This isn’t Cloud 9: Moving to the New Channel Business Model

August 12, 2015 Claudio Ayub

sad cloudChannel ecosystems are in a state of flux due to disruptive technology delivery methods, and evolving business models have put pressure on the traditional channel as they transition to the Cloud, further complicating efforts to simplify and become “easier to do business with.”

Historically, the channel ecosystem was characterized by traditional relationships—i.e. partnerships with long-standing vendors, suppliers, and customers. With these partnerships came well-established operating protocols that fostered consistency and predictability. When innovation is linearly paced, these ecosystems are effective. However, as the pace of change from disruptive technologies increases exponentially, traditional notions of a channel ecosystem may need to be redefined and, in many cases, flipped on their head.

The mind-set for a new channel ecosystem should be agile and adaptable instead of pre-wired and static. For vendors that are accustomed to linear change but are planning for exponential change, the requirements gap may prove to be significant. Gartner is predicting that over the next five years, a large majority of reseller partners will have made an effort to evolve their business into the hybrid model. But beyond basic resale, only about one third will make the transition successfully. It is clear that the transition to a Cloud-based or hybrid model, coupled with a sound cloud based go-to-market strategy will continue to pose many challenges to vendors and partners alike.

The new reality is that channel professionals can no longer categorize channel partners according to discrete business model types. The hybrid channel partner is the new norm, but supporting the go-to-market needs of resale, hybrid, and born-in-the-cloud partners will presents several challenges, for which I’ve included some solutions:

1. Enablement

Partner who are busy going through transformation don’t have the time or resources to effectively market your products or services, much less pay for training costs as the move to the cloud has severely impacted their profitability. Enabling partners with the knowledge, tools, and resources to market you products will go a long way in making partners successful and definitively more loyal to your brand. In the channel is all about reducing effort to increase loyalty.

2. Engagement

Different partner types with different business models require different incentive program promotions, aligned to the partner business model and specific earning and redemption opportunities at the company and individual level. A single multi promotional incentive engine solves this problem, by being able to run recurring and concurrent promotions segmented by partner type, business model and go-to-market strategy.

3. Measurement

Measuring resale, hybrid, and cloud partners performance requires a single incentive management and measurement engine to effectively track, report and analyze their performance on a level playing field. Empowering multiple partner types to track weekly, monthly, and quarterly standings against goal will ensure engagement, alignment, and overall success of your incentive program.

For more information about the changing business model and steps you can take to create a more efficient channel incentive program, download our resource: It’s Time to Flip the Channel. 

So what are you doing to help your channel partners go through the transition to the cloud, and keep them engaged throughout the process?

 

About the Author

Claudio Ayub

Chief Strategy Officer Claudio Ayub brings over 20 years of global channel marketing experience to Perks.He has executed major go-to-market programs for a variety of vendors, including Bing, Cisco, Dell, EMC, IBM, Kaspersky, Lenovo, Microsoft, Motorola, Seagate, Symantec, and VMware among others.

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