The Evolving Role of Channel Marketing Presented by Channel Management Professionals 1
Objectives • To help the Channel Marketing team create a “baseline” for the channel marketing function • To identify areas of potential interest and growth • To discuss how roles can/will evolve • To identify how stakeholder requirements may change 2
Agenda • An Organizational Perspective – – How/where channel marketing reports Different models and rationales Pro’s and con’s Trends • A Functional Map – The “roots” of channel marketing – The “gray zone” -- roles and functions that may be migrating to channel marketing – The gaps – functions missing in most organizations – The borders – roles and functions that most likely will never migrate to channel marketing • Topics for discussion 3
The Two Faces of Channel Marketing 1 - to -1 initiatives Customized joint marketing initiatives for the “critical few” Channel Marketing includes both responsibilities Partner Program Infrastructure Consistent policies, requirements, benefits and management across a broad range of partners 4
Organization: WHERE Channel Marketing Reports is a Function of the Company’s Ability to Perform in a Multi-channel Environment STAGE III ? The three stages of channel organization STAGE I - a company has little experience/comfort with channels STAGE II - multiple channels well-integrated into the company’s culture and understanding STAGE III - cost is a primary driver of all organization design • move to centralized marketing • Keep as many customer-facing resources in the sales organization as possible 5
Organization: Stage I – Channels is a Separate Organization VP Marketing Product Corporate VP Channels* VP Sales Direct Sales Channel Sales Ops Channel Marketing Ops *In some companies, this title also has responsibility for Business Development/Alliances In the early stages of a company’s marketing through channels, many organizations give “channels” a separate organization: • Clean “line of sight” to and from senior management • Separate commitments to and from product teams • Ability to develop processes and policies specific to channels 6
Organization: Stage II – Most Organizations Quickly Evolve to a Single Reporting Structure VP Sales VP Marketing Product Corporate Channel* *Communications only A single reporting structure: • Promotes channel harmony Sales Ops Direct Sales Channel Sales or Channel Sales Channel Marketing** **strategy, programs, policies • Encourages joint planning and teaming • Uses support resources efficiently 7
Organization: Stage III – Cost is Driving Channel Marketing’s Migration to the CMO VP Sales CMO Product Corporate Channel Ops Direct Cost is driving scale and specialization decisions at every level of the organization. For Channel Marketing, this often means: Channel Strategy • A change in reporting to the CMO (a relatively new position created to emphasize the importance of marketing to the organization) • A renewed emphasis on professional tools and techniques that have been developed over the past 10 years 8
A Typical Channel Marketing Organization • Traditional functions within a Channel Marketing organization: – Field marketing (for each region) – Demand creation – Indirect channel marketing – Channel development – Global alliance marketing – Direct channel marketing 9
Functionality: Today Channel Marketing is Increasingly a Critical Bridge between the Product and Sales Teams • The evolution of the channel marketing function: THE ROOTS THE GRAY ZONE THE GAP THE BORDERS 10
Functionality: Channel Marketing’s ROOTS are in Communications Deliverable THE ROOTS Traditional Deliverables of Channel Marketing Communications • Newsletter Demand Lead Generation • Product reviews • Analyst briefings • Lead gen programs Sales Support • Sales literature & fee structure • Solutions reference catalog Event Planning • Trade show coordination • Cross channel events With help from: Marketing Communications Product & Solutions Mktng Marketing Services Marketing & Sales Opns. Product & Solutions Mktng Marketing Services Marketing Communications Marcom & Strategic Mktng 11
The Challenges to the Traditional Channel Marketing Organization THE GRAY ZONE • Market analysis and metrics • Channel satisfaction • Channel economic analysis Increasingly, Channel Marketing is called upon for some or all of the following deliverables: • Channel strategy definition • Process and systems definition and management • Reporting infrastructure development and management • Development of partner program and components • Channel relationship management 12
