Wednesday, May 26, 2004

What Are You Measuring?

The hard part about designing or refreshing isn't deciding which benefits to bestow on your channel. It isn't even deciding how to pitch it. While both of those can be challenging, they are a walk in the park compared to deciding what you really want out of your channel. It is getting the objectives right that is the trick.

My friend Dr. Brad Spencer hit this topic again in his e mail newsletter. (I have to get him blogging so I can link to him instead of quoting him.) In talking about an article in the LA times, "Its all Geek to Me" about the book Moneyball, Brad makes the following point.

"I challenge you to put the book down without asking the question, "What am I measuring in my company (or life)." The implications of the answer are far reaching. The specifics of who you hire, fire, promote, etc. are all based on what you see as the key variable to outstanding performance. Judging against irrelevant categories can prove disastrous."

Like Brad, my favorite pastime is business. I am also looking for the "geeks" who want to figure out what makes business work.

Scott Karren, The Channel Pro

Time out of Field

What is "time out of the field?" At the end of the quarter, sales people resist anything that takes them out of the field. But to know what that is requires a better definition of "in the field." Clearly face-to-face meetings are "in the field." Same for writing a proposal and providing techincal support.

What about thinking about the customers business issues? Reading analyst reports, Modeling the market? Writing a blog? Assessing ROI on BDF? Judging customer competencies?

Seems to me that many companies do not really know what they are paying their reps to do. May 14th's post in this blog identifies several different roles for a rep. None are inherently good or bad, although some have more value add than others. Sales effectiveness comes from rewarding the desired behavior.

Scott Karren, The Channel Pro

The Channel Pro

At Channel Ventures ( we recently looked at major trends in the channel. One trend is the consolidation of traditional reseller programs with ISV programs. Instead of being a completely different program, ISVs are now becoming a segment of the larger channel. This has big implications for ISVs in terms of support, MDF and visibility. Other trends are the increase in alliance marketing, an active VC market, declining margins and the use of mixed business models that tie services to the software.

What other trends do you see facing the ISV today?

What Does it Take to Sell Successfully to Enterprises?

Very few firms get venture funding. In fact many VCs want to see that you can generate sales BEFORE they invest. This creates a catch 22. If you need VC money to get sales and need sales to get VC money. (Talk to Venlogic to evaluate your preparation and likelihood of receiving VC funding.) You have a better chance if you focus on your sales and marketing issues instead.

The most important issue in pitching a big company is why they are buying. In the last 15 years I have started four start up companies and sold over $50M in services to large companies. I have closed sales from seminars, cold calls, alliances, RFQs, trade shows, alliances and field sales. Only one thing really matters: your impact on their business performance. This and this alone will ultimately determine not only whether they buy, but the price they pay. This is the core of your value proposition.

Whether or not you have VC funding is more about you than about them. Which is more powerful: "Hi, you should buy from us because we are venture funded." Hi, we can improve your return on assets, reduce bad debt, increase revenue per customer, etc." You have to link your message directly to something that they give a damn about.

A separate issue in selling to big companies is getting access to a decision maker and getting that decision maker to discuss his or her business performance issues with you. To do this you need to be knowledgeable (if not expert) about the market, the industry and the company.

Your marketing objective ought to be to create this type of visibility and reputation in the market. Alliances, channels, seminars, articles, blogs, publications, studies, trade shows, etc. All can be effective if you change the conversation in both your sales and marketing approach.

Scott Karren, The Channel Pro


Thursday, May 20, 2004

Scoble leads the way for Microsoft marketing blogs.

I loved Robert Scoble's ( comments on using blogs for marketing. Check out his article, "The Four-Letter Word That Can Get People Excited About Your Products" (

We deal with the same issues today with our clients. I am amazed that the technology companies are not making better use of their own technology. But perhaps I should be more patient. It took years for the marketing and channel people to get up on e mail too.

Scott Karren, The Channel Pro

Bill Gates told the CEOs at his summit that blogs should be included in their marketing efforts. One CEO down and 999 to go before the F1000 buy in. Microsoft says that they can track the approval in PR as people get a more human, personal touch to the company. Robert Scoble is the best example of what Gates is talking about at Microsoft. Grass roots efforts can make a difference!

