Like many industries, the Channel has undergone some fairly dramatic shifts in the past few years. Organizations have begun to change how their products are sold, distributed, implemented, and supported. With a more flexible buyer journey, a higher emphasis has been placed on not just finding any channel partner, but on finding the right channel partner.

Channel marketing has had to adjust to this change as organizations look to get the most out of these partnerships. It’s vital that channel marketing strategy and incentives align to match the goals of the partnership.

With that in mind, here are some of the top channel marketing trends that I’ve noticed taking hold in the industry to help support this shift.

Movement Towards Competencies

A competency-based channel program is an alternative to the traditional revenue-based partner program. With a revenue-based approach, the dollar amount an organization transacts within a year determines their partner level (Gold, Silver, Platinum, etc.) and partners are entitled to certain incentives and benefits based on their tier.

An alternative to the revenue-based channel model is a competency-based model. In this model, partners are rewarded based on training they take or certifications they receive (i.e. competencies). These competencies then determine the type of investment that the vendor makes in the partner. Revenue is still typically a component, but not the primary driver.

But why is this important?

I think we can all agree that for most companies, channel revenue doesn’t always tell the story of who makes the best partners and why. Large partners may transact the most amount of dollars, but can be difficult to work with. Competencies have the ability to create a more level playing field and allow vendors to shift their focus toward partners that have invested time and effort. In other words, you invest in me, and we’ll invest in you. From a marketing standpoint, this can be a great way to work with partners that have a particular niche, focus, or a highly engaged audience.

Per-Activity Based MDF

Sticking with the theme of a competency-based approach, another trend I’ve noticed is the shift towards MDF being rewarded on a per-activity basis. In a traditional MDF program, the partner that transacts the most revenue receives the most MDF. But as mentioned above, when it comes to the channel, revenue is only a piece of the puzzle — it doesn’t usually give the whole picture. Distributing MDF based on the dollar amount a partner transacts can leave a lot of money on the table. More importantly, it overlooks the reason why MDF is distributed in the first place.

MDF is an incentive and should be used to drive ideal partner behavior. “Ideal partner behavior” is different for each vendor and typically changes over time. For some, the immediate goal may be demand generation; for others, it’s brand awareness. Each channel partner also has their own speciality and MDF should be used as a tool to incentivize partners that align with the goals for your organization.

Revenue is, of course, the ultimate goal for any organization, but revenue-based MDF distribution overlooks the fact that some partners are better suited than others at driving relevant marketing. Opening MDF to more partners and approving requests based on the activity type allows for this flexibility and helps ensure that MDF is being used as intended.

Re-thinking Demand Gen

There’s no denying over the past couple years, marketers have had to re-think their demand gen strategies. Early in the pandemic, when in-person events were being canceled and everything started going virtual, webinars became the go-to demand generation activity. But the pendulum quickly swung a bit too far in the webinar direction. Prospects, customers, and yes, even us marketers, started to suffer from major webinar fatigue. Attendance rates began to decline as did general interest and engagement.

With the world starting to open back up again (fingers crossed, knock on wood, find a lucky penny), it’s time again for vendors to start re-rethinking our through-channel demand gen strategies. In my opinion, this is the perfect time for the channel to fully embrace digital advertising and SEO. These are marketing disciplines that the direct marketing world embraced a long time ago, but channel partners have been very slow to adopt and vendors have been even slower to adopt as a legitimate through-partner tactic.

Charles Sanders currently serves as the Principal Partner Marketing Manager at Puppet where he’s been since 2021. Prior to joining Puppet, he spent many years working at various startups in the cybersecurity industry building partner programs and working with partners all over the world. Charles earned his Bachelor’s and Master’s Degrees in Marketing from the University of Michigan and currently resides in his home state of Michigan with his wife, daughter, and Great Dane. Visit his LinkedIn profile here.