The “Gray Zone”: Increasingly, Channel Marketing is Called Upon to Centralize Activities Function Market Analysis & Metrics Historically Performed by: Market Intelligence –Competitive channel strategies and tactics –Shared market research Channel Economics -Functional compensation -Discounts, rebates, commissions, etc. New function – no one has historically done this, but it is becoming increasingly important -Trade-off analyses (Given equal effectiveness, which channel category costs less? ) Channel Satisfaction Surveys Channel Sales 13
The “Gray Zone”: Increasingly, Channel Marketing is Called Upon to Centralize Activities Function Channel Strategy Definition (global, recruitment, funding, differentiators) Historically Performed by: Channel Sales Process and Systems Definition and Management • Contract management Product teams and/or channel sales • Problem escalation procedure • Conflict management policy • Qualification process Sales operations • Co-op reimbursement system • MDF management • PRM system data management • Partner Hotline 14
The “Gray Zone”: Increasingly, Channel Marketing is Called Upon to Centralize Activities Function Reporting • POS (Point of Sale) – what specific customers the channels sell to • Competition • End-user names Development of Partner Program and Components • Training and Development –Product –Sales –Channel managers • Certification program • Technical newsletter • Discount Structure Historically Performed by: Sales Operations Sales Product/sales Product marketing Channel sales 15
The “Gray Zone”: Increasingly, Channel Marketing is Called Upon to Centralize Activities Function Channel Relationship Management • Advisory boards: –Product advisory boards –Partner advisory boards –Executive level boards (senior execs from both vendor and partner) Historically Performed by: Channel Sales plus: Product Marketing Channel Marketing 16
The Gap: Most Organizations Continue to Have Two Major Gaps in Their Go-to. Market Functions • End-user segmentation – understanding how target end-user segments purchase software: – – – Who What Why Where How When “buying behavior” segmentation • Channel Segmentation – understanding each channel’s underlying business model 17
The Gap: The Importance of End. User Segmentation • Who is buying • Decision-makers and influencers • Why are they buying • What are they buying • “product” vs. “solution” • Front market vs. aftermarket • When are they buying • Budget cycles, etc. • Where are they buying • Channel preferences ALLOWS CHANNEL MARKETING TO: • Identify the correct targets for marketing messages • Create meaningful messages • Develop powerful sales tools for the channel sales team • How do they buy • AVL (Approved Vendors List) • VPA • Centralized vs. decentralized 18
The Gap: The User-Defined Channel Template Sets the Stage for Channel Marketing’s Value-Add PRE SALE Demo Needs assessment POST SALE ONGOING Bundling Training Installation Updates Tech Support New product information Terms Config assistance End-User Requirements during the Buying Process Allows Channel Marketing to: • Recommend and develop appropriate channel selection metrics • Recommend and develop appropriate support programs • Track channel success by critical functions 19
The Gap: The Importance of Channel Segmentation • Channel size • Business mix • Product mix • % of revenue from our product category • Brand mix • Genesys share of category • Customer mix • Geography served ALLOWS CHANNEL MARKETING TO: • Set reasonable expectations for channel performance • Create compelling channel value propositions • Create program components that add value to both the company and the channel partner • Resource mix • Margin expectations 20
The Borders: Many Functions Will Probably NEVER Migrate to Channel Marketing Function Owner • Proactive Channel Recruiting* • Business plan development and management in the field* • Incentive Plan Program participation estimates • Channel advisory board relationship management* Sales • Technical support • On-line order entry and status • Budget to actual sales measures • Backlog management process • Product development Tech support Sales operations Sales/sales operations Sales operations Product/Engineering Sales Operations/Finance Sales THE BORDERS *Channel Marketing plays a key role in developing the infrastructure to support these activities. 21
Summary and Discussion The Roots The Gray Zone The Gap The Borders Where does the team fall on this functional continuum? 22
Questions for Discussion • Where do you see the team’s role heading: – How might this impact the skills required of the team – How might this impact the way the team will need to work with other parts of the organization – How will this impact resource requirements? What needs to be different: • Today • In the future • What are the current strengths of the team? • What are its greatest challenges? 23
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