners who can help you find new customers, partners who have market access and expertise, who know prospects. Partners who have a certain level of credibility with a specific group of prospects that you don’t have yet. They will amend their credibility to yours. Another type of value a partner can provide is practical experience in marketing and distribution. Or maybe they have a reseller network that they can sell to. In the case of OEMs or white label partners, they might offer a lot of interesting intellectual property or software that can be complementary to what you do. How about bundling your product will theirs? The sum of the parts is always bigger than the parts.

Give value in return

If you want to find partners, you better provide value in return.  Traditionally it’s the margin. They’ll ask, “What’s in it for me?” What they’re really asking is, “How much money are you going to allow me to make on top of your product? What’s my markup?” They understand that margin is the profit they can make minus the cost of doing business with you. They’ll need to resell your product, to position it, to market it. Make it easy for them. Give them 2 things: the opportunity to make money and the simplicity of doing it. How much do they have to invest in training people? In the fulfillment infrastructure? How complex is it going to be? In the SaaS world it’s common for partners to avoid transactions. Instead, they collect a fee for referring customers to you. For example, at MightyCall we use a service called Ambassador. They help us manage an affiliate membership program.

Decide on partner benefits

Benefits start with things like an opportunity to make money. Describe it. How much can they make? What are the rules of making a margin? When they become better partners, do they get a better status? Do they become silver, gold, platinum partners? Does this mean they’ll make more money? What will you provide? Materials, content, website presence for your product or service? Training? Will you charge or will it be free? Will you give them yearly, quarterly, monthly opportunities to come to events or webinars? Will you supply them with marketing materials they can use to run their own campaigns, email templates, workflows? Can they use your tools and infrastructure? After you decide what you can offer, make sure to deliver on it. The worst thing you can do when launching your first partner program is making promises that you cannot live up to.

Decide on partner requirements

What will you ask of your partners? Make the requirement for the lowest status level easy to attain. It could be selling your product at least once a year (if it’s a really big contract) or selling it to thousands of customers (if the transaction value is low). You’ll be asking your partners, “How much business are you driving for us?” The more business, the deeper the commitment, the higher the status and margins. You can also ask for training, certification, and support. Or ask them to attend a yearly meeting, call it Partner Summit. In some cases, you may ask them for a fee to join your program. And, of course, once you set the requirements, make sure to enforce them. If you won’t, it will foster feelings of inequality and weaken your partner ecosystem.

Test your program before launch

What is the volume of partners you think you’ll recruit in the next month or year? Try to predict how many of those will pass certain criteria and will become regular partners. Think about how many of them will end up in each tier. Do you like the balance? If you have zero gold partners, it won’t be good for your image. If you have a few partners already, put them on a Partner Advisory Counsel or Partner Advisory Board. Ask them for feedback before your launch. Have monthly meetings and test-run your benefits and requirements with them.

Your to-do list:

  • Determine what types of partners you need: affiliate, distribution, resellers, OEMs, white-label, etc.
  • Write out your partner program benefits and requirements.
  • Create tiers. Play with numbers. See how many people you think would end up in each and if the balance is right.
  • Invite current partners to be your advisors and test your system before you launch it.

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