Why Channels Matter - to Alliance Managers
Posted: 3/23/2017 by Norma Watenpaugh
ASAP Netcast Webinar | December 7, 2017
I was honored to moderate a panel of experts in discussing the growing interdepences of channels and alliances in the industry. Here is the feature write up from the ASAP newsletter, Quick Takes.
Moderator: Norma Watenpaugh, CSAP, Founding Principal, Phoenix Consulting Group
Erna Arnesen, CSAP, Global Channel and Alliances Officer, ZL Technologies
Steven McGarr, Global Strategic Partners Organization, Cisco
Kristina Scott, Head of WW Partner Communications, Marketing and Platforms, Brocade
High-tech industry veteran Norma Watenpaugh says there was a time when technology sales channels and alliances operated in two separate, but parallel universes. But today, after years of consolidation in most high-tech companies' sales channels, lines between alliances and channels are blurred as more interaction in the partner ecosystem has forged new thinking about how partners go to market. "Complexity in the market has made it clear that one vendor cannot meet all the needs of today's customers," Watenpaugh explained in teeing up her expert panel for a December 7, 2016 ASAP Netcast Webinar on this topic. "In fact assembling an ecosystem of partners including vendors and channels partners is a key challenge. How are companies addressing that challenge?"
Phoenix Consulting Group's recent survey of high tech firms revealed "a definite trend—alliances are going to market through channels," Watenpaugh said. "All sorts of channel options are being utilized—over-performers are using channels and multiple routes to market along with direct sales models."
Panelist Kristina Scott noted that "at Brocade, over the past 12 to 18 months, we are increasingly recruiting and growing alliances because of channel opportunity. Buyers increasingly are looking for solutions. We need to have the right alliance partners—and channel opportunity becomes the rationale. We are increasingly cultivating specific distribution and reseller relationships because of the overlap with the alliance partners."
A Brocade slide showed an example of what kinds of partnering activities happen when alliances and sales "meet in the channel":
- Shared value proposition and go-to-market (GTM) messaging
- Joint partner training
- Joint account-based selling
- Joint roadshows and demand generation activities
- VAR (value added reseller) incentives for selling joint solutions
- Co-branded sales assets on respective partner portals
This works even when—as is typical for a large high-tech player—partners in the channel risk competing. "We build walls and very specific co-branded assets with competing partners," Scott noted.
Steven McGarr said, "Cisco went through similar exercise and identified value exchange with our channel. That's how the global partner organization came to be," he explained, noting that it is comprised of "those partners that reside in this intersection with our channel and the broader channel." As a clear example of an alliance management approach, Cisco considered not just its own goals but also those of partners. "We started to think about how do these partners make money. How do we drive not just our profitability but theirs. That profitability value exchange is very important."