How to ensure MDF programs help vendors and channel partners reach their goals
The pandemic has driven many businesses to accelerate their digital transformation strategies, creating new opportunities for channel partners to work as trusted advisors with their customers. Developing and maintaining strong relationships between vendors and potential and current channel partners can be vital to success, and market development funds (MDF) programs can support this.
MDF can form a key part of a business strategy for organisations that operate within the IT channel ecosystem. MDF lets channel partners deploy marketing campaigns to benefit the vendor and the partner; however, they can be complex and involve many moving parts and stakeholders.
In reality, it can be a challenge for vendors to use MDF as effectively as possible. The four common challenges with MDF programs are:
- lack of awareness
- unclear messaging
- under-resourcing
- lack of support.
However, when successful, an MDF program can lead to the following benefits:
- lead generation and increased revenue and business opportunities
- targeted campaign opportunities that let vendors and partners reach more potential buyers together
- stronger partnerships between vendors and partners for the companies’ mutual benefit.
While it may be true that running a successful MDF program is not as simple as it should be, it’s also not as complicated as channel partners often think, either. For the most part, channel partners and vendors avoid MDF programs because they don’t know how to run one successfully and are making decisions that aren’t properly conceived and executed.
There are three main ways to ensure MDF programs help vendors and channel partners to reach their goals:
1. Choose your strategic channel partners wisely
Selecting the right partners is essential for strategic growth. The right decision has the potential to boost sales volumes and create new and exciting lead opportunities. By leveraging the resources and position of an external channel partner, channel sales help vendors bypass the challenges that come with scaling up.
By partnering with a strong channel seller, vendors can look to enter new markets and make sales without the typical operational hurdles that an expansion can bring. However, the wrong decision can contribute to wasted money and resources, exposing the vendor and partner to unnecessary risks. That’s why it’s important to choose partners that will take full advantage of a tailored MDF program.
Vendors should consider channel partners with similar long-term goals and visions or mature partners with existing strong market resources. By working together and nurturing a variety of different types of partners, a relationship can flourish and produce significant benefits in the future as the two teams work together to continue to grow.
When choosing the right channel partner, consider the following qualifiers:
- Do they add value to your product?
- Are they aligned with your market?
- Are they up to speed on your company’s products?
- Do they follow a similar sales process?
Significant business benefits are available to channel partners that choose the right vendor partnership. It can also increase partner loyalty and build longer-term relationships, helping vendors keep track of how they are performing and identify how to build on their strengths.
2. Define the project plan for your MDF program
In the past, vendor marketing funds were often under-utilised due to a lack of clear project planning. Running a winning MDF program requires a clearly defined plan that makes reaching the goal much more manageable. Having a well-executed MDF program plan decreases stress, inspires confidence, and drives communication. These are all essential factors for a high-performing team.
After selecting partners carefully, it’s important to ensure both the partners and vendors can follow a dedicated MDF timeline so campaigns can be successfully implemented, monitored, optimised, and measured. Regular communication is crucial, as is tracking and monitoring all working components to ensure the project is moving ahead according to milestones and goals.
A detailed campaign action plan should include information on the following:
- program budgets
- program type
- funding method
- strategies and policies
- program management
- marketing assets and activities
- metrics that will be monitored
- reporting rhythms
- target outcomes.
These are some tips that drive MDF program planning success:
- keep it simple
- choose the right channel partners
- select the right program
- track progress
- share success to drive program adoption.
MDF programs can be complex and involve lots of moving parts. MDF that remains unspent represents a lost opportunity, so it’s important to define and follow a well-managed program with a plan and key performance indicators (KPIs).
3. Track campaign and channel partner performance
With any program, it’s important to track progress to understand which programs are working, which ones aren’t or need improvement, and ways to better budget for future MDF programs. Collecting data throughout the MDF program helps vendors become more targeted with their partners, products, and spending choices, which leads to higher return on investment (ROI).
Understanding campaign and partner performance provides several key benefits, such as:
- increases efficiency
- helps to define business goals
- provides new opportunities for discovery
- enhances partner motivation.
The vendor should keep track of channel partner performance and engagement and set up touchpoints to measure if the program is delivering results. Then, they can measure the proofs of performance against different activity types and decide whether adjustments need to be made.
After tracking results and collecting data, it’s important to share successes and key findings with channel partners to improve program effectiveness and help drive program adoption.
Best practices for building a strong MDF program
MDF programs can be a huge asset when it comes to managed service provider (MSP) marketing. It also gives vendors the opportunity to leverage marketing knowledge and increase their ROI. An MDF program requires time to design and implement, but a strong result can accelerate business growth by expanding channel partners’ sales and marketing capabilities and efforts.
However, getting MDF programs right requires a big-picture approach, and an understanding of what partners need to do to expand the market for the vendor’s product or service. Every dollar of MDF left on the table is a wasted opportunity, which lets competitors gain ground and acquire customers.
MDF programs can be complex to manage, so it’s important to have a clear understanding and appreciation of the goals and expectations of the campaign. Recognising the considerations before developing an MDF program goes a long way towards achieving long-term goals. This whitepaper will help you further understand common challenges and considerations to maximise MDF program results and how to address customer pain points with viable solutions.
Engaging the services of a third-party provider like Outsource to support your channel partners with dedicated marketing support services can help significantly streamline the MDF marketing process and boost outcomes.
For more information on how to better support your channel partners and leverage MDF programs for better growth opportunities, contact the Outsource team today.
Or, download the whitepaper to find out more about how we can help you streamline your MDF programs.
