In the last six months, the Channel Maven team has had at least a dozen conversations where a company is being acquired, acquiring another organization or being divested/split. At least three of those conversations were the latter and all this shifting has us thinking, how do you keep your Channel calm and engaged during times of turmoil?
Mergers and Acquisitions Impact The Channel
Partners won’t slow their business down simply because Vendors are making a large corporate shift. Instead, if confusion surrounds a split or acquisition, Partners steer buyers toward another solution and often form partnerships with new Vendors to bridge the gap.
Understanding challenges inherent in the Vendor-Partner dynamic throughout a corporate shift is critical to the long-term success of your Channel. Conversely, a protracted or head-in-the sand approach destroys trust and causes long-term damage due to the uphill battle required to forge or repair relationships with new and existing Partners.
Whether this shift is good news or a little scary, Partners always think the worst if not told otherwise. It’s important they hear the benefits, concerns and future benefits directly from you. And, by ‘you,’ I mean their field as well so, be sure they’re on board with helping deliver your message to Partners too.
Mergers or Acquisitions Fail (a lot)
According to experts, 50% of mergers and acquisitions fail. This is not news to those working in Telecommunications and IT Channels. We’ve seen the failures unfold in real-time and most of us have, at least once, been casualties of the aftermath or jumped ship and watched the fallout from afar.
The mere mention of merger or acquisition, a rumor, or even a hint in the air sends employees on both sides into a tailspin. What if my position is eliminated? What about my long-term goals? Will I have to move to keep my job?
It does the same thing to Partners. What does this mean for the future of my business? How does this impact my Vendor relationship? How do I safeguard clients, field their questions and weather the transitional storm?
Communicate. Communicate. Communicate.
We find that communication with Partners about merger or acquisition is often delayed until the Vendor feels they know the whole story. This is a mistake. Partners are business savvy and looped into the rumor mill, especially with their Vendors. And, today’s end users are more informed than ever, equally savvy when it comes to merger and acquisition news and ask questions of the Partners.
Think about it from the Partner’s perspective.
Your client needs solutions today but you’re unsure of your Vendor because they’re involved in a merger or acquisition. You have no idea how the situation impacts offerings, the Vendor-Partner relationship, the longevity of the solutions or your bottom-line. You also know prospects will likely ask about this if you recommend that Vendor and you have no answers.
What do you do?
Partners with options from multiple Vendors may choose to sell other solutions because it’s the quickest route to a satisfied customer without a cloudy future. And, once a Partner begins dropping the Vendor from sales conversations, it’s an uphill battle to win back mind-share.
Transparency Breeds Trust
When wondering how to keep Partners engaged and selling your solutions throughout the process, consider this:
"If you want people to make the same decisions you would, but in a more scalable way, you have to give them the same information you have" - Keith Rabois, Technology Investor
Complete transparency might not be feasible but there’s a good case for being as transparent as possible with Partners throughout a merger or acquisition, even if it’s just to tell them you don’t yet know a lot. The more you share, the more trust you build and trust is a cornerstone of all lasting relationships.
Each merger or acquisition has a unique story and each group of Partners need a well-crafted story to tell their prospects. Top tier Partners require a more robust story, more facts, and more communication than those who sell sporadically.
Think about the needs of your Partners and divide them into groups. Provide each group with the information they need for their situation. Doing so will help preserve the trust you’ve worked so hard to build and help Partners preserve the trust they’ve cultivated with the end-user.
Stay Top-of-Mind Throughout the Merger or Acquisition Lifecycle
Communicate with Partners at every step and do so in the way they want to receive information. Reach out quickly, explain the situation, the impact on them and tell them as much information as you can. Then, ask how and when they want to stay updated. Is it a weekly email, a monthly newsletter, or a quarterly phone call?
Plan webinars or conference calls and align the content with Partner tiers. Keep the top tier completely in the loop but don’t inundate the others with communication they don’t want or need.
Partners and end-users are more informed and savvy than ever so stories need to address specific needs of each Partner tier and their unique buyers. How will this merger or acquisition benefit them? What about this process will make them more money, make their business easier to run and ultimately impact them positively?
What questions might buyers have and how will you arm Partners with the information needed to address these questions in a way that helps close deals and generate demand?
Communication Plans are Key
We’ve seen Partner communication plans fall to the bottom of the Vendor’s to-do list. Don’t let this happen to your Channel. Remember; Partners are independent businesses with many Vendors to choose from and they each have a unique customer set with specific needs.
While 50% of mergers or acquisitions fail, it doesn’t mean yours has to be one of those. Planning ahead, transparency and building the stories needed to drive more demand will help build a unified Channel throughout the transition and into the future.