How do you build a behavior-based promotion that will deliver demonstrable results in the channel?
Excellent question! Channel incentives often focus solely on past performance or closed deals. This approach rarely influences future actions like demand creation, or lead-to-opportunity management behaviors, which replenish pipeline and improve win ratios. Moreover, the buyer’s journey has drastically changed in the last five years and your partner is still selling the old-fashioned way.
Behavior-based programs allow one to see how well a promotion supports the real goal of increased partner performance by rewarding the activities and behaviors that lead to a sale, rather than just the sale. Behaviors are also easier to track. It is their collective impact that improves channel performance. You can actually change partner behavior and the outcome of the cumulative sales motion, by using incentives to remove the "friction" in the sales process and streamline lead to revenue management.
So, how does one build a promotion that will have a positive impact on partner behavior?
You start with the end in mind, you map the partner's sales process from demand generation, through lead management, to opportunity management into a closed deal, and say, "Here's where I want to go."
Recognizing that one of the most critical issues impacting partner performance today is the misalignment of the partner's sales process to your buyer's journey, you compare your partner's sales cycle to your buyer's journey and align them by connecting the dots backwards from deal closing, to deal registered, and SAL.
Once you know where the closed sales starts and where it ends, look at the steps in between for incentive points. Remember to use incentives to remove the “friction” in the sales process and streamline lead to revenue management.
The resulting sales cycle map will include the specific activities and behaviors by partner type and tier which partners engage in for through-partner demand gen, lead follow up, deal registration, appointment settings, proof of concepts, and closed deals.
So, how do you correlate the points you are rewarding for closed deals to points for behaviors?
Let’s say you originally offered a three percent incentive on the closed deal, you could pay a small percentage of that for the deal registration, and the remainder could be paid out for the closed deal. If your original reward was $900, that could equate to $150 for registering an approved deal and then $750 for closing it. Those are good numbers.
Deal registration (not closing) is one pre-sale behavior that you should always incent. A deal registration promotion allows you to gain visibility of pipeline immediately and will increase, if not double, the pipeline substantially. SPIFF or points would fit nicely as incentives for a deal registration promotion.
Of course, there are other activities leading up to a closed deal that you should reward, but this is a simple example of one behavior that you want to incentivize before the close.
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