Top 8 Questions I get asked about Partner Programs and Partner Enablement

Transcript

[00:00:00] Alex Glenn: New business expansion.

[00:00:08] Welcome to make them famous. The podcast about partner enablement, the only podcast uncover both how partner teams enabled their partners and how other department leaders enable their partner teams to achieve success. Hello? Hello everyone. This is Alex Glenn. Your host of make them famous today. We have.

[00:00:29] An atypical episode, not something I've done yet, but I've received so many of these same questions recently. And I feel like these are the ones that confuse most partner teams, as well as digital agencies, MSP partners around the topic of partner enablement. The FAQ's, if you will, these are some of the ones that I get asked the most that I'd like to answer today in about 15 minutes to deliver you some value.

[00:01:00] Number one, what are the most attractive partner incentives in order? Number two, do commissions matter. And remember, we're talking about digital agency partners. Number three, can a poor product still win partnerships over a superior product. Number four, do agencies or tech companies need a partner manager to succeed in creating a partner program.

[00:01:27] Number five, when do you need a PRM and needs in quotes again? Number six. What minimum criteria does a partner need to possess to be ready for partner operations? Number seven, how can I ensure ROI from co-marketing with partners and number eight, how agencies and SAS can affectively Cosell. Those are the questions I'm going to answer in this episode, but first a word from our sponsors for sponsorship we aimed for not only great products, but tech use to power.

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[00:04:04] All right, let's go ahead and answer these questions. Number one, what are the most attractive incentives in or incentives for digital agencies? Well, based on our research and I'll link to a report in the show notes agencies appreciate and stay in partner programs based on these insights. First and foremost referrals and warm introductions from their tech partners.

[00:04:27] You can keep just about it. Any agency you want, if you are consistently bringing them referrals, now referrals don't have to be through an email introduction. Referrals can be from your directory. They can be from your co-marketing article or event or webinar or whatever you did together. They don't have that.

[00:04:47] Those direct email introductions. The partner just has to be receiving business from your partnership, from stuff on your side, from your assets, your website, your SDRs, your team, number two, support and training from their team. They're being the tech partner. They need to know that if they're going to partner with you and double down on business, meaning refer their clients, the clients that they love as their own child.

[00:05:15] If they're going to refer them to you, are you going to support them and make sure their team is able to provide excellent service? That's number two, number three co-marketing and co-selling as a general operational practice. Are you doing stuff together? That's what I like to say. So when you start the partnership, you're not sitting there saying, let's train you up and let's get you signed up in this contract, in this portal.

[00:05:43] And it's do all that stuff that is obligatory things that you have to do to make sure that they can operate as a partner, but above. Are you doing stuff together to put both of you in front of more people out there on social and in newsletters and on your blog, are you doing stuff together? And then the second piece of that is are you actively co-selling with these agencies?

[00:06:07] Are you getting on the phone with them helping them win business? Are you mapping accounts? Are you in a co-selling agenda with these agencies? That's number three. And number four was commissions. This is number one on some of the expectations, the list of mental expectations for many CEOs out there, especially they think I can launch a partner program and put 10% or 15% and put words like perpetuity and wind partners.

[00:06:37] What commissions do for you? If you make that the main premise of your partner program is. Vendors when affiliates, these, this commission offer will simply make the agency think in their heads. How, how many people have I referred to this company? And can I go backwards and gather up those commissions? It effectively creates debt collectors for you and your product.

[00:07:02] So, uh, the proof is in the pudding. We did the interviews. We ran reports. Commissions was very low and think about it like this. You can imagine, even if the agency is small, the amount. Of commissions you would have to pay out on referrals from your product would have to be pretty large in order to make it even show up as a dent on the balance sheet.

[00:07:27] Uh, finally, and this is something that's bare minimum that you have to have before you even talk about incentives. Your product has to be demanded or used by their ideal customer. Profile. So that's actually above everything. Your product has to be demanded by their ICP. If they're having to sell hard, when they get on the phone with their customers, meaning, sell your product hard.

[00:07:52] And it's not something that their customers are wanting or even interested in. That's a, of course not going to work for either party. Let's go on to number two, do commissions matter. So I hit on this and I'll just reiterate some of the points that I made. Uh, the answer is no for 95% of the listeners.

[00:08:15] The reason is your commissions only start to matter if your ACV, your average customer value is high and high. If I had to put a number on it, I'd say 10. Or hire 10,000 us dollars or higher you find these ACVs and products like HubSpot's Salesforce, Shopify, Contentful Pendo optimized, lead sales loft.

