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The Evolution of Channel Partner Programs & Their Characteristics

The typical characteristics of channel programs at four stages of growth

Relayware Partner Relationship Management

The Evolution of Channel Partner Programs & Their Characteristics

Posted on August 22, 2016

Every large, robust channel partner program started as a small, burgeoning program, and every phase has its own characteristics.

It may be tempting to associate small channel programs with smaller companies, and giant partner programs with large, multinational programs. But that’s not always the case. There are smaller, “start-up” (which is a wishy-washy definition with many different ways to measure “start-up”) companies that have powerful, hearty programs. And there are large multi-national companies that are only dipping their toes in channel sales.

So, how does your program stack up? Regardless of your companies’ revenue or number of employees or geographies, would you characterize your channel program as “growing” (hopefully, they are always growing), mid-market or enterprise-grade?

Let’s look at the common attributes of programs at each of these stages.

Nascent programs have fewer than 50 channel partners. The channel manager is often keeping track of everything through spreadsheets, their inbox and individual documents. This includes logging the deals registered by each partner, emailing out the marketing materials and answering questions from the channel partner professionals.

The Growing Program -- Once a program has more than 50 channel partners, it’s a bit more unwieldly to manage the partners’ needs through these disparate systems, much less provide a whole picture of how the program is doing. Though, a “growing” partner program can still be managed by only channel manager. These programs typically have 50 to 250 channel partner organizations and can have as many as 5000 contacts spread across those organizations. They are focused on recruitment and onboarding. It’s essential to get best practices out to all the channel partners, and there’s a need for speed to get partners live and selling in the field. Often – though not always – these programs have a shorter sales cycle.

These vendors absolutely must have a partner portal, and they begin to need the larger functionality that comes with a partner relationship management solution. However, they may not need every feature a PRM software has to offer.

A mid-market program has a channel team managing 250 to 2500 partner organizations. This channel management team has experience running channels. It’s not their first rodeo.

With that many organizations, it’s essential to have more sophisticated tools, and tools that can offer great reporting and measurement. The processes for management are a lot more complex. PRM is essential. These programs have figured out recruitment and onboarding, and they are more focused on refining deal registration, certification and ongoing engagement with their channel partners. You can imagine how difficult it is to have strong engagement with 1000 or 2000 channel partner organizations.

This is also the size of program where vendors begin in earnest to segment partners and give different tiers real value.

Now, often a program that’s in the mid-market phase may find that it’s the second or third attempt to get a growing program across the hurdle into smooth sailing. There’s a big gulf between what’s needed to manage 250 partners and 2500 programs. So, this can be the most difficult phase for a channel partner program development. Throughout the lifecycle of a program in the mid-market phase there will need to be adaptation and refinement, and that doesn’t mean failure.

And finally the big boys – the Enterprise-grade channel partner programs. These programs have multiple channel management teams, over different geographies. These programs are established and have a natural cadence and rhythm that is more difficult to disrupt. They are focused on the optimization of what they already have in their program (because they already have all of the components from recruitment, onboarding to sophisticated marketing and sales processes). They have complete segmentations, and if measuring and reporting was important before, measurement of every aspect of the program is a given, which also means a lot of reports and data. They may build their own PRM, but it’s not a given. There are complete PRM solutions on the market, and these companies may well know that their internal resources aren’t cut out for coding and development. But their systems probably do have a lot of customizations, which can be expensive, but it’s not a concern, because of how well-oiled these programs are.