Sales Enablement

Beyond Affiliates – Building Channel Sales

As a business owner, I can’t tell you how often I get approached with the opportunity to make an extra buck or two on affiliate revenue.  If I will just use my clout to hock their wares, they’ll pay me money.  And, after all, as long as someone pays me money I’m motivated to do it… right?  Wrong.

If you’re hell-bent on building an affiliate-based sales model, save yourself some time and go to where the affiliates are.  Clickbank, Commission Junction, or the like.  And, I’m not knocking that model.  It works.  It’s profitable.  And there are individuals who are skilled and interested in that sort of opportunity.  It just so happens that they aren’t always one-in-the-same with successful business owners with profit-generating companies of their own.

For various reasons, often having to do with brand image, affiliate sales might not be what you’re looking for after all.  While it can get results, it can come with a reputation.  If you don’t want to see your product hocked on hundreds of different squeeze pages with hyped long copy, pushed out in twitter streams chock full of affiliate links, or spammed to millions of people — all with your name on it — then you might consider a different approach.

The challenge, then, is how do you get “reputable” businesses (and I use that term hesitantly, as I don’t mean to imply that affiliates are categorically of ill-repute) to represent your product in more conservative business fashion?  The answer: find what motivates them.

As Douglas Karr pointed out in a recent post, citing one of my favorite viral videos, money isn’t always the answer.  In fact, it rarely is.  In fact, it’s the very offer of money, and nothing more, that actually dissuades me from considering affiliate offers.  In effect, it insults my own worth, my sense of who I am and what I do, by presuming I could be distracted from my already all-consuming business ventures with the simple allure of money.

So, how do you build what I call “Channel Sales”–an indirect distribution model that’s more complex (yes, more sophisticated) than affiliate?  How can you know what will actually motivate a business owner you wish to partner with?  Simple: it’s their business.

Entrepreneurs toil endlessly growing their companies.  They have dreams in mind — some monetary, some altruistic, and some just plain fun and rewarding.  If you want to tap into that passion and use it for your sales growth, you have to align the two.  Figure out how joining your channel will not only add a few bucks of commission to their bottom line, but will actually help them drive their business on to what they most desire.

You can see this principal employed in many of the successful channel sales models today.  Ad agency, for example, is a model where publishers seek to fill insertions, but they recognize the agency’s passion is for the creative solution.  Savvy publishers find ways to augment that goal.  My first job was selling software for a local Autodesk VAR.  I was baffled as to why Autodesk charged double the standard rate for services, until I realized that they wanted to encourage customers by whatever means possible to engage the local VAR for services.  Even my own Partner Provider program is built on what I’ve learned from these pros, and others.

Building a sales channel isn’t easy, and it is very rarely a fast process.  If you want fast and easy, get the affiliates on your side.  If you have more on your mind than money, then recognize that so do we.

3 Comments

  1. 1

    Great post, Nick! And welcome to the Marketing Technology blog. I believe one big mistake that many companies make is not monetizing the fantastic networks of vendors and relationships they already have. Building sales relationships that are rewarded through the very people you buy from as well as the clients you work with can be much more fruitful than simply throwing up an affiliate program where the individual doesn’t have any skin in the game.

  2. 2

    Hi Nick,

    Great post! At our company, Channel Services Group (CSG) we have recruited thousands of channel partners for large technology companies. To create and develop a successful, strong, dedicated channel our company has found recruiting the “right partners,” enabling partner success and retaining involvement increase partner performance and channel behavior.

    While recruiting, vendors need to make sure they are spending their time wisely by recruiting the “right partners.” We have seen several companies decide on a goal to add partners for a year, acquire the goal, and find themselves a year later with little revenue generated from newly added partners. Vendors need to make sure they are recruiting partners who have your company and best interest at stake and want to enroll in long-term benefits with the company.

    In addition, vendors need to enable partner success by validating the reason for partners belonging in the program. This includes high- touch communication with partners to train, engage and guide partners in go-to-market campaigns, vendor sponsored events, awareness campaigns and accelerating their sales cycle. We recently wrote a case study with an ROI of 14X as a result to building a channel program. You can read it here http://www.csgchannels.com/CaseStudies/case-studies.html.

    Lastly, our company has found retainment to be incredibly important in building and maintaining a channel. This includes nurturing the relationship with them while managing their success. Partners should be rewarded with incentives to amplify company goals.
    As you pointed out, building a sales channel isn’t easy and it is rarely a fast process, but it can be rewarding and beneficial when done correctly.

    -Joby
    http://www.twitter.com/CSG_Channels

  3. 3

    Great points. The right partners are not only more productive, they’re less of a pain. I can’t explain it, but I’ve found that when someone fits the model well, they’re less of a pain. The one’s we tried to squeeze into the wrong mold ended up sucking a lot of time.

    Also, speaking of high-touch programs… I’ve told it like this: in my business, I have 17 customers that I need to serve. It’s no coincidence that I have 17 Partner Providers. It’s not that I don’t need to serve all 1500 users, its just that if I serve the channel, the rest will take care of itself.

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