B2B Partner Programs

B2B partner programs can be critical to improving sales, enhancing the brand, and growing a customer base. One type of partner program is channel marketing, in which a company uses partners to distribute its products in different markets. For example, a software company may form a channel marketing partnership with a computer maker, or a jewelry company may sell on TV and on social media, in addition to in stores. Another example is forming partnerships that bundle products that offer a complete solution and selling them together; for example, Web site development, SEO optimization solutions, social media marketing, and content management solutions.

More than 73 percent of consumers shop on multiple channels; companies gain new customers and retain current ones when they develop strong multichannel or omnichannel programs. In fact, 89 percent of companies who have developed strong omnichannel customer engagement programs retain their customers, while only 33 percent of companies with weak strategies do so. Multichannel partner programs often are essential for small companies, but they are so successful that large companies such as Shopify, Oracle, Intel, and Microsoft use them as well.

The best partner programs offer value for both partners. Partners should continually be alert to be sure the value to each is equal; partnerships in which one party feels shortchanged will not endure. The partnership itself also should create more value than each company could working on its own. In other words, 1 plus 1 must equal 3. This can be accomplished by both sides allowing each partner to do what they do best in the partnership. The partnership should also be managed as if it is one unit, setting up committees to make decisions together. In good partnerships, the parties remain flexible; when market conditions change, both parties may need to change in tandem.

Channel Partner Program

Before beginning to build a channel partner program, a company should review its business goals and vision to ensure the program is designed within that vision. It also should have the support of all its executives. Once these items are in order, a company is ready to begin. Here is how to build a channel partner program:

• Clearly define why customers would want to buy your product. Compare the value your product offers with that of competitors.
• Understand the process customers go through in determining whether to buy your product and design a sales process that takes their buying process into account. Determine what your company should do at each stage of the process to meet the customer’s needs.
• Research competitors’ partner programs. Try to determine their target audiences and how their partner programs fit into that. Examine how they’ve designed their programs, how they are building relationships with their channel partners, and what is working well (and less well).
• Define the types of partners you will work with to bring the most benefit to your customers. Channel partner types might include resellers, system integrators, consultants, Managed Service Providers (MSP), Original Equipment Manufacturers (OEMs), software vendors, distributors, and marketing agencies.
• Determine what critical success factors channel partners will need and how you will provide them. For example, they may need support, project management, or a specific pricing structure.
• Determine what will motivate your partners, for example, revenue, happy customers, and leads.
• Define your program based upon the success factors and motivating factors.
• Negotiate with partners to determine who will be responsible for what.
• Define a framework.
• Build capabilities.
• Determine how you will measure success.
• Develop a marketing strategy.
• Determine how you will choose partners.
• Launch your program
• Be willing to make changes as necessary to be sure the program works as well as possible for both partners.

The best channel partner programs will keep the customer front and center while also nurturing the partner relationship. In the SaaS industry, the best programs typically include co-marketing support, a partner portal, a payment for referrals, and sales training. Some also offer sales support and public listing of partners.

Channel Partners Examples

A company should research examples of successful channel partnerships when developing its own channel partner template. One example is Pipedrive’s program. Pipedrive is a CRM system that connects with other software tools. Its channel partner business plan includes two separate components — affiliate or referral partners and reseller partners. Anyone can join the affiliate program for free and receive a referral commission of 33 percent for the first year. Those who want to become resellers undergo training and must meet sales retention goals; however, they also receive a listing in a public directory on Pipedrive’s site, a 20 percent referral commission for life, and a free demo account.

Another example is Databox, a business analytics platform. The company provided the product to marketing agencies for free to introduce them to it, then promised to reduce prices drastically for the first 10 agency clients that were referred.

Another example is GILT Groupe, an online shopping site. GILT Group partners with international brands such as Calvin Klein and Quicksilver, providing distribution by promoting products at discounts. Or, another example is Microsoft that embeds a trial for antivirus software in its operating system. App stores such as GooglePlay or AppExchange also are channel partners for the apps they carry.

Another example is delivery services, such as DoorDash, partnering with retailers such as 7-Eleven to deliver items customers ordered online.

Brokers are an example of intermediaries who use channel partners. For example, a business might hire an export company that manages transportation and customs clearance for various clients. The export company would have agreements in place with several partner carriers.

Reseller Programs

A robust reseller partner program doesn’t develop overnight but takes months, and sometimes, years of planning and nurturing. Once you’ve found the best resellers, you’ll need to develop two types of content. One type is to address the benefits for resellers. For example, the content for resellers will describe the reseller program template, including all the ways in which a reseller can profit from the arrangement. Developing a brochure that includes success stories from other reseller partners is one way to start building content.

The second type of content is designed for the resellers to give to the end-user customer. It addresses the product benefits from the perspective of the resellers’ potential customers.

In establishing a software reseller program, companies will also often need to install the software and integrate it with the reseller’s software or software of other partners the reseller has. Software developers will need to train the reseller on the software, and the reseller and manufacturer will need to determine who will provide customer support at each tier. When building a reseller program, many SaaS companies start off slowly to build a firm foundation, then scale larger.

Partner Program Framework

Some companies who have built partner programs find using partner program templates and software to be helpful. While not all types of agreements or partners will require the same documentation, having a template can save time. A typical template would include:

• basic contact information for the partner
• expectations and other aspects of the agreement
• compensation and fees, if any
• agreements around intellectual property and confidentiality
• signatures
• Partner program software can help track progress toward goals, provide a common interface for co-marketing campaigns, and help companies manage their relationships with partners.

Best SaaS Partner Programs

The SaaS industry fits well into the concept of channel partner marketing. Successful channel partner programs in this industry offer a mix of services for each partner and effectively use both partners’ strengths, in addition to offering co-marketing support, listing partners publicly, and providing compensation for sales or leads. Here are examples of the best SaaS partner programs.

Shopify

Shopify provides various perks for freelancers or agency partners. These include discounts on products and services from other companies. They also provide full training through their Shopify Partners Academy and provide access to a dedicated portal. The portal allows the partners to submit referrals and leads, view commissions, and access resources. The company also pays generous commissions over the life of the referral’s membership and large one-time fees to app developers who sell their products.

Slack

Slack is a proprietary business communication platform. It works with more than 1,000 integration partners. Partners must apply for the program and be accepted. Benefits include being listed in the public directory and gaining access to more than 9 million active users. Partners also receive complete documentation on their platform.

Xero

Xero provides small-business accounting software that integrates with several other software applications, such as time-tracking and e-commerce programs. It offers a point-based partner program. Partners earn points for referrals, being added onto a client’s account as an adviser, or using Xero in their own business. The more points the partner earns, the greater the perks it receives. Perks include discounts on subscriptions that can be passed onto clients, assistance with client migrations, listing in the public directory, and marketing funding.

Bluehost

Bluehost is a Web-hosting company that offers a referral partner program. It pays a $65 referral commission for every new customer.

Auth0

Auth0 provides an authentication platform for Web and mobile applications. Its technology partners use the platform in their own B2B SaaS tools. They also can refer and help their own customers integrate the platform into their existing apps. Auth0 also has referral/affiliate and resale partners to whom it provides commissions. The company also provides strong pre and postsale support.

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