The strength of your Partner Proposition is a key driver of success in your partner program. Companies spend years developing their Customer Proposition and relatively little effort on their Partner Proposition.
The greatest waste of money in sales is spending time trying to sell to an unsuitable customer. We fill our pipelines with prospects who will never buy, as they may be too small, too big, undecided, or just got there by mistake. Businesses start and grow by clarifying their ideal customer and selling them the products they need. The fastest-growing companies have achieved product-market-fit meeting customers’ needs better than others.
Customer Propositions focus on solving customers’ needs and ask the customer to change for better processes or tools to get better results. The ‘better result’ needs to justify the cost of change. The more compelling customer propositions reduce barriers and cost-of-change for the customer. Do keep in mind, for many customers, their cost of change is higher than what they are paying you for your software. Customers always have alternatives, including your direct competition, status quo, spreadsheets, and even paper.
Where so many businesses became successful through meeting customers’ needs, they somehow forget to invest the effort in Partner Proposition when engaging partners. Where Customer Propositions need to vary depending on the customer type, companies expect their Partner Propositions to be one-size-fits-all. In many Partner Propositions, the focus is on how the Partner’s business needs to change its business to adapt to the great opportunity you are offering.
Why Partner Proposition is Important?
The big failing in many Partner Propositions is the assumption that the business goals are the same for all partner types; to simply make more money. Consider a Reseller Partner’s business focus on targets of a mix of consulting or services revenues plus license revenue share in up-front, recurring revenues, or both. Your Partners’ Business models vary from project-based with upfront implementation projects to managed services or SaaS models with ongoing recurring revenues. A strong Partner Proposition aligns with the business model of the partners, with a compatible and comparable deal size and deal shape. The deal size may be smaller or larger than what they currently sell, but not excessively so.
As in the question covered in TenegoTV Q&A: “Can a small company partner with a very large company?”, it’s down to how suitable the Partner Proposition is to the very large company partner.
If you believe a company type would make a suitable partner, review the potential partner based on the following criteria against Your Partner Proposition:
-What are their business goals, and how does your Partner Proposition help them meet their goals?
-What is their revenue model, the mix of licenses and services of different skills, and how does your Partner Proposition boost their revenues across the current mix
-How does your Partner Proposition compare against the alternatives available to the potential Partner?
How do you help them grow revenues and margins from existing customers?
-Can your Proposition help them win more new customers, better than they can today?
–Can you offer a higher return on investment?
–Can you offer them faster success to meet their goals?
The points above offer a basic assessment to help shape your approach to different types of partners.