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Top 4 Channel Incentive Pain Points

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When it comes to building channel partner incentive programs, there are a number of unique pain points that can prevent the programs from truly being successful.

These challenges can crop up from a variety of different sources: some might be internal, others external. Some challenges may be sales-related, while others arise within the marketing department. Some can be addressed with broad strokes, and others may require a more precise solution. 

Wherever the problems arise, it’s important to identify what issues might be in store when launching or maintaining a channel partner program. What is it exactly that makes these issues so challenging? 

Here are four of the top channel incentive pain points that we’ve identified.  

Maximizing a Partner Program Budget 

Squeezing the most out of your incentive budget is a frequent concern, whether you’re dealing with direct sales or operating a channel partner program. When old incentive methods produce mixed results and returns, you may need to think outside the box for new ways to stretch every dollar you have. 

Cumbersome program administration, coupled with challenges tracking ROI, often leads to inefficiency and internal dissatisfaction with a company’s rebate, spiff, and promotions programs. 

Moreover, companies often suffer from internal bandwidth challenges by mismanaging their human resources. Over-qualified employees may be asked to manage small, underwhelming channel partner incentive programs, leaving many of their talents unused. 

The simple solution is to simply make the budget match the buy-in. Of course, that’s easier said than done. But with proper data analysis and reporting in your program, you should be able to accurately attribute ROI and see net gains. 

Re-Inventing the Wheel Every Quarter & Year 

With that in mind, it’s easy to see how the pressure of finding new ways to do things can become a serious channel incentive pain point. 

The need to innovate goes together with the struggle to maximize your budget, and questions abound:  

  • What are we going to do this quarter? 
  • How are we going to spice things up?  
  • Should we reward for A or for B?  
  • What should the reward be this month?  
  • What is our competition doing right now? 

Forging ahead with this “reinvent the wheel” strategy can yield as many peaks as it can valleys, as many failures as triumphs. The trick, then, is to use your tools properly, and to learn to separate the truly utilitarian from the purely novel. 

In other words, find what works for you (and your channel partners) and stick to it. If you know your program participants are big sports fans, the campaign you can run each year can involve a sports theme, offer sports-related merchandise, or send them to the game of their choice. 

Now this doesn’t mean only doing the same promo year over year. You’ll want to spice it up every now and then. Maybe one year you could send them to the Big Game in February. Just make sure to measure your ROI against the increased cost.

Rewarding the Right Person at the Right Tier (The Point of Influence) 

With an incentive program targeting direct sales, you know exactly who to reward. However, with a channel partner incentive program, this can be one of your biggest pain points.  

Identifying, tracking, and incentivizing the right point of influence (in many cases a dealer salesperson or VAR sales engineer) becomes more challenging the further down the channel you go. 

One strategy to combat this problem involves automated tracking & approval, in conjunction with claims and workflow solutions. The key is rewarding the right person in the channel, while not overwhelming them with paperwork. 

You can also rely on the data captured by the enrollment process to glean more information about these points of influence. It doesn’t have to just be at enrollment, either. Find other exchanges that you can turn into opportunities to get more info on your partners. 

Balancing Regional and Global Strategies

Maybe your pool of channel partners has expanded to include companies with international capabilities. In this case, it’s critical to balance your respective regional and global strategies. 

Can you provide consistent solutions to these partners, even when each region has their own budget constraints and might work with 5-10 different vendors? Can you manage these obstacles and still maintain flexibility with the programs? 

Most importantly, how do you measure the success of these efforts when so many variables are in play? Let’s say your clients want the capability to roll all regional programs into one global bunch.  

Do you have a platform that automates your strategy on a global scale? Can you offer real-time reporting on the program’s global and regional impact on sales and market share? 

Conclusion 

There’s a lot that goes into channel partner incentive programs, and a lot of pain points that you might encounter. The four challenges highlighted here won’t be the only obstacles you’ll face when coming up with an innovative channel incentive solution. But they are among the biggest. 

But the first step of succeeding is knowing what can go wrong. Knowing about these common problems means you can be better prepared while setting your program up. Hopefully this will help you avoid these challenges in the future. 

If you want to learn more about what makes a channel incentive program successful, download our guide: The Definitive Guide for an Effective Channel Incentive Program. 

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Devin Ferreira

Authored by Devin Ferreira

Devin Ferreira has a passion for incentives. As a copywriter at 360Insights, his focus is on a variety of content development, including blogs, white papers, eBooks, and other marketing assets. In his free time, Devin enjoys hiking, camping, traveling, trying new foods, and spending time with family.