Here at Managed Sales Pros, we’re helping to build the partner channels of several different vendors at any given time. At 22 dials per client per hour, plus our own outbound calling, we talk to more MSPs every day than most companies, and we learn a little more about the market with each outbound dial. We write a lot of content for MSPs, but today I wanted to share some information with our vendor audience on the trends we’re identifying.
We have seen and offered it all – free products, deep discounts, contract buyouts, MDF offers and more. We participated in some of each last year, and we have an interesting story to share.
Last year, we helped a manufacturer launch their new channel-centric distribution company. What’s great about this particular program is it was for a brand-new channel company, so there was no market perception – positive or negative – at the beginning of the campaign. Their strategy included the offer of a free product to thank their new partners for signing up. This was a very rich offer, a piece of hardware with a $200.00 retail value – and it was theirs to keep, as a thank you for signing up with our partner.
Using this strategy, our client saw some fast and furious partner acquisition. As the company made further channel building investments in trade shows, their brand recognition increased, and their partner sign-up rates using outbound also increased.
4 months into the program, this client had secured hundreds of new partners through their outbound campaign. This should be a reason to celebrate, right? Wrong. Their conversion rates had stagnated, and while their signups continued to grow, their new partners weren’t making purchases. We suspected the reason for the poor conversion was the “free offer”. People who had no intention of buying still signed up for a free product, and why not? It was a fantastic offer, for a great product! We suggested our client remove the rich offer from the pitch to focus on recruiting new partners who saw value in a partnership with a great company, not in receiving a free product.
As expected, taking away the freebies meant that partner signups slowed initially, but conversion rates increased steadily.
During this time our client made what I think was their most important decision. They added head count to their support and on-boarding teams, which meant these brand-new partners now got more immediate live touches through their on-boarding experience and more personal support when they went to place their first orders. By this time (month 6), partner signups through our outbound program had reached over 1500, and that’s when conversion really started to accelerate.
What is this saying about what partners want? More than free stuff, they really want someone to engage with them. Many vendors are trying to automate their on-boarding and buying process. This is short sighted. Vendors should be focused on building the things that make it easier for their partners to BUY, not on building things that make it easier for your team to sell. Partners want support through the on-boarding process, they need sales support and sales education, and they want you to make it easier for them to buy.
Conversion rates aside, one of the things that made is easy for us to sign up partners for this program so quickly was the level of general dissatisfaction in the market. MSPs shared with us that they were tired of off-shore call centers, confusing rewards programs, and disparate levels of knowledge and support from their reps. What we hear most often in the market is “I’d leave but it’s such a nightmare.” We don’t hear a lot of “No, we’d never leave, they’re amazing.” To summarize: change pain, not satisfaction or loyalty, keeps MSPs from shopping around.
The market absolutely loved the idea of a new distributor. They were delighted with the idea that they could get next-day delivery OR a better product substituted if it wasn’t in stock. They loved the idea of US support and local fulfillment. But most of the time, they still couldn’t imagine trying to navigate yet another complicated vendor relationship. This company invested in making it EASY for partners to work with them. The original idea was that partners would receive their free product, see how great it was and start buying. What actually happened? The new partners received personal attention, saw how great THAT was, and then they started buying.
The MSPs that are looking for the best solutions, who are ready to make a move but won’t do it at the expense of internal chaos – those are the partners that vendors should want the most. They will be the most resistant to fancy baubles. They’re not going to be razzle-dazzled by quarter-end pricing or free hardware offers or that magical third tier with MDF for days. What will win their business? Offer them the support they will need to make those painful changes. Engage with them instead of pushing them to self-service portals. Vendors who want to sign these MSPs should stop automating and start creating real relationships. Focus on cultivating a true partnership with the MSP who wants a premium offering that will include as much time as they’ll require to make the partnership successful. You may sign fewer partners, but you’ll sign the right kind of partners, and your conversion rates will skyrocket.
Want to learn more about Managed Sales Pros pay for performance partner channel recruitment programs? Reach out to Tracie Orisko at 204-572-5072 and she’ll share how we’ve helped companies including OpenDNS, Datto, AVG Managed Workplace, Aisle8, N-Able, LogicNow, Mail Protector and Cirius Messaging grow their partner channels.