As originally posted on Salesforce

Channel partnerships are a high impact strategy for growing your company and a good partnership can provide access to new customers and references that bring in business. Follow these action steps to define, refine and secure a channel partnership.

Step 1: Determine a channel partnership strategy

A channel partner distributes goods and services. There are three major types of channel partnership options to distribute your product.

1. You sell through your partner.

Product companies sell their product through a third party storefront. Retailers are partners to products they think will sell with their customers.

This is the case with AppExchange on Salesforce, the AppStore for Apple or any marketplace. Another classic example is GILT Groupe, who partners with brands like Calvin Klein and Quicksilver, providing distribution by promoting products at discounts. This is a powerful strategy, acting as a source of potential customers as your partner grows.

2. Your partner sells with you.

Here, partners sell your products as an upsell or missing value proposition. Any company that offers your service as a way to expand their offering fits into this category.

For example, a car reseller might work with a bank to upsell a car loan, or a software vendor might complement its offering with another partner.

When Microsoft embeds an antivirus demo in its operating system, or when online services like Box bring in security providers to complement their enterprise offer, they are also employing this strategy.

3. Your partner sells for you.

Any partner acting as the promoter or seller of your product falls into this category. This partner is 1) a sales and marketing partner using marketing and sales resources to promote your product to new markets, or 2) a value added reseller, using your service as part of their own service offering. This provides additional value in the operation of that service, instead of simply selling it.

This is the case in any distribution partnership, from your local supermarket, to more traditional distributors. This is also the case in an OEM partnership, like Dell selling computers with Intel processors inside.

This scenario is the most complex because you have to make sure that your partner has an incentive to sell your product.

Step 2: Identify relevant partners and grade them

There are a number of factors to consider to ensure a partnership is relevant and profitable:

  • What market reach do you need? A local partner might be faster to “close” than a national partner, and could be helpful if you are targeting a niche market.
  • Do they complement your product? Determine how each partner might help you reach your goals.

How well does your solution fit the need of the customer? How likely are your partner’s customers to purchase?

Once you have a good sense for each partners potential, score them:

  • “A” partners have the above traits in spades. A deal with these partners is likely to be very impactful.
  • “B” partners have these traits to a lesser degree. These partners might drive less revenue but may be faster.

Step 3: Develop a coherent plan for reaching these companies

Now that you have established criteria for partners, reach out to these companies and establish a connection. Here’s how: Start with companies that will take a chance with you.

B partners are more accessible than A partners. These partners may have a small, regional customer base but could be fast to work with, and willing to take on new products.

If your partner is selling your product, develop a relationship with their sales team. By doing this, they are more likely to suggest your product.

Develop a compelling value proposition and pitch it to that company. Position your company as a value add to the partner. Does your product help a company drive profits? Your offering should add revenue to your partner’s product line.

Step 4: Drive growth through your partners

Channel partners boost sales, decrease time to market, and provide access to competitive markets. So get started on building channel partnerships today.

Read the full article at or download our white paper: Making Partner Managers Winners: What They Need to Succeed.

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