Optimizing Long Tail Channel Partners
In my previous blog, “Structural Considerations When Engaging Long Tail Channel Partners”, we identified five factors that could be impacting a vendor’s ability to engage the bottom 80% of its partner network. Subsequently, here we discuss “Optimizing the Performance of Long Tail Channel Partners”. We look at how to mine your partner community for untapped opportunity, by identifying what to look for and exploring what to do.
Territory Analysis: Who’s Doing What in Your Target Markets
The absolute first thing to do is identify the value (both quantitative and qualitative) the long tail partner delivers to your business. This begins with a territory analysis.
We all know from experience that the partners we want, and need are not necessarily the largest partners. You know the ones with the greatest sales volume or even those with the greatest depth and breadth of certifications. These partners are definitely important. But, if we only focus on them, we can be underperforming in key industries and geographies that are dominated by smaller players.
That’s why many vendors proactively deploy their channel sales teams in regular and rigorous territory analysis. This effort captures the value of ALL the players in a vendor’s key market and identifies:
– The degree of partner fragmentation or concentration in a market – be it a vertical, a region (such as an MSA or CBSA in the U.S.) or, usually, a combination of both
– The full market opportunity
– Partner shares within the market
– Competitor share within partners
Armed with this data, vendors can answer several key strategic questions:
– How many partners deliver 80% of the opportunity in this market?
– Who are these partners and what position do they have in our partner network? (How many are in the “long tail?”)
– How are we currently engaging with these partners?
– What is our share of their business? Has it grown/declined/ or remained roughly the same for the last 2-3 years?
– Who are our major competitors in these partners?
– Which, if any, of our current partners are minor players in this market? How are we currently engaging with them?
This output creates a short list of key players who account for 80% of the opportunity in the analyzed markets. Sometimes this list can be very short. While other times, it is much longer than you would expect. From there, a vendor can determine how closely its top partners map to the market – AND identify ALL of the relationships required to be successful. In this blog post, we’re focusing on optimizing the long tail partners in this group.
Tactics for Optimizing Long Tail Channel Partners:
Where and How to Maintain vs. Invest
Once you are clear about who within the long tail delivers real value, you can use your partner profiling data to align your investments in channel management resources, processes and programs. Typically, there are three main partner “segments” to consider and three tactical paths available to pursue:
In short, the process of understanding and optimizing long tail channel partners can be a major initiative for the channel team – especially if several years have passed since the network has been analyzed. Powerful channel management platforms such as Channel Mechanics can dramatically reduce the time required to capture partner profile information and to design, deploy, monitor and refine very targeted programs and promotions. The consequent improvement in long tail effectiveness should be significant.
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