Scott Karren, The Channel Pro


Friday, May 14, 2004

The Role of a Sales Rep
By Scott Karren

Often both a partner and a vendor want to work together more closely, but for some reason this does not happen. I recall a session with an account rep once who was preparing a value proposition to a distributor for a key project. Just weeks earlier the same distributor had told me that their key objective for the year was to increase business with the very vendor. So what went wrong?

In a way nothing. Both continue in the same old way they always had. The vendor made great products and the distributor bought them in volume, making them available to its resellers. Yet in another way, they completely missed the opportunity to do something bigger. Both need stronger demand with resellers. Both need to eliminate wasteful inefficiencies. Both need better communication. The real issues here are the role of the rep and the objectives for the relationship.

A rep can call on and touch an account, keeping mindshare high. “Hi, I’m your new IBM rep and I am just checking in on you. Here are some trinkets and I will be back again next month.” Just like detailing in retail environments, here the goal is to make sure the reseller’s mindshare is clean, orderly and conducive to the vendors business. I call this Channel Detailing.

Another role for the rep is account administration. Product availability, credit, authorization, billing, credits, and a host of other back office activities can be cumbersome to say the least. “Hi, I’m from Microsoft and I can help you get through our process and make it easier to work with us.” I recently became a distributor and reseller of Motorcat30 yachts from a small manufacturer in Poland. I needed a lot of help getting set up not only with Bond Yachts, but also with several ecosystem suppliers. New recruits and existing partners need a lot of help complying with vendor administrative systems, and a rep makes the process a whole lot easier. I call this Channel Concierges.

Problem resolution is another key rep role. When something has gone wrong and end user customers are screaming, the channel needs immediate help. “Hi I’m from Sun and I am your single point of contact, please leave your message after the beep.” Programs and platitudes are not enough here. We are talking about the reseller’s life blood. I call this Channel 911.

Moving from back office to the front office, another role of the rep is to promote the products. The traditional approach is to push the reseller adopt technologies as quickly as possible. “Hi, I’m from AMD and I would like to tell why our products are the most technologically advanced.” Resellers are inundated with product messages, some of them vital to their business. Creative approaches and value propositions abound, yet most of the marcom sent to channels falls on deaf ears. I call this Channel Awareness.

Out of the front office are the sales organizations of the partners. Their job is to identify, scope, propose and close enough end user business to hit their number and keep their business alive. “Hi, I’m from Oracle and I need to know how many licenses you will sell next quarter.” The reps at best often are seen as adding little value and at worst as bullies trying to hit their numbers on the backs of the channel. I call this Channel Stuffing.

Out in the market, the sales executive also has a role: business development. “Hi, I’m from Intel and I am here to help profitably grow your business.” If the rep has been properly trained, certified, and resourced they can bring incredible value to an account. Business intelligence, product positioning, consultative advice, links to corporate marketing, best practices, market insights and customer respect are just a few of the potential areas of impact. I call this Channel Management.

How you use the rep is up to you, but first you have to decide what you want out of your partners.

Scott Karren, The Channel Pro
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Wednesday, May 05, 2004

Creating Channel Strategy Requires Extensive Customer Contact

A recent project has reminded me forcefully about a law of channel marketing. No mater how well you know the subject or how well you know the topic, insightful strategy comes from frequent, intense customer interaction. At MSI we always had a research project as a major part of any strategy design project or program design project. The reason is that you need the feedback to get the subtle details right. I also need the interaction with real world business problems to keep me interested and on target.

Strategy, at least for me, is an interactive process. It is not created out of thin air. The magic happens when I am taking to customers. Ideas begin to spring up out of the thousands of other projects I have done and I can immediately test, validate and modify the idea. Any other approach yields narrow, inside-out perspectives and anemic strategies.
Scott Karren, The Channel Pro

New Executive at Channel Ventures

Channel Ventures has added Mr. Jeff Poole to its experienced group of channel executives. Look for his complete bio on the Channel Ventures site under Executives.

Mr. Poole is especially talented at program design and channel partner recruitment. Jeff was one of our VPs at MSI consulting and as held executive positions at hardware software and service companies, notably, 3COM, Intel, Channelwave. Whether you need to refresh your program, launch a new channel or fill in as an acting VP of channels, you can count on Jeff to deliver far beyond your expectations.

Scott Karren, The Channel Pro

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