Effective channel partnerships are a proven sales driver in numerous business sectors, including automotive, software and hardware vendors, the energy industry and healthcare. Points, cash, prepaid cards, merchandise, travel and experiential rewards are the most commonly used “carrots” that motivate desired partner behaviors and represent as much as 60 percent of channel marketing expenditures. In these days of tight budgets, getting the maximum return on that budget is critical.
If your business relies on channel sales, you’ve already been exposed to numerous articles, seminars, and probably even consultants telling you how to maximize returns on your sales incentives investment. What I’m suggesting is that you step back and take a look at the actual process of determining and distributing those incentives. This process can have a huge impact on the effectiveness of your channel incentives.
Let’s start by looking at what you want broadly. In our experience, managers in charge of incentive sales want their brand to be top of mind for their channel partners, and they want partners to use desired behaviors to execute sales programs and follow up on leads—fast. These are reasonable expectations. So isn’t it reasonable for your channel partners to expect the same of your organization? That is, isn’t it reasonable that your incentive rewards be personally meaningful to the recipient (much as you want your brand to be personally meaningful to your channel partners) and delivered rapidly and seamlessly?
Determining what constitutes a personally meaningful reward for channel sellers takes some work but it’s worth the effort. By getting to know your channel partners better you can find incentives that are personally meaningful without eating up a significant portion of your budget. Face-to-face visits with channel partners can reveal more about the actual sales reps, and what truly motivates them, than any one-off rally or sales event. That knowledge will enable you to zero in on rewards that resonate.
Speed and efficiency are also strong influencers of an incentive’s impact. We recommend that rewards to consultants are made as close as possible to achieving sales targets. If you run SPIFF programs as well as year-long programs, you’ll want to make sure your rewards and recognition platform can handle both seamlessly. You’ll also want a platform that makes claiming those rewards as easy and fast as possible (here are 10 questions to ask vendors about their channel sales claiming system). After all, your channel sales associates have already earned their reward; you don’t want them to have to work hard to claim it.
Unless your rewards are personally meaningful and delivered rapidly and seamlessly, your channel incentive program will fall short of its full potential and you won’t be getting everything you can from your budget. The suggestions I’ve made are a starting point. By getting to really know your channel partners and reviewing your rewards and recognition platform to make sure it’s delivering on expectations, you’ll be taking important steps toward maximizing the impact of your channel incentives without breaking your budget.
If you’re thinking of implementing a new sales incentive program or refreshing an existing one, contact a Marketing Innovators solutions expert for help in making that important decision.