The power of integrated marketing
Market development funds (MDF) are a tried and tested method to help vendors who use indirect sales channels—such as resellers, value-added resellers, and distributors—to build their pipeline, close sales, and extend a vendor’s brand. Used effectively, MDF subsidises the cost of marketing materials and activities to help a channel partner grow its business.
However, not all MDF programs are created equal. Some perform well (or even extremely well) while others do poorly, or the partners and vendors do not have visibility into how they performed at all. The difference? Often, it comes down to whether or not vendors and channel partners work with an integrated marketing agency.
Why MDF programs benefit from integrated marketing partners
On paper, MDF programs sound easy: distribute budget to multiple channel partners and then sit back and wait for the revenue to flow through the door. Unfortunately, the reality is often quite different.
To begin with, vendors who generate the best outcomes from MDF invest time and money to create libraries of globally sensitive guidelines and practical marketing support to help partners maximise MDF outcomes. This includes, for example, co-branding guidelines, pre-packaged campaigns, and tips to measure success.
Vendors also need to attach strings to MDF to make sure partners don’t inadvertently use vendor budgets inappropriately. MDF should always be spent in a specific time period on pre-approved marketing activities. Partners must capture, and report, specific metrics to prove return-on-investment (ROI) for monies spent. Many vendors offer MDF on a reimbursement basis only. This means that partners have to spend their own funds or co-pay upfront and share the campaign results to claim MDF reimbursement.
Few channel partners have dedicated marketing teams and, among those who do, scalable marketing is rarely a deep area of expertise. Accessing and using MDF budgets within vendor guidelines can quickly overwhelm lean partner teams who already have a day job and other competing priorities.
This is where an integrated marketing and PR agency brings great value to vendors.
Five ways partnering with an integrated marketing agency improves MDF results
There are five important areas where partnering with an integrated marketing agency can help positively transform MDF outcomes for vendors.
- Scalable campaign expertise. Some vendors don’t, or can’t, offer pre-packaged marketing programs for channel partners to leverage locally. Without the option to run a campaign “out of the box,” channel partners are on their own to develop strategies for data, messaging, creative, and all the execution touches that bring a campaign to life, both online and offline. With a business to run, there is little time to manage marketing and do it well. Campaigns are the core expertise of integrated marketing agencies as they can execute and deliver maximum impact in minimal time because campaign management is their primary business.
- Efficient claims and reimbursement. The right agency team is well-versed in following vendor processes to use MDF, whether by using an upfront spend, co-pay, or post-campaign reimbursement model. For the latter, it is critical the marketing activity conforms to the vendor’s MDF guidelines, otherwise channel partners risk not receiving reimbursement. Using an integrated marketing agency helps make sure MDF activities meet campaign compliance for efficient claims and reimbursement.
- Measurement. If there is one barrier to channel partner marketing, it’s the inability to capture and report the results the vendor needs to show to justify the MDF investment. In our digital era, integrated marketing agencies eat, sleep, and breathe metrics and measurement. And, they have the infrastructure and systems in place to capture marketing results. This means channel partners don’t have to upgrade their systems and vendors can still get the metrics they need.
- Reliable ROI. The tempo of change in the marketing discipline quickens every year. Agencies live this change daily, which means their teams are fluent in the marketing activities which work and, just as importantly, those that don’t. Engaging an integrated marketing agency to spend MDF means vendors can have confidence funds will go to areas which deliver maximum impact and meet MDF guidelines. Agencies are also ideally placed to suggest new campaigns to generate even better ROI through MDF.
- Save time. Vendor marketing funds are always linked to a specific business quarter and channel partners need to either “use it or lose it”. Unfortunately, many lose the MDF allocation because 90 days of a financial quarter flies by without marketing activity while the channel partner focuses on running their business. Imagine the freedom of handing over an MDF allocation to an integrated marketing agency and teaming them with a channel partner to deliver results? The channel partner saves time to run their business and the vendor has an accountable agency on the hook to deliver results in the required timeframe.
Partner with the right agency
An agency can quickly turn MDF from a curse into a blessing. If you’re a vendor thinking about how you can get more bang for your buck with your MDF allocations, it’s time to seriously consider engaging an integrated marketing agency.
Look for an agency with direct experience in managing MDF, who has existing vendor relationships, and understands MDF marketing guidelines and timeframes. Seek agencies with strong processes and systems who can reliably meet vendor deadlines, report results, file MDF claims, and secure reimbursement.
Outsource offers a unique channel marketing for vendors concierge service to help your channel partners take advantage of MDF funds.
