A Successful channel incentive program requires a thought-out approach to achieve positive results. They don’t need to be overly complex nor target thousands of individuals to have the desired impact on your company’s bottom line. Effective channel partner incentives can also drive positive loyalty experiences and boost your company’s products and perception within the marketplace.
When getting started, whether you’re kicking off a new channel sales incentive program or seeking to improve upon an existing one, start by answering the following questions:
- What is the expected result to gain from my channel incentive program?
- Who is my target audience?
- What are the included products or services in my channel sales incentives?
- Are the rules concise and sales goals achievable?
- What will be the duration/time frames?
- How will I market the program to make it stand out in a competitive environment?
Let’s dive into each of these questions a little deeper. Answering each of these questions about your channel incentive program will ensure you are destined for success!
Determine Objectives for Your Channel Sales Incentive Program
The first step in the process, and arguably the most important, is to determine your partner incentive program objective(s). You will need to decide if your focus is on increasing sales, capturing market share, raising brand awareness, adding to the bottom line/ROI or any combination of these. Often objectives are not fully defined, which then makes measuring the effectiveness difficult. Take the time up-front to ensure the program sponsors are all on board with the objectives set at the beginning.
Define Your Target Audience
The second step, identifying your target audience, is also essential. Knowing who is selling your product and interfacing with your customers is key to driving positive sales results. In the channel space, often these individuals are unknown to you but can be identified as part of a profitable sales incentive program. Requiring your channel partners to enroll in the program provides the opportunity to capture and better identify the individuals that will participate. In addition to standard channel partner incentive programs that reward sales associates, you should also consider sales managers, distributors, and other individuals within the channel hierarchy for inclusion. These other individuals could be playing a vital role in the ultimate sale of your product, enforcing brand recognition, and building product loyalty with your end customer.
Identify Products and Services for Your Channel Sales Incentive(s)
The next step is to identify the products and services included in the program. When determining the incorporated products and services, you will need to keep in mind the overall objectives that you have set. Pay careful attention when selecting products and services. A “product that sells itself,” for example, shouldn’t be part of a program unless an objective is to grow market share for that product. Otherwise, you may be needlessly spending your sales incentive dollars to drive sales that would have occurred regardless of having a sales incentive in place. You will also want to consider your inventory levels. A channel sales incentive on products that aren’t readily available may discourage rather than encourage the desired sales behavior.
Create Program Rules
The fourth step, developing program rules for your channel incentive program, is often a stumbling block even for knowledgeable individuals with sales incentive experience. Focus on clear, concise rules that spell out the desired behavior and the associated reward for achieving that behavior. There are numerous types of incentives and approaches—too many to name here—place careful attention on the development of rules that drive your expected sales behavior. A tiered incentive, for example, can drive additional sales as individuals strive to hit the next tier threshold to increase their incentive reward. As well, an incentive that includes complementary products can create cross-selling opportunities when presenting options to the end customer. Another consideration is to tie incentives to learning/training programs associated with your products. Based on One10’s industry insights, a channel partner incentive participant who has demonstrated knowledge of your product often sells three times more than an individual who hasn’t taken formal training/certification as part of the overall program.
Determine Duration of Your Channel Promotions
The fifth step is to determine the time frame and duration for your sales incentive(s). Often companies run quick-hit promotions lasting a few weeks to a couple of months. This approach can be fine to move the sales needle on specific products, but consideration should be given to product sales cycles too. For example, large technology solution sales can take many months, or even a year, to sell. Therefore, a three-week promotion wouldn’t be effective in driving results in this type of environment. However, if an objective is to build brand loyalty, then a longer-term program needs to be considered with smaller sub-promotions under the larger channel incentive program umbrella (think loyalty points programs as one example). Also, be aware of the seasonality associated with your products. It may make sense to run a sales incentive on snow blowers in early fall, for example, to capture an early purchase behavior. That same promotion at the start of spring, however, would not be advised.
Use Effective Communication Strategies
The sixth and final step, marketing, is often overlooked but can make or break the successful outcome of your sales incentive. If individuals aren’t aware of the channel partner incentive, then even a very well-planned incentive can fall flat. Leveraging a communication strategy that involves print, email, and other social media approaches will assist in getting your program announced. Also, take advantage of using your field sales management to reinforce the program messaging within your channel. If you rely on distributors to move your products, then engage them to assist in promotion. Marketing posters and other print materials located at distributors and within your channel partners’ offices will help reinforce the program.
Answering all the questions above and launching your partner incentive program may seem daunting. Fortunately, One10 has years of experience in assisting clients in the setup and execution of successful channel sales incentive solutions. We work with you to answer the essential program questions, make recommendations on strategy, assist in identifying the strength of your channel space, and deploying your program on our proprietary sales incentive platform, PerformX®. We don’t stop there. A critical aspect of One10’s involvement is measurement. We leverage our experienced team of analytics experts to identify promotion effectiveness and suggest changes throughout the program’s life cycle to maximize your results. Drop us a line today to find out how One10 can partner with you to maximize your ROI for your channel sales incentive program on the PerformX platform.