[00:08:38] Yeah. Drift is even getting up there, right where the average customer value is very high into the five figures. And plus, if you were to rip out those commissions, those yearly expected commissions from a typical HubSpot elite. Of course they would be pissed off. But if you talk to most HubSpot elite partners, commissions on their balance sheet is very low.

[00:08:59] They maintain close relationships with HubSpot because mainly the support, the training, the referrals for many of them, I would say some of them, not many, but, um, the co-marketing all the stuff that HubSpot does, uh, with them. Those was things that they're doing together. But even then, They are never a large part of the agency's total revenue.

[00:09:19] That's the main thing. Uh, we did a poll in the agency community and the average was below 5%. And that's of agencies that have one or more tech partners, their commissions were below 5% of their total revenue. So just remember that moving on, number three, can a poor product still win partnerships over a superior product.

[00:09:43] This is great because I get inbound all the time from different tech companies at all different stages in their growth. And what I like to say is this, like over the last 10 years, right? Meaning 2010 to today, or even let's go back another 20 years, right? 2000 to today, you have to think of these big partner ecosystem.

[00:10:04] Right. Like Microsoft, like even HubSpot, even though HubSpot's, you know, 10 years to today, HubSpot's one of those HubSpot was actually terrible product for a very long time. And most of that time that it was a bad product. They were rapidly growing their partner program. They did this. Because of all of the things that they were able to do for the agencies that was not product dependent.

[00:10:30] Right. All the training and support and teaching them how to sell and offer these services. It was great. So the product didn't really, it had to be there of course, but it wasn't great. It wasn't good. There were other better products. Uh, finally HubSpot. You know, become a very good product. I would say today, it's a great product, but it took a while.

[00:10:49] And during those rapid expansion years, they were actually not a great product, but although it has to be done. Uh, sorry. Although it has been done in the last decade, I'd say with the HubSpot example, part OD is another example, terrible product. Uh, today is very rare because number one products are getting so good and so robust that it is nearly impossible for an agency to sell their clients an inferior product.

[00:11:17] Number two, I'd say the adoption of new technology is becoming much easier and faster. With self onboarding, the support, and even some companies offering implementation services by the product itself. Uh, so any head of sales, head of marketing CMO can task one of their team members or do it themselves to set up.

[00:11:38] They don't need that implementation partner, that expert in the product. Um, that's today, SAS is just getting really good. So it was very hard to win partners with a bad product. Now, the caveats to this. First products that a have agencies as users and B inherently require the participation of multiple companies who then launch a program can inherently have partners.

[00:12:14] Good example of this is monday.com. Not saying monday.com is a bad product, but the pure example of how Monday's product works, where I'm an agency user, most of their users are agencies. Now when they launched their partner pro. All the agencies have to do is sign up. I think they did a case study about this $30 million with a hundred partners, but let's unpack that a little bit.

[00:12:40] Let's see how those partners have to operate monday.com and you think of it almost like a pyramid. Like I joined monday.com. And the first thing I do is create my team, invite all my team. Let's say I'm a typical agency. 30% of my team is going to be freelancers contractors. They're still going to be in Monday.

[00:13:01] Right. But they're also working for maybe five to 10 other clients. So they're bringing Monday into those clients and the pyramid begins. Right. But then I invite my clients because I create a web development project. And I want my clients to participate in that. Now I'm inviting my client. The client enjoys the experience of monday.com.

[00:13:22] They purchased an account. And so do the people that the freelancers that were on my account, uh, they brought it into other companies as well. And the pyramid begins right. monday.com is product is the reason for such a rapid expansion and so much revenue coming from partnerships. All they had to do was pick out the top 100 users of Monday, call them partners flipped.

[00:13:47] And all of a sudden they're building pyramids, right? They're building those commission pyramids, um, and revenue pyramids. So that's caveat, number one, caveat, number two, white label products like go high level, love the guys that go high level. They built an awesome product, but it doesn't matter if it's better or worse because they, they give the agencies the opportunity to manage all of their clients, digital marketing in one platform, and then they can build the partnership program.

[00:14:13] To have solutions partners that maybe help other agencies. I'm not entirely sure how it works. I do know they have something going on. HighQ. SEO is in this ballpark as well. They sit behind the scenes. So the agency. That operate these white label tools don't care. If active campaign is a better product because active campaign doesn't allow them to white label to be, uh in-between.

[00:14:35] So for agencies like white labeling, you know, the products in that white label bucket are typically inferior, uh, but they can grow their partner programs quickly, uh, caveat number three, for products who can essentially buy purchase their partners, pay them to become implementation partners in place of hiring CS reps, et cetera.

