Rev Up Your MDF/Co-Op Program

www.channelmanagement.com [email protected]

7250 Redwood Blvd. Suite 214 Novato, CA 94945 Phone 415.427.5100

Featured Speakers

Chris Becwar Director, Marketing and Strategic Alliances

Steven Kellam Vice President, Sales and Marketing

www.channelmanagement.com [email protected] 415.427.5100

Agenda

I. Auditing Your Program

• Reviewing 2012 • Temperature check on 2013

IV. Wrap Up

• Common execution errors & quick tips

II. Optimizing Your Program

• “8 Key Variables” • Trends influencing MDF/Co-op

III. Putting It Together

• An example

About CCI: Why We Understand MDF/Co-op


CCI Provides Incentive Solutions to:

Manage

Measure Optimize

Motivate Your

Channel

Turn Incentive Programs into a Key Competitive Advantage


Comprehensive Solution Set Distributor Reseller Sales Reps Consumer

Co-op/MDF/BDF

Streamline management of joint marketing programs

Marketing Planner

Plan marketing programs, forecast and measure ROI

SPIF & Rebates

Run short- and long-term incentive programs

Sales Performance Rewards

Reward channel partners for attaining sales goals

Trade-In Rewards

Manage incentive programs requiring physical return of goods

Opportunity Management

Deal Registration, Lead Management, Referral Rewards and Special Pricing


Guidance At Every Step

Program Design

Program Development

Program Evolution

Complete Incentive Solutions

Configurable SaaS Application

ROI Metrics

Multi-currency/lingual

Fund allocation

New fund set up

Approval workflows

Partner and Activity – add, deletes, changes

Email alerts

Global Program Management

Available follow-the-sun

support

Partner Support

Program Administration

Claim administration

Payments

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CCI Clients

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How did your program perform last year/quarter?

Part 1: Auditing Your Program


2012 Program Audit 1. Program Performance • What were program results? Change from baseline? • What was program ROI? • Activity levels? Utilization levels? • Program operations and support…SLA, Claims, etc

2. Objectives /Elements / Metrics Capture • Were objective(s) clearly defined? • Were they the right objectives? • Were they carried through your guidelines? • Were metrics relating to objectives captured?

3. Program Communication • Were program goals agreed to/signed off by key

internal stakeholders? • Were they communicated to all stakeholders? • What was ongoing program communication?


Key Baseline Metrics Measurement Metric

Program ROI • Gross profit from program/cost of program • Total # of qualified leads generated/cost of program • Revenue or new clients per campaign or plan/cost of plan or campaign

Marketing Mix • Dollars spent by marketing activity • Dollars spent on “higher value” vs. “lower value” activities

Program Utilization • # of active partners/total # of partners • # of users accessing program/tool

Fund Utilization • Funds accrued • Funds expired • Funds outstanding (pending payment) • Funds unclaimed

Prior Approval Activity • Total PAs submitted • Total PAs accepted/denied • Total PAs on hold

Claim Activity • Total claims submitted • Total claims denied • Total claims on hold

Program Support • Total calls/emails to support desk • Response time to calls/emails • Time from claim approval to pay out


Qualitative Metrics – User Survey (Partners & Internal)

On a scale of 1-5, how helpful is MDF is driving demand?

Are you getting the level of reporting

you need?

How does MDF help you engage with partners?

What are the activities you find

most valuable?

How would you rate the program on ‘ease of use’?

On a scale of 1-5, how would you rate approval

process on claim?


Align with Company Objectives

Program Objectives

Corporate Strategy

Marketing Strategy

Channel Strategy

1. Review in context of corporate goals/strategy

2. How will your program contribute? How can the dollars available best be utilized?

3. Does it align with partner GTM? Customer buying process?

4. Adjust (if necessary) and write in SMART format

S p e c i f i c M e a s u r a b l e A t t a i n a b l e R e l e v a n t T i m e - b o u n d


Targeted Program Objectives

Too often: “Increase sales overall of specific products/solutions”

• Promote up-sell or cross-sell of new products to existing customers

• Recruit new channel partners with special “jump start” allowances

• Focus spending behind specific initiatives, media, or events

• Help introduce products/solutions to new target segments

• Focus on target industries or geographic markets

• Win channel mindshare vs. competition

• Improve channel “readiness” by enabling training, certification, and other

knowledge-building activities

With focus, spend can be more targeted and a key set of metrics can be focused on.


