By Dan Saks, President and Co-CEO, AppDirect
Forrester predicts the global public cloud market will reach $178 billion this year — up from its 2017 total of $146 billion. While the channel holds promising benefits for nearly all SaaS vendors, implementing a go-to-market channel strategy requires the right processes. Successful partner programs take time, planning, and smart investment of company resources.
Here are four things SaaS vendors need to know before launching a partner strategy:
1. Customer-ready products: Many SaaS companies today frequently release new versions of their software, providing benefits to both the customer and vendor alike. The customer regularly receives new features and functionality, while developers continually produce better, more innovative solutions.
However, beta software often yields headaches for channel partners. Missing features, poor design, or a confusing user experience causes support issues, and thus threatens customer retention. This scenario places the partner’s and SaaS vendor’s reputations at risk, potentially leading to decreased revenue.
Nonetheless, perfection shouldn’t restrain vendors from engaging in partner programs. Strong processes for recruiting, enabling, and incentivizing partners will have a bigger impact on success than a “perfect” product.
2. Repeatable and scalable sales processes: Nearly all successful partner programs have documented, repeatable and scalable sales processes in place. Establishing these processes for third-party resellers requires several key steps, including:
- Define the customer purchase process: How do customers currently buy your solutions? How do they discover your products, and what steps do they take when purchasing them?
- Define the sales process: Do you have defined sales stages that take into account the customer purchase process?
- Define actions needed for advancing or winning the deal: Do your resellers’ sales teams have tools at their disposal that help advance deals through the sales pipeline, such as demos, in-person presentations, executive meetings, follow up calls and emails?
3. Resources for onboarding and training: One of the biggest deciding factors in the success or failure of a partner program lies in channel partners truly understanding the solutions and the benefits they provide. For Booker, an all-in-one local service commerce platform, the “onboardability” of its software proved crucial in the company’s decision around launching a partner program.
As Dan Chandre, the company’s SVP of Strategic Partnerships, once explained at an industry event: “Having a reseller model is attractive because it’s a great opportunity to lower your acquisition costs. But the first thing we had to do was look at our software and ask, ‘is it resellable?’ It sounds so simple… but you have to look at how easy is it for a third party to make your software acquirable, to make it onboardable.”
Sixty percent of SaaS vendors that work with partners have a team — usually the sales or a channel team — that takes responsibility for partner onboarding and training. Fifteen percent require partners to pass a certification test before they can start reselling a solution.
Still, 10 percent of SaaS companies only give their partners materials to train themselves, while another 10 percent don’t provide any training at all. Enhancing the onboarding process leads to more effective partner programs. For example, Microsoft invested millions in partner training, market development funds, support, and enablement, a fact that has helped make the company one of the most successful cloud channel businesses, ever.
Although few companies can invest as much as Microsoft, creating documentation or marketing materials—such as user guides, data sheets, case studies, demo videos—and planning for training sessions, either in-person or web-based, will significantly improve the onboardability of vendors’ products.
4. A clear business case for the channel: SaaS companies launch partner programs for a variety of reasons, including developing value-added services for its core product, expanding its global sales footprint, tapping into new verticals, reaching the existing customer bases that partners have, driving additional revenue, or some combination.
Whatever the reasons, obtaining internal buy-in and alignment on the business case remains critical, as each business case requires a different focus from your sales or channel team. SaaS vendors that succeed at working with partners for add-on services involve partners in roadmap discussions. Vendors looking to expand sales footprint and drive revenue benefit from co-marketing engagement.
Having a clear idea of the purpose of your partner program increases overall effectiveness — for both your company and your partners.
About Dan Saks, President & Co-CEO
Dan is president and co-CEO of AppDirect, the only end-to-end cloud commerce platform for succeeding in the digital economy, which he co-founded in 2009 with Nicolas Desmarais. Under Dan’s leadership, the AppDirect ecosystem powers millions of cloud subscriptions worldwide and connects channels, developers, and customers to simplify the digital supply chain by enabling the onboarding and sale of products with third-party services, for any channel, on any device, with support. In addition, Dan established the five core cultural values of AppDirect – humility, true north, intensity, ownership and positive mental attitude – which guide the company’s overall vision. Dan credits these values for the company’s success, and mentors employees on embracing them as each individual grows in their career. An innovative thinker, he approaches each goal with a framework and plan for achievement, leading to his success. A sought-after expert in cloud and startup innovation, Dan was named as one of the 100 Most Intriguing Entrepreneurs of 2017 by Goldman Sachs and appeared on the 2015 Forbes 30 Under 30 Enterprise Technology list. He was also the recipient of the prestigious McGill University Young Inspiration Achievement Award in 2018, part of the Desautels Management Achievement Awards, which honors business leaders who have made significant contributions to society. Dan has spoken at numerous industry conferences, including Web Summit, Collision, CeBIT, among others. He is an advisor for the venture capital fund 8VC, and serves on McGill University’s International Advisory Board. He holds degrees from McGill and Harvard universities.