[00:14:54] Of course that may persuade some agencies to join, but finally, caveat number four, if the solution merely wants affiliates and they are very, very good at Martin. They will probably when digital agencies, I'm thinking about Adobe products in here, uh, you know, the product itself clunky, too, bloated all this stuff, but of course, they're excellent marketers.

[00:15:21] They have the money, they can launch an affiliate program. Same with NetSuite, I think is in this bucket too. And, um, they, the only thing is I wouldn't confuse that word affiliate with partners. So that's the iffy, you know, number four caveat there, but today terrible products will not maintain an expert solutions, PR partner ecosystem for long.

[00:15:43] I just haven't seen, um, now I think we're at number four here. Do agencies or tech companies quote. A partner manager to succeed in creating a partner program. Uh, this is a tough one. Uh, I'm going to answer this as no. And I tell people this I've worked with CEOs who have successfully activated, enabled enough agencies to say they have a viable partner program and start to grow it without any partner managers.

[00:16:14] Um, Scott it up, content seen at tap cart. Um, I'd say Pete Kaputo Databox he's the founder and the godfather of partner programs started HubSpot's partner program back when, uh, he has built data box and their entire operations around agency partners, their content system, their product itself, the website.

[00:16:36] Yeah. How users interact with their product is all with partners included. So they don't need a partner manager because the whole system is built around partnerships. It's it's as simple as saying, do we need a partner marketing manager to create articles and events? No, the COO or the head of content or the head of marketing is simply instructed to make sure partners are included.

[00:17:02] So you don't need a partner manager in that world. That's what he's built. And it's very, very cool what they've done and the, I hope they do a case study on it really, honestly. It's incredible. Um, so moving on number five, when do we, and this is we, as in, you need APR, I'm guessing this is a tech company listening to this answer.

[00:17:27] If you're an agency, try to fit it in. Your situation. But my short answer is you need a PRN if, and when you have a commission centric program, an affiliate or referral program, and I'm talking to PRMs in general. So everybody that sits under this PRM umbrella, I know PRMs, like Allbound, don't actually have payouts and commission as a feature, but most of them do so for the bulk of PRM as a category, you need it.

[00:17:57] When you have a commission centric program. With tiers, multiple tier types. And this is fully orchestrated through sales. And most of the activity has to have checks and balances in the CRM because it's a commission centric program. And this is back to the commission idea. I've been helping companies build programs that are not commissioned centric.

[00:18:23] And we see examples again, data boxes, one of them, they don't pay commission on it. You do not need to pay commission. If you pay commission, you're opening up a can of worms, which is you need a PRM at that point, you need to deal with channel conflict at that point. And it becomes a nightmare. So I believe most SAS out there that are listening, do not need to pay commissions, which means you will never need a traditional PRM.

[00:18:47] Now, the other PRMs that are coming up that allow you to do more stuff like that. Marketing automation and co-marketing management and some of the front facing partner, branded portal stuff. You know, those come into play when you have a very robust program, but for the first year of most programs, I'd say no.

[00:19:09] Uh, if you believe you have the inbound requests to justify a, an affiliate program, they're asking you for an affiliate link and you just want to give them that affiliate. There are $50 a month products that you can generate affiliate links and go nuts. So very rarely do any partner programs need a PRM and the need, the, the word itself, um, also has to, has to bring in the thought process of budgeting, right?

[00:19:42] You say, need, do you need to spend 20 grand on a PRM? That's what I'm talking about. Uh, if you need affiliate tracks. Then it's a matter of, okay. Maybe it's $600 a year for a lightweight affiliate tracking solution. So need of a PRM, I'd say no until you have 100 plus very active tiered and affiliate based, uh, referral based programs.

[00:20:07] Uh, but more and more SAS or replacing commissions again with non-compete compensatory incentives, like pass-through discounts, increase, support. Co-marketing co-selling. So if you're building a part, a program based off non compensatory incentives, uh, check out selfish plug partner, hub.app. That is the partner management platform, nothing to do with commissions or payoffs tracking.

[00:20:31] I think we're at number six. What minimum criteria does a partner need to possess to be ready for partner operations? Okay. So for tech companies only answer this for tech companies first, uh, you have to have a solid product that is demanded by a lot of companies for agencies. You have to have a growing client base with at least I'd say six months, average retention on retainers.

[00:21:04] This means your clients trust you as the agency. So I'll repeat that for tech companies listening, you have to have a solid product that is demanded by a lot of colors. That could be the very first litmus test for am I ready for a partner program from a company people disagree and say, no sales has to be buttoned up and operations.

