Channel partners are the bridges your customers take to discover you. 

Your company's relationship with partners is of utmost importance when trying to venture into new markets and geographies. Channel partners become your voice and ears in places that are beyond the scope of your ideal customer profile. 

It is essential to manage these relationships well since they’re vital to driving new business revenue and repeat sales from new locations. But before we dive into them, let's spend some time understanding who channel partners really are. 

What are channel partners? 

Channel partners are individuals or companies who help their clients sell products or services in new markets, reaching a larger audience. They let organizations expand their distribution networks and drive more revenue. 

Unlike direct sales, clients don’t precisely manage the sales operations of channel partners. Instead, they offer relevant channel partner tools and enablement content that helps them sell effectively on behalf of clients. There is less control over the sales ops, but it opens up opportunities to sell in markets previously unknown to the company.  

Channel partners usually work on a profit-sharing model. Companies get lesser margins, but in the long run, it’s more efficient since a firm doesn’t have to invest in building and running a complete sales team when exploring possibilities in a new market. 

Channel partners help them quickly scale their distribution by leveraging customer relationships they have built for a long time. 

Types of channel partners

Channel partnerships are diverse, taking many forms to suit different business needs. Businesses get immense value from them. For example, 90% of deals with a value of more than a million dollars at Salesforce involve channel partners.

If your organization is developing a channel partnership program, consider the types of channel partners with whom you can collaborate. 

  • Indirect sales partners are third-party entities that form the bridge between you and the customer while selling your products and services. SaaS businesses such as use 85 channel partners in 45 countries to sell work operating systems. The company doesn’t maintain a global sales team. 
  • Resellers sell vendor products with minimum customization. They target a specific market to sell the products. Usually, companies onboard resellers when they’re trying to sell in a new market. For example, Informational Services International Dentsu in Japan resells KnowBe4’s security awareness platform to Japanese customers.
  • Value-added resellers (VARs) provide services like configuration, consulting, and customization while selling vendor products. For instance, Salesforce collaborates with CloudSmith in Africa to sell its solution and provide extensive training and implementation. 
  • Agency partners blur the lines between channel and technology partnerships. They bundle a vendor’s product as one of their services. Vendors usually offer them referral benefits. 
  • Managed service providers (MSPs) handle a company's IT infrastructure end-to-end while integrating various technological solutions into a cohesive system. 
  • Affiliate programs let partners earn a referral fee for directing customers to the vendor. FreshBooks is a good example of a product that uses affiliate partners. It offers $200 for each free trial that converts into a paid plan. 

Is channel partnership right for you? 

Channel partnership is all about relations and how you nurture them. More than that, it’s about empowering these relationships to help you sell more effectively and creatively. 

However, it must align with your company’s strategy to work for you. Based on experts, a business should consider investing in channel sales when they’re 50 employees and $1 million strong in revenue. But there’s nothing like the best time or situation to consider channel sales. 

The decision entirely depends on your business strategy and the market you want to target with available resources. However, before you double down on building a channel partnership program, you need to check a few basic things. 

Make sure you have: 

  • Product-market fit
  • A sales model that works
  • Space to share some profits with channel partners.

If even one of the items on the above list doesn't check, explore another strategy to close more deals. A channel partnership program works best when you can give them a clear picture of what to achieve and how to do it effectively. 

This will help you avoid any confusion and ensure that your and your partners' efforts don’t go in vain. 

What makes a good channel partner

Below are a few characteristics that define an effective channel partner. A good channel partner will have: 

  • Noticeable market presence. They’ll have a good reputation on the market and a broad network to distribute your products effectively. 
  • Similar values and goals. The partner will share your company’s value and has the ability to align with your business goals. It helps converge your entire sales motion toward a single target. 
  • Good domain knowledge. A partner may not have an in-depth understanding of your product or services yet, but they’ll possess strong domain knowledge about the industry, customers, and the audience’s needs and wants. 
  • Commitment toward their job. A channel partner will maintain transparency in all dealings, which earns their client's trust. This will be evident from their social presence and how their former clients engage with them on professional networking sites like LinkedIn. 
  • Ability to collaborate. Channel partners will navigate new market complexities. Collaboration as a skill will help them work better with their clients to find the best possible solution. 
  • Customer-centric approach. They’ll listen to customer feedback and adapt strategies accordingly to serve them better and offer the best solution for their needs. 

How to create a channel partnership program

Before you build a channel partnership program in a company, see if it fits your organization well. Partners can help you expand your sales outreach. However, you must ensure you can trust them to carry your brand’s reputation the way you do. 

