A few weeks ago I was at a software vendor’s conference where they were spruiking the benefits of being a partner. The whole pitch was around being a services-lead business: how your business acumen and technical know-how will give the end customer the confidence to let you guide them on their IT journey, during which you can deliver best-in-class products as part of a total solution. There was lots of talk about consultancy selling and managed services.
Then the vendor introduced their current promotion of an extra discount on products if the order was placed before the end of the year.
I’ve never been on a sailboat when it’s hit a reef, but I imagine the feeling is much the same as my reaction to those two messages. We were serenely sailing along on a sea of expertise and outcomes-based selling, then we suddenly jarred to a halt with a raw product-based promotion.
I have been a marketing manager in a US-based vendor. I sympathise with the pressure vendors are put under to meet year-end targets and quarterly reporting metrics. This pressure sometimes obscures our view of the critical components of channel marketing.
So whats the solution?
When designing promotions always align them with your value proposition to your channel partners. What is yours? Is it something as simple as, “Sell my product and make a margin”?
If so, then extra discounts on products will probably resonate with your channel.
However, product margin offers won’t resonate if your value proposition to your channel is something more complex or subtle like, “Including this product in your total solution will provide better business outcomes and allow you to maintain a services engagement with your customer.”
The successful vendors I work with align their promotions with their channel partners’ business models and make sure the message behind their promotions reinforces their value proposition to their channel.
Any other approach risks you being just be another undifferentiated product company, hoping that feature/function marketing will somehow cut through.