Example: Targeted Program Objectives

“The 2013 Joint Marketing Program will provide funding to partners for field marketing campaigns that will drive the launch of our Synergy Solutions product line with the goal of $1,000,000M in sales.”

“The 2013 Joint Marketing Program will provide funding to Gold and Silver Partners for field marketing campaigns that will drive the launch of our Synergy Solutions product line to the health care vertical with the goal of $800,000M in channel sales and 2% market share.”

“Increase Overall Product Sales”

Are my objectives translated to my program structure?

What are trends are impacting joint marketing programs?

Part 2: Optimizing Your Program: 8 Key Variables


Program Structure: Key Variables

1. Program eligibility • Which channel partners will be offered the program?

• Will they all be offered the same program?

Robinson-Patman Guidelines:

“Competing channel partners must be offered similar programs on a proportionately equal basis”


Channel Evolution and Mix

Direct Corporate

reseller

Distributor

VAR Retailer

ISVs

Consultants

System Integrators

Direct Marketers

MSPs

Hosting/ Infrastructure

OEM

Solution Providers


Program Eligibility Examples

B2B Mobile Solutions Provider

• Co-op program for distribution partners • MDF program for all other authorized channel partners

Design Software Company

• MDF program for certified partners only • Top tier (over x dollar) is given specific MDF budget annually based on

sales volume

Printing Equipment & Managed Services Company

• Low accrual Co-op program for ‘volume’ partners • Targeted MDF Program for ‘value’ partners that support higher-end

solutions



1. Program eligibility 2. Program period

• Annual or quarterly are most common

• Should align with sales cycle and product/solution seasonality

• Do you need a lesser or greater degree of control?


Product Seasonality vs. Program Period



1. Program eligibility 2. Program period 3. How funds are earned

• Discretionary or earned accruals? Combination?

• Past sales performance or anticipated future performance?

• Do the funds roll off or expire at once?


Baseline Definitions

Co-op Programs • Marketing allowances are accrued as a percentage of past sales • Guidelines are well defined, with comprehensive proof-of-performance

requirements • May require minimal pre-approval requirements fostering ease-of-use • Lend themselves to expense accounting

MDF Programs • Discretionary funds, not ‘owned’ by partners • The available funds are often not announced in advance, but are

negotiated to achieve specific goals • Often require less complete proof-of-performance documentation than

traditional Co-op programs, and pre-approval is required • Lend themselves to contra-revenue accounting


Pros & Cons

Advantages of Co-op • Better advanced planning as partners • Typically easier to get internal funding/buy-in • Can be perceived as a better incentive/benefit • Great for more mature markets

Advantages of MDF • Greater flexibility, no direct link to ‘sell thru’ by a partner • Flexibility in funding commitments YoY or QoQ • Great for more dynamic markets

Best of both worlds? Hybrid Model with both Co-op and MDF



1. Program eligibility 2. Program period 3. How funds are earned 4. Products/Solutions

promoted

• Will the accrual or reimbursement level vary with specific products?

• Will program target all products/solutions or a subset?


Multi-Vendor Solutions Becoming More Common



1. Program eligibility 2. Program period 3. How funds are earned 4. Products/Solutions

promoted 5. Eligible activities

• How will the allowed activities

support your go-to-market strategies?

• How will they support your partners’ go-to-market strategies?

• What behaviors will you want to ‘reward’?


