Martin Olsen of eOne posted a warning shot of sorts on the eOne blog this week. Fed up with inactive resellers of his company’s solutions to Dynamics GP customers, Olsen and eOne are taking a stand: if you aren’t helping us make the sale, you aren’t getting a cut of the revenue. And to take it a step further, eOne is putting more effort into controlling its own destiny with more direct sales efforts.
It is a wonderfully candid piece on the tightrope that ISVs walk in the Dynamics space – managing a channel that has great promise but sometimes fails to live up to its potential.
To summarize Olsen’s point and his dilemma, he has knows that while a strong reseller channel among Dynamics GP VARs can sell eOne’s software, it can get complicated and frustrating quickly. Like when a prospect comes to eOne directly, what happens if their Dynamics partner is a less-than-enthusiastic eOne reseller? eOne makes the sale, but should the VAR still get a cut?
eOne have reached a reasonable conclusion – that they are going to continue to work directly with their “good” Dynamics GP VARs, but they are going to also increase their direct marketing to the GP user base. This is a great idea. ISVs who put all their trust in a reseller channel are giving up some serious control of their destiny and letting important parts of their marketing identity slip away.
There are few reasons why charging into the fray on direct sales makes good sense for an ISV. First, if you are not marketing your solution to both partners and prospects, then you are not developing the full identity of your company and products in the marketplace. If you are focused only on shipping great software for your partners to sell, then you are not really owning the challenge that Dynamics partners face every day – explaining the value of the solution in a way that makes people want to buy it.
No one understands the problem you are solving better than you do, and no one believes in it more. But without something compelling to talk about in the marketplace, your efforts at direct sales in the crowded Dynamics ecosystem will not go far. Or to put it another way – who can explain the value of your product more effectively – someone from your team who eats, sleeps, and breathes it, or a reseller who shows it to one out of five prospects (mixed in with the ten other add-on solutions they resell)?
Any marketing team (or even a CMO-for-hire) worth its weight should be able to channel that passion and expertise into tangible marketing collateral that positions your firm as a thought leader in addition to being a great software house. .
Beyond direct sales, there is a simple way to gain traction with VARs that shockingly few ISVs have adopted. While you’re investing in your own demand and lead generation, start bringing some of these leads to your most strategic resellers on a regular basis. Bring leads to the ones who will appreciate them, pursue them actively with you, and also have a chance to witness your company’s appeal first hand.
And the other upside to a direct approach, as eOne seems to embrace – if you’re putting in place the tools and capabilities to generate your own leads, you are hedging against the waxing and waning interest of the Dynamics channel. In other words, go ahead and share leads, share marketing materials, and share your industry expertise to strengthen VAR relationships when it makes sense, but know that you can always put those powers to use going direct when you need to.
What does it take to get serious about adding direct sales and marketing to your software business? For one thing, get ready to re-evaluate and re-tool your marketing strategy with a focus on initiatives that you may have avoided until now. To be specific, the lack of investments in quality marketing content continues to hinder a huge number of ISVs selling into the Dynamics channel, keeping them dependent on that love/hate relationship with VARs.
But the bottom line is this – when you do invest in your own direct marketing efforts, keep your investments measurable and keep them tied to the leads, prospects, opportunities, and sales you can generate. If you can’t measure the benefit and tie it back to selling more software in some tangible way, then skip it. Your time and money are too valuable. After all, you’ve got great software to create.
