Having been around the horn as a martech vendor customer, seller, partner and employee, I know how vendor-partner relationships work.
At a high level, martech partner programs are created to help vendors expand their reach. The partners become an extension of the vendor sales team.
These programs also provide value to customers since partner companies lend additional credibility, experience and ancillary services and products (i.e., implementation, customization and third-party connectors).
The open secret
The vendor can compensate partners in various ways, including:
- Commission-based compensation.
- Revenue sharing.
- Lead generation.
- Co-op advertising funds.
- And more.
Commission-based compensation
The partner earns a percentage of the revenue from selling the vendor’s technology to their clients. The amount of commission can vary and is typically based on the size of the deal and the level of involvement the partner has in the sales process. In some instances, this can be very lucrative to the partner.
Revenue-sharing
The partner earns a portion of the recurring revenue from the customer over the contract’s life. This compensation structure incentivizes the partner to focus on customer retention and satisfaction, as the recurring revenue they earn is tied to the customer’s continued use of the technology.
Lead generation
Partners are compensated for providing the vendor with qualified leads that result in a sale. This can include providing contact information to arrange demos or meetings with potential customers.
Co-op advertising
This provides the partner with soft dollars that can be used for events, advertising, vendor conference fees and more.
6 practical tips for martech partner selection
When working with martech partners, you must ensure their recommended solution fits your specific needs rather than their financial gain. Clear communication is key here.
Ask questions about their motivations and process. Evaluate the technology and the partner’s approach to ensure it aligns with your needs and goals. (You know, adult conversations.)
I’m sure most of you practice safe martech vendor and partner interactions, but sharing some practical tips for choosing a martech partner can’t hurt.
1. Define your marketing objectives
Before you search for a martech partner, get your business, marketing, CX and technology goals in order. You must understand what you want to achieve with your martech.
Identifying your goals and objectives lets you determine what martech solutions you need and what you should look for in a partner.
2. Conduct a needs assessment
After you’ve identified your marketing objectives, conduct a needs assessment. Consider:
- Your current-state marketing infrastructure.
- The skills of your in-house marketing team.
- Your budget (set one and stick to it).
Dig deeper: How to unlock the power of your marketing technology
3. Evaluate potential partners
With a clear understanding of your needs, you can now evaluate potential martech partners. Look for a partner with a proven track record of delivering successful martech projects. Consider factors such as:
- Their experience level.
- The types of martech solutions they offer.
- Their willingness to customize their services to meet your specific needs.
4. Request references and case studies
Before deciding on a partner, ask for references and case studies from past clients. Happy or maybe not so happy, speak with current and former customers to better understand the partner’s ability to deliver successful martech projects.
Dig deeper: Martech is mainly about relationships
5. Meet with the partner
Once you’ve narrowed down your list of potential partners, schedule a meeting with each one. Discuss your needs and objectives in greater detail and determine whether the partner fits your business well. That includes asking the partner directly how the martech vendor compensates them.
6. Evaluate the partnership
Finally, after you’ve selected your martech partner, it’s essential to evaluate the partnership on an ongoing basis. Set KPIs to effectively measure the outcomes and assess the project’s success and the partnership’s value.
Checkpoints allow you to assess whether to continue working with the partner or if it’s time to look around. Partnerships, like any relationship, are not “set it and forget it.” They take effort and commitment.
Selecting the right martech partner
Investing in a martech partner is a crucial decision. It significantly impacts how your martech projects perform. Research your options thoroughly and select a partner that aligns with your needs and goals. The tips above will help you minimize risk, reduce exposure and maximize the chances of successful outcomes.
Dig deeper: Managing martech relationships: Partnerships and agility in marketing
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