The ‘Consumerized’ B2B Buyer

Today’s B2B Buyer • Lengthening ‘getting to know you’ period (marketing) • Shortening ‘making a decision’ period (sales) • Looking for ‘continuum’ vs. ‘episodic’ relationship

Impact on B2B Marketing Tactics • Marketer’s key role now is to help buyer get smarter • Content is King, but Context trumps King

MDF/Co-op Activities to Focus on • Activities are those that support delivery of ‘thought leadership’ • Key are the vehicles that best support delivery of ‘thought leadership’


B2B Marketing Trends

Most popular B2B marketing tactics in 2012 (by usage):

Most effective B2B marketing tactics in 2012:

Source: Marketing Profs, Content Marketing Institute

• In-Person Events (78%) • Webinars/Webcasts (70%) • Case Studies (70%) • Videos (61%) • eNewsletters (60%) • White Papers (60%)

• Blogs (58%) • Microsites (56%) • Articles (51%) • Social Media (50%)

• Article Posting (79%) • Social Media (74%) • Blogs (65%) • eNewsletters (63%) • Case Studies (58%)

• In-Person Events (56%) • Videos (52%) • White Papers (51%) • Webinars/Webcasts (46%)


B2B Marketing Trends

• Social media continues to grow in importance:

• 61% more marketers perceive social media as being effective in 2012 than last year

• 86% of decision makers use social media for business purposes.

• The largest challenge of B2B marketers is “producing the kind of content that engages prospects and customers.”

• 60% of respondents indicate they plan to increase their content marketing budgets over the next 12 months

Source: Forrester, Marketing Profs, Content Marketing Institute



1. Program eligibility 2. Program period 3. How funds are earned 4. Products/Solutions promoted 5. Eligible activities 6. Reimbursement %

• To what extent do you want

to reward certain behaviors? • Or discourage others?


Tactical vs. Strategic Metrics

• Direct Mail • Email • Advertising

• Responders • Leads

• Customer Event • Telemarketing

• Attendees • Appointments

• Demo/ Eval. Unit

• Units Placed • Proposals • Opportunities created

• SPIF/ Sales Incentive

• Units sold • Sales value • Opportunities closed

Activities: Metrics:

Awareness Interest Desire (Trans-) Action

Tactical Metrics (Contribute to Business Drivers)

Strategic Metrics (Business Drivers)

EXAMPLES: EXAMPLES:

• Number of responders • Number of leads • Event attendees • Number of proposals • Number of demos given/units place

• Number of new clients • Sales Value • Sales Units • Reference Accounts


Standardize Your Tactical Metrics

METRICS BY ACTIVITY TYPE

Impressions

Responders

Qualified

Leads

Attendees

Sales Presentation # of U

nits Placed

Proposals/ O

pportunitie

Advertising: Print/ Broadcast

Advertising Online

Direct Mail

Demo Equipment

Marketing Collateral

Newsletters

Seminar Events

Telemarketing

Tradeshows

Training

Webcasts

Quick Win: Standardizing data format (and compliance) key to insights on ROI at activity, business and program levels.



1. Program eligibility 2. Program period 3. How funds are earned 4. Products/Solutions promoted 5. Eligible activities 6. Reimbursement % 7. POP/Creative

Requirements

• Brand adherence requirements for funding?

• Will you provide execution tools? Or, provide special incentives for use of your tools?


Marketing Portals



1. Program eligibility 2. Program period 3. How funds are earned 4. Products promoted 5. Eligible activities 6. Reimbursement % 7. Creative requirements 8. Reimbursement

method

• How will you reimburse efforts? Cash? Credit? 3rd party payment redirect?

• Should the method be consistent across all partner segments?

Part 3: Let’s Put It All Together

An Example


Example of Objectives to Variables

ACME-TECH INC. • Corporate Strategy (Sales/Mkt/Channel)

Focused on cross-sale, up-sale in existing accounts

Direct sales and small value add, solution-oriented channel

• Channel GTM Complementary products, selling network

implementation, service contracts

• Customer Buying Focus Expertise, reliability, up-time & fast service

for issues of key importance

• Environment Regulations differ greatly region to region Brand vs. competition recognition differs

greatly


Example of Objectives to Variables

PROGRAM IMPACT • Program available to established,

certified and trained partners • Funds run annual • Funds are accrued based on past

sales volume, additional discretionary fund for service only partners

• Only enterprise products eligible • higher reimbursement %’s on funded

headcount, and education oriented activities (for partner)

