Submitted
By David Brinkman
Partner programs are popular business strategies that vendors use to grow their sales footprint and diversify their network of users. Not only can they bring in revenue, but they can also be important links between vendors and customers.Similar to a company’s advisors or collaborators, partners can be crucial to the overall success of a business. Their impact on sales, market share, innovation, and even brand recognition can be enormous.
Three common types of partner programs are prevalent in the IT sphere. The first is integration partners that integrate a company’s product or solution into existing software and vice versa; the second is a reseller—also known as channel—partners that purchase vendor software and offer it as an add-on to their customers and users, and the third are referral partners that, essentially, act as consultants and sell your product alongside a suite of other solutions to their clients.
No matter the type, a solid partner program is essential to business growth, especially for IT and Software as a Service companies. Global brands such as IBM, Apple, and Cisco, as well as small and mid-sized companies,continuously reap the benefits of a partner program.
In order to fully leverage the value of a partner program, it is important that vendors and companies understand the range of opportunities that this business model can offer. Four key benefits of a partner program include increased revenue, indirect sales channels, enhanced product portfolio, and an extended network.
Increased Revenue
Without question, partner programs create significant growth in sales and distribution of a product or service. The best part about partnership programs is that both sides benefit from the increased revenue. For the vendor, whether it’s an upsell opportunity, ongoing membership with a company, or a new sell via a consultant, each partnership not only generates revenue for your company, but it also grows your sales footprint.
At the same time, your partners can also grow revenue for their businesses. By integrating your solution into their product or adding your solution as an add-on for their packages, these companies are gaining new business because your product is adding a competitive advantage.
Indirect Sales Channel
The direct sales generated by a partnership program area key benefit, but there’s another type of sales channel created from this business structure. For integration and referral partners, a vendor’s solution creates added value to its core offering and, essentially,can help attract new types and greater amounts of customers and users.For example, a company looking to purchase customer relationship management (CRM)software may have originally only considered purchasing the management software itself. Yet, once presented with additional products, such as lead tracking tools, document management solutions, electronic signature, or an employee communication tool,the company may easily re-consider needs and, thus, could potentially purchase your product in addition to the CRM software. As a result, vendors receive access to a new type of customer and, potentially, access to a competitive market.
IBM’s PartnerWorld program reported that it maintains 150,000 partners, which has created an indirect sales channel of around 60,000 partners selling IBM products and services to their customers. In fact, the company says around 20 percent of its revenue is generated via partners.
Enhanced Product Portfolio
Creating a well-rounded portfolio of solutions is an ongoing task that research and development teams face. For integration partners and resellers in particular, a key reason why a company is looking to partner with a vendor is because they want to improve their products and offerings and, essentially, better meet the needs of their customers.
Earlier this year, Netflix announced key partnerships with Philips, Panasonic, and other similar companies. This partnership allows companies to offer their customers the ability to instantly stream Netflix movies for a low price. While both sides benefit from the increased revenue, each Netflix partner has significantly improved its overall product, gaining a competitive advantage and greater awareness in crowded and emerging markets.
To add to this, what many businesses may not realize up front is the unique opportunity partners provide for businesses to collaborate and offer new ideas and solutions to better meet their target markets. The pace of technology is always changing and partner programs allow for the kind of business collaboration to help brands and vendors find new and better ways to keep up with these changes.
Extended Network
Whether it be an integration partner, reseller, or referral, each unique partnership forges an important relationship on its own, one that offers greater access to resources, expertise, and distinctive skill sets. When a vendor partners with a company, they’re essentially partnering with that company’s users and partners, which broadens their network.
For small- to mid-sized companies looking to grow visibility and improve brand recognition, creating a broader network is critical. With unlimited access to different types of expertise and markets, companies can decrease their time to market, and also find access to key resources needed to boost sales.
The partnership opportunities provided by Microsoft Dynamics CRM is an excellent example of how a solution provider can grow their network of users. Becoming a Microsoft Dynamics CRM partner means your solutions are instantly made available to the thousands of Dynamics users. In return, partners have the opportunity to collaborate with other partners on crafting flexible, cross-platform solutions for CRM users. In addition, partners will benefit from firsthand knowledge of Microsoft product features and capabilities.
A world of opportunity
Without question, partner programs offer a wide variety of opportunities for product and services providers. From increased revenue to product enhancements and an extended network, it’s crucial that companies understand the different levels of value partners bring to their business so they can fully leverage all the benefits that a partner program brings. SW
David Brinkman is president/CEO of AssureSign, an electronic signature software provider for enterprises and small business. As a veteran technology entrepreneur, Brinkman co-founded Third Party Verification, Inc., which is now a part of AssureSign. To keep up with the eSignature conversation, follow @DavidWBrinkman or @AssureSign.
May2016, Software Magazine
