Exploring the 3 Ps of channel

Exploring the 3 Ps of channel

Most organisations consider an indirect channel as the fastest and the least cost route to market. A channel driven model enables you to reduce your direct investment in a large direct presence and teams to gain market share as well as to acquire a large customer base.

While the above is normally true, it doesn’t mean that the acquisition of a partner reduces the effort required to sustain the necessary channel relationships or the various other efforts and initiatives essential to penetrate any market. Further, it may not be the best route for all products/brands/geographies.

Over the years as a distribution manager, and more recently as a go-to-market (GTM) advisor, I’ve met many vendors who believe that appointing a distributor or a channel partner was sufficient to penetrate a market. They assume that the appointed channel would take the necessary initiatives, on their own, to penetrate the market.

One of the recurring thought processes that I came across was that a channel-driven model would yield faster results and revenues. And if that wasn’t happening (which was in most cases), investments into the region and teams were reduced or discontinued altogether after a period of time.

According to me, while both premises are highly incorrect, I would like to explore the second one – the expectation of immediate or quick results and revenues from a channel partner.

A channel-driven approach requires, what I like to call, the three Ps: planning, perseverance and patience.

1. Planning:

I am sure that business and market penetration plans are built by all organisations as a mandatory aspect to their strategy. However, it is crucial to continue to keep them in mind from two aspects:

a. Agility: Adapt the plan to the market, be cognizant of your peers and competitors and keep on reviewing to check if the overall plan was executed the way it was planned and modify immediately what didn’t work. Most organisations, unfortunately, stick to the plan if it isn’t yielding result. An agile and a work-in-progress plan helps tweak the activities, keeping in mind the end objective.

b. Localise: This is known and understood, yet over the years, we have organisations unable/unwilling to localise their action plans with words such as “This is a global initiative and can’t be changed” or “This mandate has come from the corporate/regional HQ and hence can’t be tweaked”. Each market/country/region is different and needs to be addressed with its own nuances. If the plans and initiatives aren’t localised, they stand a high chance of failure.

2. Perseverance:

Sometimes the biggest error a Channel Manager makes is in mistaking that channel partners are part of his team and treating them just like employees. They are not! Almost all channel partners are either reselling or servicing other products and brands. They’ve added your product or brand in the anticipation of enhanced revenue/profitability, but very rarely would they stop selling/servicing all other brands and focus on only your product/brand.
This means that their mind share is divided and more skewed towards the brand/product, which yields the maximum revenue/profitability for them today.
Thus, it is very critical for Channel Managers to not give up on a slow-moving partner, but to persistently follow up, chase and support them to help grow your business and mind share in their organisations. Use incentives and other reward and recognition programmes to motivate partners to do more with you rather than threatening them with off-boarding or replacing with other partners. I would like to reiterate – they are not your employees. Their first and primary goal is their own revenue/profitability and your brand/product is just a medium to achieve it.
3. Patience:

This is one of the most critical traits required while embarking on a channel-driven route to market. It takes time to forge a new path: whether it is adopting a new vendor and its product lines or penetrating a new market or building a new partner relationship.

What may take your direct team days or weeks to achieve, in terms of account penetration or deal closure, you need to add twice that time to your timeline when you add new partners to the equation. It takes time for a new partner to understand your product, the related value proposition, the competitive landscape and so on. Hence, though in the initial days, a channel-driven route would definitely seem slower and least effective, the whole purpose of your channel ecosystem is to create reach and predictability over a longer and sustained period of time.

Additionally, I urge Channel Managers and teams to bear in mind: even if you’ve achieved good success from a few partners, don’t discard your overall plan to penetrate and engage with more partners. Continue with the effort, especially with some of the lower performing ones so that they can become your best performers tomorrow.

It is sincerely recommended that organisations embark on their channel-driven journey with a clear long-term plan and expectation. Rome, as they say, wasn’t built in a day.

To know what the Middle East and North Africa channel partners have to say about their ecosystem, download and read Enabler ONE’s annual Channel Speak Reports – the region’s only vendor and technology agnostic channel ecosystem sentiment intelligence report.

Nehul Goradia

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