• Brand & competitor displacement activities have higher reimbursement in some markets

ACME-TECH INC. • Corporate Strategy (Sales/Mkt/Channel)

Focused on cross-sale, up-sale in existing accounts

Direct sales and small value add, solution-oriented channel

• Channel GTM Complementary products, selling network

implementation, service contracts

• Customer Buying Focus Expertise, reliability, up-time & fast service

for issues of key importance

• Environment Regulations differ greatly region to region Brand vs. competition recognition differs

greatly


Example of Metrics Alignment

ACME-TECH INC.

• Program Goal Increase product up-sales in existing

accounts

• Business Outcome Develop opportunities by promoting

benefits of new products to accounts with old legacy product

• Tactical Activities Email and Direct mail campaigns Educational Webinars Regional 1-day seminars


Example of Metrics Alignment

METRICS HIERARCHY Program Metrics

• % increase in accounts moved from legacy to new product

• Pipeline conversion % • Gross Margin of opp. won

Business Metrics • # of new opportunities created • # of proposal delivered to

existing accounts for new proposal

Tactical Metrics • # of impressions • # of attendees • # of leads • # of demos

VERITECH INC.

• Program Goal Increase product up-sales in existing

accounts

• Business Outcome Develop opportunities by promoting

benefits of new products to accounts with old legacy product

• Tactical Activities Email and Direct mail campaigns Educational Webinars Regional 1-day seminars

Common Execution Errors and Quick Tips

Part 4: Wrap Up for 2013


Execute for Success

Common Execution Errors Remedy

Low utilization rates • Survey partners to better understand your program alignment with their go-to-market strategy

Poor program understanding • Assure adequate training is in place to ensure uniform understanding of program benefits and administration

Poor alignment with partner needs • Consider joint planning with larger partners through high-touch Channel Account Managers

Program perceived as too vague or complex • Clear, concise guidelines for program participation • Simplified administration through automated processes

No clear benefit to the program, no clear ROI • Objectives not properly identified • Metrics not universally implemented or available

Payments take too long • Cash flow is the largest concern for most businesses today. Most programs are pre-funded by channel partners, reimbursement should be prompt – less than 30 days from claim approval

Poor or delayed follow-through on special requests • Program administration should follow-up within 48 hours for all special requests


Wrap Up for 2013

1. Audit your current program • Identify results, opportunities, changes needed • Establish your 2013 objectives • Align your objectives to corporate strategy, partner GTM, customer buying • Be specific and measurable – use the SMART format

Quick Win:

• Review program objectives in relation to corporate objectives annually

• Update SMART format


Wrap Up for 2013

1. Audit your Current Program

2. Optimize your program Drive your objectives through the 8 variables: • Program Eligibility • Program Period • How funds are earned • Products Promoted • Eligible Activities • Reimbursement % • Creative Requirements • Reimbursement Method

Quick Win:

• Reduce reimbursement % (or eliminate) on low-value activities

• Look to leverage marketing automation platforms & nurture marketing tools


Wrap Up for 2013

1. Audit your current program

2. Optimize your program

3. Evaluate the impact of key trends • Evolving channel ecosystems • ‘Consumerized’ B2B buyer • Changes in B2B marketing

Quick Win:

• Make funding available to ‘non traditional’ partners that do not resell for you

• Add thought leadership-oriented activities to your eligible list


Wrap Up for 2013

1. Audit your current program

2. Optimize your program

3. Evaluate impact of key trends

4. Gather multi-level metrics • Tactical goals = results of individual marketing activity • Business goals = business or campaign outcomes • Program goals = overall attainment of program objectives

Quick Win:

Determine now what data points you need to gather to do a better audit prior to 2014

Thank you!

Chris Becwar Director, Marketing and Strategic Alliances

CCI: Channel Management Solutions

[email protected] channelmanagement.com

Rev Up Your MDF/Co-Op Program

Business

Transcript of Rev Up Your MDF/Co-Op Program