PartnerStrategyNetwork_Episode9
Wesley: Hello and welcome to the Partner Strategy Network podcast. I'm Wesley Coelho and I'm here with Mark Sochan. Hey Mark!
Mark: Hey Wesley. So what's today's topic?
Wesley: Today we're going to be talking about how to select the right mix of partner types for your business. So for example, do you need services partners, resellers, or do you want to focus more on strategic product partnerships? What's the most important partner type for you? And a lot of people overlook this step. And Mark, I was hoping you could tell us the classic story of how this happens.
Mark: Yeah. I remember speaking to David Weir at Bessemer Ventures and he told the story of a typical company CEO, who's a product guy at heart and he's built up this wonderful company. And now he's instructed by his board to build out a partner group to help scale the company. But he is a product guy.
He doesn't know much about partners. He goes and hires a VP of Alliances, sets up unrealistic expectations, and then things blow up 12 months later.
Wesley: Sounds like a total disaster. So how can CEOs avoid this classic mess?
Mark: Well, first, they need to start with a customer segmentation exercise. We're going to find your top priority segments. And then you consider the most effective go to market strategy for each as part of that go to market strategy. That's where you consider how partnerships can help you get there faster and more effectively and with greater leverage.
So with that said, what's why don't you tell us a bit more about how you identify what partner types you need?
Wesley: I would recommend taking a hard look at the nature of your products to identify the partners that are the best fit for your go-to-market strategy. For example, if your product can be considered a complimentary innovation that pairs well with another company's large and well-established product and customer base or maybe your product could be considered even an add on or a feature to another type of product where there's a combination of one plus one equals five type of combination. In that scenario, you'll be wanting to focus on making strategic OEM product partnerships.
Mark: Right. So it could be a strategic OEM product partnership, or it might be an ISV technical integration type partnership. Right.
Wesley: Absolutely.
Mark: So then tell us about services and more traditional channels.
Wesley: I think the other aspect of your product is to really look at the professional services requirement for it. If it requires a lot of professional services or you need a lot of implementation partners because you're a product company and you don't have enough services delivery capacity.
In that case, you're going to want to work with global system integrators or regional system integrators and make that a heavy part of your partner mix.
Mark: So tell me about how VARs fit into this?
Wesley: VARs can be a good fit for you if your product is at the right level of complexity. So for example, something that you sell off your website within a low touch high volume manner is not going to be a great fit for value added resellers or VARs. At the opposite extreme, if you have an extremely complicated product, that few other people can figure out how to operate and make money off of, then VARs are also not a good fit for you.
But if you're in this middle of the range, Goldilocks product level, where you've got some amount of complexity partner where customers need help to get up and running, but partners can learn how to use it and learn how to be successful with. You're good fit for this category. And VAR partners can be a big part of your partner strategy and they can help you scale up your sales.
Mark: Okay. And the key thing to keep in mind here is that for this bar approach a scale, you should have figured out how to sell direct first. Right? If you don't know how to sell the product yourself, a partner, isn't going to be able to figure it out either.
Wesley: That’s a very good point, mark. Absolutely. Thanks for the tips. And for more information on this, come and join the Partner Strategy Network, LinkedIn group.