1. Select and onboard the right partners

Use the tips in the above sections to identify the right partners for your brand. Ensure they align with your company’s values and are easy to work with. Look for their records and check the length of time they have been associated with their previous clients. This will give you a perception of how effectively their methods work. 

Make sure you vet them properly, as they will be the ones who carry your brand’s voice to new markets and geographies. 

2. Maintain a direct communication channel

Channel partners should be able to talk to you directly to get the support they need to understand and sell your products. Ensure they can reach you directly via Email or WhatsApp and get the support they need. 

If you work with the partner and their team on WhatsApp, it might flood your inbox, displacing your focus every time you open the application. Cooby will help you keep these conversations organized, making sure these collaborative discussions are productive. 

Cooby’s WhatsApp productivity solution will automatically sync these messages to your HubSpot or Salesforce, where you can manage direct and indirect sales together, giving you a complete overview of what’s happening on both sides. 

With Cooby, you’ll be able to maintain your focus while ensuring you’re able to support channel partners with everything they need to sell your products and services. This will also help channel partners offer support and manage their clients effectively, who are, after all, your paying customers.

Streamlining communication is a key part of partner success and enablement. The Association of Strategic Alliance Professionals reports that partner success is increasingly seen as integral to customer success. It’s because there’s a strong connection between partner experience and customer experience. 

3. Choose a partnership model

Decide on how you want to structure your partnerships. You can sell alongside your partners, sell through them, or have them sell for you. Each option serves different strategic purposes:

  • Selling together might mean complementing each other’s offerings, like a caterer partnering with an event cleanup company.
  • Selling through your partner could look like your products being offered through a department store, adding variety to their range.
  • Partners selling for you involve them incorporating your product into their offerings, sometimes without the end-user knowing your brand.

4. Provide them with relevant content

Channel sales is tricky because channel partners don’t have the same support from you as your sales team does. You must ensure they’re well equipped with sales decks, one-pagers, battlecards, calling scripts, and other sales enablement content you feel would help them close customers faster and better. 

Encourage and empower them with detailed sales resources. The more confident your partners feel about your product, the more motivated they will be to sell it.

5. Create a reward system

Think about incentivizing your partners like you do for your sales team. You don’t need to match the incentive structure perfectly (considering both are compensated differently), but let there be something they get as a reward for achieving their quota. 

Such incentives foster loyalty and drive your partners to achieve higher sales targets. 

6. Track channel partners’ performance

When you measure the impact you’re getting from channel sales, you’ll be better equipped to scale it. 

Consider setting KPIs like partner-influenced revenue or partner-qualified leads to assess the health of your channel partnerships. Some companies leverage partner relationship management (PRM) software to evaluate channel partner performance and assess its impact on business revenue. 

Pros and cons of channel partnerships

Like two sides of a coin, channel partnerships have two faces. Channel partnerships help you acquire new customers at a comparatively lower cost since partners leverage their own network and marketing efforts. 

When entering a new market, you don’t need to build a complete sales function. The partners help you make successful hit-and-trial iterations and check the results before investing in a full-scale sales motion. 

Moreover, when you work with reputable partners, the trust their network has in them gets transferred to your brand. It helps you establish credibility a lot faster in a new market. 

Here comes the other face. 

Channel partnership doesn’t give you as much control as you have over your direct sales program. It makes it difficult to forecast revenue and plan numbers strategically. Since it’s indirect sales, you may not receive direct customer feedback, which might limit your ability to improve products to meet customers’ needs. Lastly, channel partners require a lot of support and can consume ample time to get them up to speed. 

However, you don’t need to ramp them up in a day. Let it be a continuous process with direct communication. As you leverage Cooby to manage channel partners, supporting and nurturing these relationships will become much easier. 

The way forward

Traditional channel partnerships are moving toward a more dynamic and indirect ecosystem that includes affiliates, advocates, and referral partners. With this shift, channel partnerships are becoming more fluid and include diverse partnership types. Companies should adopt partnership strategies to seek more flexible and integrated arrangements. 

As channel partners become more integrated with your revenue team, you can’t let them fly solo. You need to support and empower them at every stage when they’re closing precious deals for you. 

Try Cooby to manage communications with partners and give them your undivided attention when they need it most. 

"Cooby created a massive impact on our business. Our teams became more efficient and effective in managing clients on WhatsApp."

Pascal Lammers
Head of Digitization, Mission Mittelstand GmbH

About the author

Sagar Joshi
Content Marketing Manager at Cooby

Sagar Joshi strongly believes that content marketing is a way of helping people. It motivates him to write well-researched content pieces on sales, marketing, and customer experience. In his free time, you can find him reading a book, learning a new language, or playing badminton.

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