Here’s a statistic that may not come as a surprise to you: More than
one-half (52 percent) of solution providers regret joining a vendor’s
partner program, according to the Channel Insider/Motorola Partner Recruitment Lifecycle Report.
The chief contributing factor to this discontent: vendors failing to
fulfill their promises to partners. Those promises, in large part, are
the delivery of technical, sales and marketing support, solution
providers say in the report.
While this level of disconnect and discontent may not be a surprise
to solution providers, we must ask who’s really at fault? Is it really
the vendors?
The evidence in two of the most recent Channel Insider research
reports points to solution providers not taking enough responsibility
in driving their own destiny. The data indicates that solution
providers are not only reliant upon vendors for marketing and tech
support, but have an unquenchable expectation that vendors should
provide that support at little or no expense to them.
Consider this: solution provider’s most desirable trait for a vendor
partner program is high quality pre- and post-sales support. The range
of this kind of support spans everything from lead generation to field
engagement and deal crafting to post sales implementation and project
management. As one vendor told us, “we have more sales engineers than
we have sales people.” The cost of pre- and post-sales support to
vendors is enormous and can never be distributed evenly across a
partner base.
In the Channel Insider 2009 Market Pulse Report,
solution providers said two of the three things they need most to grow
their business is more leads and better leads. The acquisition of new
customers is vitally important to a business’ viability, especially in
tough economic times. Lead generation is expensive, and vendors spend
tens of millions of dollars on lead generation every year, and those
leads are often distributed to both enterprise sales and channel
partners.
As the Channel Insider reports indicate, solution providers are
dissatisfied with both the volume and quality of the leads provided by
vendors. At a recent distribution conference where I was speaking about
market trends and how they affect solution providers, I asked a room of
about 70 resellers how many were doing their own lead generation. Only
two hands went up.
Several vendors and distributors have deployed tools on their
partner portals to track end user license lifecycles. As the license
approaches expiration, the system will report to solution providers the
sales opportunity for renewing or upgrading the software. It’s a
brilliant, low-touch system that is far more efficient than trying to
track customer licensing on a rudimentary spreadsheet. But guess what?
Vendors and distributors say solution providers rarely take advantage
of the tool and often require prodding to engage with their own
customers. You can forgive solution providers of not wanting to take on
the expense of lead generation, but there’s no excuse for not engaging
with an existing install base.
When asked why they would join a vendor partner program, solution
providers said they were looking for new product with higher or
sustainable margins. The data from both reports indicate that a great
number of solution providers look to add new products and suppliers to
replace products that have reached saturation install bases or have
commoditized products. Solution providers say they want products that
are both best of breed and certified as interoperable. And yet, they
complain later that the technology did not work as advertised.
Of course there’s always going to be some misrepresentation and
embellishment on the vendor’s part as to the quality of their
technology and products. Partner engagement is salesmanship in another
form. However, solution providers spend months meeting with vendors to
evaluate products and partner programs before signing up. Shouldn’t
proof of concepts, product testing and reference checks catch
interoperability issues and performance shortcomings?
No doubt vendors must do a better job of framing the argument for
adopting, investing and supporting their products. The preponderance of
responsibility squarely rests on their shoulders to make the case for
Box A over Box B. Vendors need to nurture their channels and end users
markets to ensure that there’s both demand and sell through of their
products. And vendors must provide the advance technical support and
sales guidance to ensure their products are both installed and
supported properly.
That said, vendors are not responsible for ensuring the
survivability of their partners. Solution providers should and must put
more skin in the game when it comes to their own success. The Channel Insider 2009 Market Pulse Report found
that solution providers investing in their own futures, expanding their
markets, doing their own lead generation and acquiring new customers
are more profitable and optimistic about their futures.
Solution providers and vendors have a symbiotic relationship, in
which one is dependent upon the other for their survival. The balance
of this relationship is skewed in favor of the vendor, since most
vendors can survive even if scores of solution providers fail. Vendors
know this and are actively looking to cut their channel costs by
focusing only on the solution providers that deliver the most benefit
for the best investment on their part. If solution providers want
success, it’s incumbent upon them to reduce their dependence and
expectations of vendors and take command of their own destinies.
Lawrence M. Walsh is vice president and group publisher of Channel Insider. Read more of his research reports at [CI] Perspectives.
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