How can you manage a consistently productive indirect sales channel? By establishing a baseline for existing partner productivity and taking proactive steps to consistently improve the factors that drive higher levels of performance. Have you established a baseline for channel partner productivity? View the presentation to learn more ...

1. How to Raise Channel
Partner Productivity
Virtual CMO Marketing Services
Strategy | Execution | Impact
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Dave Zwicker, Virtual CMO
February 2016

2. Copyright © 2016 Virtual CMO
Channel Partner Productivity
• Market dynamics are affecting channel partner productivity
– Many partners are managing a business transformation:
• From one-time revenue (e.g., VAR) to recurring revenue (e.g., MSP or CSP)
• From premise-based technology to cloud-based technology
– Many vendors are changing their business and technology focus:
• Less hardware, more software, everything going to the cloud
• Vendors typically need more partners with the right profile:
– Company size, market focus, staffing, skills and vendor commitment
– An appropriate business model (VAR, MSP, CSP, IT Consulting or hybrid)
• And Partners always struggle with sales and marketing …
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3. Copyright © 2016 Virtual CMO
The Key Questions to Ask
• What is the average partner productivity?
• How much revenue generated per month, quarter, year?
• What is the average rate of customer acquisition?
• It’s not the top performers & it’s not the non-performers
• Average performers determine the productivity baseline
• How can average partner productivity be improved?
– By assessing five key channel productivity factors
– Small improvements in each area will combine to drive major growth
in total channel revenue
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4. Copyright © 2016 Virtual CMO
Five Productivity Factors
• Average Contract Value
– Often a function of revenue per user
– And the average number of users per customer
• Customer Acquisition Rate
– The number of new deals a partner closes each month
– A function of the size of the pipeline and the efficiency the partners’ sales function
• One-Time Revenue vs. Monthly Recurring Revenue
– OTR has greater short-term value but requires higher deal volume for consistency
– MRR has a lower short-term value but predictable, long-term value to the business
• The Total Number of Productive Partners
– How can more productive partners be developed and/or recruited?
– How can partner productivity be increased from average to ideal?
• The Revenue Sharing Strategy
– How can partners be incented to sell more?
– Do all partners earn their share of the revenue?
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5. Copyright © 2016 Virtual CMO
Existing vs. Ideal Productivity
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Increase the
average customer
size by 5 users
Increase OTR and
MRR by $10/user
This adds $500 to the
average deal value
Grow the number of
productive partners
from 75 to 150
Increase the customer
acquisition rate from 1
deal/month to 1.5
deals/month
No change in the
revenue sharing
percentage
No change in the mix
of OTR to MRR
Sample Inputs:
Copyright © 2016 Virtual CMO

6. Copyright © 2016 Virtual CMO
Projecting the Revenue Impact
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These models
show the 3-year
vendor and
partner revenue
streams based on
existing & ideal
productivity
assumptions
They provide a
detailed view of
the improvements
resulting from
each of the five
productivity
factors

7. Copyright © 2016 Virtual CMO
Evaluating the Results
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Here is a quarterly revenue
summary based on existing
partner productivity data
Here is a quarterly revenue
summary based on ideal
partner productivity targets
The improvements modeled
on slide #5 will drive a 350%
increase in channel revenue!

8. Copyright © 2016 Virtual CMO
Accelerating Revenue Growth
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Here is a graphical view of the existing and ideal revenue results

9. Copyright © 2016 Virtual CMO
A Partner Productivity Plan
1. Establish a partner productivity baseline
– Gather historical performance data
– Conduct partner interviews and analyze findings
2. Set achievable productivity improvement targets
– Identify areas of productivity improvement from partner assessment
– Gauge the revenue impact from the five productivity factors
3. Determine the required programs and actions
– Design partner-focused lead generation programs
– Launch a targeted partner recruitment program
– Create upsell/cross-sell/pricing/bundling programs
– Develop partner resources and training programs
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10. Thank You
Email: dave@vcmo.net
Website: www.vcmo.net
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Read the blog post:
http://vcmo.net/how-to-raise-channel-partner-productivity/
To request the model, just drop me an email …