Why a deal registration system matters at Hybrid Sales organizations
Let’s start this with a simple statement that “trust is earned, deal by deal.” Also, there are a few downsides to consider. Let’s skim over both sides here.
While trying to figure out whether you should have a deal-registration process at your company, you’re worried that:
1) You’re giving away margin dollars for no good reason
2) You’ve heard that Channel Partners feel that Deal Reg systems make their customer information available to your direct salesforce, and in turn, they’ll subsequently try to “steal the deal”
3) The longer their line card, the more Partner Portals they have to manage, and each one is different and you want people to use yours
An example of this last point; one of my partners at a previous employer mentioned to me that they have a line card of over 275 items from over 75 different vendors.
And these are all valid concerns by all parties. Stealing of deals has been going on since the dawn of time (OK, since the dawn of the centralized CRM system that also tracks deal registrations).
To add more intrigue, each deal registration system from each vendor has different rules and methods for payouts. This has forced some larger resellers to actually hire people to do nothing more than manage Partner Portals, Co-op/MDF programs and dollars, and to understand or research each vendor’s rules of engagement.
What does that mean to you?
Yikes. Now you’ve got to figure out where you fit into this puzzle with so many pieces.
If you are going to create a new Partner Portal, please, in the interest of the sanity of your channel partners, make it drop-dead easy to navigate and search. Make your deal reg system easy as well, and make it a part of your portal. Make the logins auto-fill some fields, if you can.
And make your rules and regulations easy to read, understand and follow.
In other words, use the “Golden Rule” in these efforts – treat your resellers in the method you’d like to be treated. In fact, I’ve begun thinking about the “Platinum Rule.” Treat people as they like to be treated. And this takes good Channel Managers to do so, effectively. Direct sales reps simply don’t have the time to do this type of work (nor do you want them doing this work).
It is incumbent on you the vendor to have clear Rules of Engagement – especially because your sales methodology is hybrid. If you don’t, then your resellers will be less likely to register deals with you.
Figure out your lowest margin proposition, and make sure you pay each party appropriately with the remaining margin – and make it clear to your direct reps that they are there to support the reseller, not steal the deal.
Commission overlays can be a good thing.
Of course, no one can make a customer purchase from any one specific reseller or other party – that’s illegal – but the vendor company is responsible for making it make sense to support its reseller partners. If it does not, there are tons of deals you will no longer see or know anything about. Your competitor with a “good enough” product and portal will win that battle – and possibly the war – for new customers. Not to mention the hearts and minds of your reseller community.
Think of it this way. If they sell more of your products and services, you are acquiring more and more new customers and new revenues. It has always amazed me to hear how some manufacturers feel strange that they are paying out so much in reseller commission… If you are paying out so much in margin, you are making more money, and growing share, right – and isn’t that the whole idea?
So what benefits do deal reg systems provide?
There are many benefits to deal reg systems beyond reseller protection and margin reduction:
1) They help measure partner engagement (e.g. partner interest in your product). Better-engaged partners sell more
2) They provide product marketing information (new use cases in existing markets) you can gather no other way
3) You learn of new market verticals your product serves
4) Associate deal reg with a promotion, and you can better gauge the success of your promotions
There are many other good reasons to implement a deal reg system, but I submit that the product marketing information you gain is worth the price of admission.