[00:21:25] And all this stuff has to be in place on the sales side, mainly to support a partner program. Hell, no. Uh, I'm gonna refer to data box again. I don't think they have a salesperson on their team today and they grow at 300%. I forget what they're a head of marketing post to the other day, but they're, they're crushing it.

[00:21:45] And they have yet to hire a salesperson or maybe they just hired their very first salesperson and they have built everything on top of the partners. So for those of you that think you need to have sales buttoned up to have a successful partner profile. I I'd argue the opposite. You should have your partner program buttoned up before you start a large sales team.

[00:22:06] Um, and then most will tell you that the partner needs to be able to sell, to have a strong sales operation on the agency side. So for agencies listening, um, my adjustment to this is to say the partner, the agency needs to be able to close. Not necessarily sell, but close. I've seen agencies that are great partners that don't have a sales team.

[00:22:30] They just have strong thought leaders and some good PR meaning anyone that sees what they recommend software, they recommend will take it. And at least, you know, give it a look at least because that agency has so much technical cloud, um, Now for products, strong product will sell itself. I've seen many partner programs just, uh, just basically ride on the back of the product team, which is sad for the product team.

[00:23:05] You know, companies like Monday, uh, this case study that they put out. I mean, this is probably controversial as well, but I'm going to say, I think the product is responsible for. The majority of the revenue from the pro, uh, from the partner program because of the product is built to create those shares and those referrals as a, as a product onboarding feature and as a product use feature.

[00:23:29] So, um, so look closely. It really, what is product driven partners? And what is human driven partnerships? Um, from there, I will say team alignment is critical. The team has to want to work with partners and have partners involved in as much as possible from product to marketing in order to succeed in partnerships.

[00:23:51] I'll say that again, team alignment is critical. Moving on. I think we're at number seven. How can I ensure ROI return on investment from co-marketing with partners? Uh, the co-selling answer. I'll answer, uh, next. Yeah. But talking about, um, co-marketing ensuring ROI. So you can, you can never ensure ROI with the first co-marketing endeavor, even any of them.

[00:24:18] So you're thinking about doing co-marketing with partners. The typical, easiest, low hanging fruit is doing content with partners. If you do a partner sourced piece of content on your blog, does it bring in more leads than your typical written by someone in house on a similar subject matter? My argument would be any third party sourced expert third-party source piece of content should convert.

[00:24:47] From my VP of marketing days in my experience, they did. Because if you think about it, user coming to the website, they see you guys talking about something that clearly promotes your products, use case. You're going to look at that as bias, but if I see how digital agency XYZ increased leads by 20%, 50%, whatever, using your product, plus Google analytics.

[00:25:13] And then that article was a step-by-step guide for how they did it with screenings. Holy crap. I would, I would convert off that all day long. Right? So there's things that your team cannot even create like that use case specific content, because they're not an agency trying to help clients using your product.

[00:25:34] You guys are on the product owners. So when you talk about. Ensuring ROI. The other word is attribution. How do you attribute that ROI from co-marketing? So my suggestion to this answer is co-selling co-selling, we'll go into a little bit more, um, the next and final question, but what you want to get is a source of attribution.

[00:25:54] You want to see right off the bat before you do any big co marketing endeavors with that agency partner or that tech. You want to see who do we have in our account, in our pipelines that we're both selling to today? How many total? So we have, let's say, as an example, the agency brings 500 accounts to the co-selling software.

[00:26:15] The software should have way more. So let's say software has 10,000 accounts that they're bringing the middle of the Venn diagram, the overlap. Those leads that you're both selling to. Let's just say it's 10 when you start. Right. And then there's people on either side. Um, well, you're going to monitor that.

[00:26:35] Before, and after you produce your co-selling content, so you're going to have 10, you're going to run that webinar. You're going to publish that blog. You're going to let it kind of get some traffic and some impressions. And you're going to see, because you've marketed that blog to both of your audiences.

[00:26:51] That's the other part of this co-marketing means tech partner has to publish that on social linked to it, tag the agency, put it in their newsletter, put it in their blog agency has to do the same thing. If that co-marketing was effective, you'll see your overlapping pipeline increase. Then it's just a matter of how much pipeline value is there and how much did that event or piece of content costs.

[00:27:16] So that's an easy exercise to run, but it requires account mapping. Now, final question, how agencies and SAS can effectively Cosell together. So how can agencies. Effectively Cosell together. I'll say technology replaced SAS with tech for any of you out there. So the underlying issue with this is there isn't a software out there helping to educate agencies on co-selling through marketing blogs or training.

[00:27:48] They're not being helped. Right? So agencies. I think it was in our poll. We did another poll on the agency, collective 4% of agencies that answered this poll had effectively co-sell co-sell using a software that was built for account mapping and co-selling like reveals as a great tool, reveal.co, check them out.

