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How Incentives Prevent Sales Channel Partnerships from Failing

Conflicting interests and lack of trust are the biggest obstacles to healthy, profitable channel sales partnerships. Vendors might be interested in selling as many products as possible through as many resellers as they can, for example, while resellers such as contractors are interested in selling more (and better) products than competing resellers. Ultimately, all parties are running a business and are looking out for Number One. This can lead to a lack of trust between channel partners. One of the best channel management strategies you can utilize to overcome these conflicts and align partners’ goals with yours is a channel incentives program.

Strategically using channel incentives to accomplish these four things will lead to longer-lasting, more mutually beneficial relationships:

1) Online and mobile incentive technology makes things easy for contractors.

A tedious and time-consuming incentive program won’t improve your channel relationships. Adding sales claims paperwork to the channel sales process and waiting around to receive cash or a reward deposit won’t sound tempting to your partners. But, if you can provide an easy-to-use online rewards program with immediately gratifying benefits? That gets your channel partner’s attention.When you use online rewards programs like Loyaltyworks’, rewards are delivered automatically through “cyber currency,” or online reward points. These points can be redeemed immediately through any online-capable device, in a rewards catalog with millions of merchandise rewards, event tickets and travel opportunities.

Loyaltyworks mobile app technology takes the online rewards concept one step further. Even when they’re on-site, distributors and contractors can use their rewards app to instantly submit purchase information to you with their smartphones, either by scanning UPCs or snapping a picture. With automated claims auditing on top of all that, program participants get their rewards instantly. Boom—channel partners see immediate business and personal value in your rewards program, which builds trust and loyalty to your brand.

2. Training incentives increase product knowledge and brand familiarity.

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Before you have confidence in something, you have to understand it. Your relationships with channel partners will only stand the test of time once they know more about you. According to channel marketing expert George Boykin, educating channel partners “proactively instill[s] them with confidence about your products, thereby reducing their fear of financial loss from using their assets to sell your products.”Offer partners incentive rewards for submitting feedback, filling out surveys, passing quizzes, or completing online training. Establishing a stronger foundation of knowledge and familiarity with your company will increase your channel partners’ trust in you. They will better understand your differentiators, which will elevate their confidence in pushing your products or services.

3. Sales promotion incentives help partners beat the competition.

Create a rewards system in which you and your channel partners both benefit from the increased sales of qualifying products. If you’re a manufacturer, you can offer your resellers rewards for purchasing your products or services, giving them the incentive to choose to do business with you before anyone else.If you’re a distributor, invite your vendors to participate in a bonus points sales promotion in which buyers earn online reward points for purchasing certain products. This gives manufacturers the advantage over competition, allowing them (and you) to steal market share.

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4. Incentive program performance data helps your channel marketing strategies.

Advanced incentive software like Loyaltyworks’ allows you to schedule multiple, simultaneous sales promotions at any time and export detailed reports about incentive program performance. Analyzing this data can help you immensely in identifying pain points and growth opportunities so you can improve sales and marketing strategies. Guess who else benefits from that kind of knowledge? Yep, your channel partners.When you share valuable sales data with your channel partners, not only will they appreciate the marketing insights to help with sales plans, they will become more attached to your organization because they’ll see and understand the impact they have on your business. Not to mention, sharing sales insights with your channel partners will open the door for them to do the same. When you collaborate, you can create even stronger channel sales strategies.

Channel management has a reputation for being difficult, with highly informed channel partners being choosy about who they do business with. But it’s actually easier than ever to build strong channel sales partnerships and become a trusted advisor to your manufacturers, distributors, resellers or contractors. Today’s online technology provides you even more ways to get creative with incentive ideas and breathe new life into channel marketing strategies.

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