A channel-friendly sales organization creates strategic partnerships with other organizations to better serve customer needs by providing them with indirect sales opportunities. Companies enjoy many benefits when they go beyond only offering direct sales. Some of the top ones include gaining a larger market share, expanding their influence, and increasing revenue at the top-line level.
However, a company being open to outside sales channels and understanding the benefits of such a working relationship doesn’t mean it will manage the relationship well. Below are several tips for any sales organization looking to improve the effectiveness of its sales channel.
According to recent data published by the Frontier Strategy Group, companies responding to the survey reported an 11 percent increase over five years in the growth of top-line revenue after hiring a dedicated channel manager. The primary responsibility for someone in this position is to manage relationships with third-party distributors.
A person who makes a great sales manager won’t necessarily do well in the role of channel manager. That is because the two positions require different skills. When extending an offer for a channel manager role, the recruiter should ensure that the applicant possesses the ability to coach, manage, and position each sales partner to sell as many products as possible.
When working with channel partners, it’s important for sales organizations to understand that both serve the same customer. One thing that can disrupt this business partnership is salespeople continually sending partners unqualified leads. The partner may become so frustrated at not closing enough deals that he or she discontinues the relationship.
The best way to avoid this is for sales representatives to acquire in-depth product knowledge and study the market in which the channel partner serves. Sales representatives who align their strategy with buyer needs enable their partners to do the same.
Channel partnership requires a tremendous amount of cooperation between sales representatives, vendors, sponsoring companies, and even customers. That means that communication between all parties can present a challenge. Creating an invitation-only website, Facebook page, or LinkedIn group can be an ideal solution to this common problem. The person who creates the online gathering space should make it clear that the purpose is to share best practices with one another. Asking questions, sharing success stories, or requesting advice to overcome a sales challenge are just some of the common things that happen in this type of community.
It’s common for sales organizations to want to reap the benefits of a strong channel partnership program without truly committing to it. It will take a lot of time, resources, and learning by trial and error to get an effective program up and running.
Companies must be willing to provide salespeople with the financial resources they need to bring new organizations into the channel. While the upfront cost is a reality, statistics show that the increased revenue from salespeople connecting with channel partners is significantly higher than revenue generated by direct sales.
The exciting thing about sales channel partnership is that companies don’t have to limit their connections to the United States. By utilizing organizations such as the U.S. Commercial Service, for example, they can expand these relationships worldwide.