[00:28:10] Um, now. That means 96% haven't used the software. A reason for that is not because it's expensive because reveal is free. You can sync your CRM and use reveal for free. So it's not because it's expensive. It's because the software aren't marketing to agencies, they're marketing to other SAS companies to use the product.

[00:28:31] And then that product goes into the sales team, sometimes partnership and sales, but let's just say it goes to the sales team as a coach. Product and the sales team are using it, but they're not using it with agency partners, even if it's on the partnership side. The first use case for co-selling is with technology, strategic partners.

[00:28:49] So agencies just aren't brought into that for the most part. So how can you effectively Cosell with an agency that will, first thing is you've got to educate them. We're helping with this, but you guys have to help too. So have a all hands webinar slash meet up with all of your, uh, agency partners, walk them through how they can Cosell.

[00:29:07] And what the routine is. Um, the second thing is most agencies don't have a trained sales leader who learned to Cosell at a previous tech company. Like your tech companies, apologies, love to get rid of that. Like your tech companies do. So you think about this. If I'm an agency and my head of sales has never coached.

[00:29:32] I'm just going to leave it right there. I'm not going to push them to Cosell when they have never done it, they have to do their own education. They have to get comfortable with it. They're my head of sales. They're going to do what they do to hit their numbers. And if they're not comfortable, co-selling, it's just not going to happen.

[00:29:49] Um, so number three is according to a poll we ran. Um, and this is the data that I just mentioned. So skip that I have these notes written down, but I mentioned that 4% of agents. Effectively, coastal using a tool. So the education part, um, so how the, how of this education begins with nurturing your partners into understanding why it will bring them new business?

[00:30:12] Right. So I mentioned scheduling an all hands partnership type call. Awesome. But you want to make sure that you're warming them up to the idea of, even though I'm the one introducing you to co-selling it's going to benefit you. Here's how the operation is going to work. So you want to make them feel comfortable.

[00:30:31] So what I suggest to all my teams is a, or number one, step number one, set up co-marketing campaigns with your partner. Step two, before those go live map accounts to have a source of attribution, number three, suggest warm intros. That's an easy next step. You see people in that center of the Venn diagram, those map to counts that are overlapping, go down that list of URLs and see where they're at in each of your pipelines and what you can do to introduce each other.

[00:31:06] Number four, strategize, more focused campaigns. To account base count base, sell those in the peripheral, right? The peripherals outside of the middle of the Venn diagram, those are leads that are in their pipeline, but not in yours, right. Are yours, but not in theirs. You need to be very strategic about those.

[00:31:28] Have your partner team and your sales team get together and analyze all of those leads that are in yours. Pipeline, but not in your partners. What do they have in common? What is relevant with relation to the types of partners you have and their needs, and then formalize an account-based approach to get those people, to see, or partner directory, right?

[00:31:51] To see that content that you just published with that partner to find out what their needs are, and then get with your partners and say, most of them are this type of company they're going to be in this phase and they're going to need this type of content and this type of. And then have the agency, put it back on them to bring you that type of content, case studies, videos put together events related to what those pain points are.

[00:32:12] And account-based the crap out of that side of the pipeline and have the agencies do the same, go down their list of all the leads in their pipeline that aren't in yours and pick out the ones that would be great for this person. And then sit with you on calls and strategically figure out how you can be in front of them, what type of content that they would need and what type of offers pass through discount type offers they would need under the agency would really need to be comfortable making the introduction, but at least have that content marketing going so that co-selling can be that routine.

[00:32:50] So the last thing I would suggest doing is setting up. Yeah. Monthly or quarterly, depending on how often and how busy it is for you and how attractive co-selling is for your agencies, but set up a periodic recurring standard. Just based on account mapping and going down the list and seeing who's new in the pipelines that can be made a warm introductions to, and then also reviewing those domains to figure out some account based marketing co-marketing that you can both create.

[00:33:23] To help move those pipelines to the middle. So those are the eight most asked questions that I get around partner enablement. Most of the polls that I mentioned will be linked below, but if you'd like to start your own poll or just ask a quick, quick question, if you're an agency, head to community dot partner programs.io, and post a quick question there in the newsfeed and we'll answer it.

[00:33:49] If you are a tech company, Collective dot partner programs.io, posting the top of the newsfeed and I'll at least answer and I hope other people will jump in and answer as well. And we'll get some good data together. That's that guys? I hope you enjoyed it. I will, you'll hear me on the next episode of make them famous in the battle.

[00:34:12] Thank you.

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