Assessing an ISV’s channel skills: Two perspectives that may not match

What does it take for an ISV to run a successful reseller channel? Paul Solski of AIM International lays out a challenging self-assessment that would test the channel management skills and performance of most ISVs.

And almost as interesting as Paul’s excellent quiz is the response of one of our readers.  A sales and marketing manager for a Microsoft Dynamics reseller, the reader manages his company’s ISV relationships and drives home the importance of Solski’s points by sharing his perspective - without mincing words.

There are several key points to the comment (it’s really more of a response article - nicely done). One that he comes back to a few times is the idea that ISVs need to demonstrate that they are making marketing and sales investments that help their resellers not only sell the add-on solution but help their reseller do more business and improve their bottom line.

“The truth is most [ISVs] want something from me...access to my customer and prospect base but have little to offer me. Oh sure...there's some margin on sales. That's not much of a reason for me to take on a new ISV unless I've got some unique selling situation that's probably a 'one off' deal.”

Part of the problem with many ISVs, he says, is a lack of either awareness or recognition that resellers are motivated by incentives that help them do good business for themselves - more deals and better and more profitable projects.

“What makes you different from the other ISVs? Do you even know who your competitors are? I probably have a relationship with them so why are you better? Why the heck should I do business with you? Are you going to bring me leads? You don't do any of your own industry Marketing, have no brand recognition and just expect partners to hand you business? You're not adding any value to me.”

A new report by security and network hardware vendor Enterasys highlights some of the same key issues that drive partners away from selling your product (albeit these findings were from the technology hardware realm). The top five issues in their report were:

  1. Lack of sales leads provided by vendors;

  2. Channel conflict or over-distributed channels that lead to too much competition for too few sales;

  3. Poor support.

  4. Insufficient ROI/profitability

  5. Lack of understanding of the partner business.  

From our perspective as a provider of marketing services, one of the most common misconceptions we hear from ISVs is that they don’t think they need to have a lead generation strategy because they only sell through a partner channel. In their minds, they just need to manage their partners and incentivize them properly.

But chances are your competitors in the Dynamics space, at least the more successful ones, are winning over more resellers than you because they have invested in a consistent, ongoing source of leads that they can share with their resellers around the globe. In combination with other marketing investments to boost awareness, messaging, and thought leadership, a strong supply of leads signals to an ISV’s channel that they are making real investments in their reseller relationship, month after month.  By contrast, pushing out a pile of leads a couple of times a year from trade shows may be nice, but it is not going to sustain resellers who need to close new business quarter after quarter.

The last bit from our commenter that I wanted to touch on might be best handled by a marriage counselor, but I’ll take a shot at it here:

“...your ‘all’ is never really ‘all’. I've still got to find the lead, nurture it, coordinate and bring it to you to demo, then propose and close. I'd argue I'm doing all the work ‘show up and throw up’ in a 1 hour demo and want to get paid a big chunk! ”

You can almost feel the exasperation in these words. As much as ISVs get frustrated when their resellers fail to bring them into deals, part of the reseller’s thinking goes beyond just the immediate deals in the pipeline. Every time they have an opportunity on the table, the reseller says to himself something like, “Do I really want to bring this ISV solution into the deal? Is it just going cause me heartburn to see them take dollars off the table after all the work I’ve done?” Rightfully or not, that’s the sentiment.  

If you are creating opportunities for your channel partners and doing some of the other things that Solski and our candid commenter suggest to manage your partner relationships, you’ll not only be front of mind, but you’ll be in a position of favor rather than bitterness.

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