According to the Channel Marketer Report, $25 Billion in MDF and co-op funds go unused every year. That’s concerning. But, what’s more concerning is how much MDF is used on activities with no chance of driving demand.
That’s what MDF is for by the way. Just in case you thought it was so your Partners could take their current customers and buddies all golfing. Yeah, not so much.
While ten years ago golf events or tickets to a baseball game worked (it really didn’t drive new business but let’s pretend it did) it certainly doesn’t work anymore. Today’s Partners need to fill the funnel at the very top with lots of contacts, a percentage of which will turn into leads, a smaller percentage will turn into opportunities and an even smaller percentage turn into deals.
In this two-part blog we will cover how to make MDF a successful benefit of any partner program. First I want to talk about what you, the Vendors and Manufacturers, can do to make sure Partners aren’t leaving money on the table, (LITERALLY). In the follow-up post, I’ll talk to you and your Channel Partners about what they should be spending your MDF on to successfully drive demand.
Here are 5 ways to ensure Partners are using their MDF well
Communicate the value: At the beginning of each quarter have your Partner facing teams email your Partners to inform them how much MDF they have and by when they need to use. Offer suggestions for how to use MDF effectively and create a communications plan that includes social media posts from your executive team and corporate social media profiles. Steven Kellam of CCI Global Channel Management adds, “We usually use a benchmark of 85%+ for best practices of fund utilization. The vendors who are in the 85%+ area are super strong in communications, have worked hard to simplify their guidelines and get payments into the Partners hands in less than 21 days. We have clients who are actually delivering payments to Partners in less than 14 days”.
Challenger Sale: Inform Partners about what their competitors are doing. Most likely you have a Partner who manages their MDF like a pro every quarter. Writing a blog post about Partners who are doing it right shows other Partners it can be done and shows them you have other Partners doing a better job of representing you to their customers. Nothing like applying The Challenger Sale to stir up motivation.
Provide 3rd Party Options: Some of our Vendor clients do a great job providing Partners with a catalog of options for traditional and new marketing best practices including SEO, Social Media consulting, blog creation, email execution and virtual event support. Wouldn’t you rather Partners use MDF to create a stronger list they can market to all year than a list they bought full of people who won’t open their emails? Stay tuned, there’s more on that in Part II of this blog.
Show me the Money: Okay, guilty, I’m watching ‘Any Given Sunday’ while writing this blog and football movies all remind me of Jerry McGuire. But I digress. Show Partners the money, the leads, and the analytics. Show them what they can accomplish if they do things right. And, make this conversation a longer-term conversation not just a quarterly conversation. If you show a Partner a quarter they got 20 leads and zero deals they might get disappointed. But, showing them a quarter later how those 20 leads turned into 2 deals that more than paid for the effort, is well worth it.
Back to Basics: One of the best things you can do, and you’re going to laugh when I tell you how simple it is, has to do with Partners’ calendars. Have your Partner facing teams send them a calendar invite 30 days before the end of the quarter reminding them to use their MDF. That’s it. Do it every quarter, maybe even have them put something in the notes section with suggestions around what to use the MDF for and how much they have to spend.
What else would you do to help ensure Partners are using their MDF? Tune in next week when we talk to Partners about ways MDF best practices. We’d love your input! Don’t forget to tune in next week when we talk to your Partners about what they should be using MDF to accomplish!
Photo credit: Market One Executive, Epiphany Finacial