07 - How to Build a Mutually & Equally Beneficial Partner Program

Paul Bird 00:05  

This is Partner Relationship Management: The Ultimate Channel Sales Podcast.

Welcome to another episode of the Ultimate Channel Sales Podcast. I'm your host, Paul Bird.

The keys to building any relationship where both parties benefit mutually and equally are transparency, commitment and trust. 

These key areas hold great importance in channel partnerships and can influence many of the areas of one’s channel strategy, such as determining a vendor’s partner retention efforts. 

So why do so many vendors have such a hard time implementing partner programs that really promote these concepts? 

These key concepts should be at the heart of every partner program and every activity in a partner program should lead back to helping flesh out one of these key areas.

They are the building blocks for a mutually and equally beneficial partner program. And how you can use them to build yours, is the discussion we’re about to have in this episode of the Ultimate Channel Sales Podcast.

Our guest today has been in channel-related roles for over 20 years. 

Her portfolio includes leading teams that have generated more than 100 million dollars in new revenue and successfully launched over 35 disruptive products, solutions and services.

In her first year of being VP of Global Channel Strategy and Operations at Entrust Datacard, the new channel recruitment strategy she introduced resulted in $28 million of new partner sales and 150 new partners.

And in her most recent role, she closed the 2nd & 3rd largest global commerce partnerships within the first 65 days. And, increased partner-influenced revenue growth by 172% year-over-year.

Today, she is the Head of Global Partnerships and Strategic Alliances at Digital River – a company that provides global seller services, including tax calculation and remittance, payment authorization, fraud prevention, regulatory compliance and logistics.

She’s here with us now to discuss: How to Build a Mutually & Equally Beneficial Partner Program. 

Please welcome Kathleen Philips. It's an absolute pleasure to have you on the show, Kathleen. Welcome. 

Kathleen Phillips 02:19

Thank you, Paul. Thanks for having me.

Paul Bird 02:21  

So maybe you can give us a little highlight of your background, your experience as a channel chief so far in your career.

Kathleen Phillips 02:28

Sure. I've spent the last several decades working for high-tech companies. Anywhere from a startup to companies that are multi, multi billion dollars in sales.

I've been very blessed. They've all been global companies. And I've had sales, marketing and partnership roles.

And my first job out of college, I worked for a company and the only route to market for us was partners. And so it really became part of my DNA and the fabric of every single piece of clothes I ever put on.

So I learned very quickly the huge gratification and benefit of working with somebody and helping them grow their business. And it's been just a dream of mine to be in that same position with the company I'm at now.

Paul Bird 03:10 

Well, I was actually going to qualify that last question because I did have a look at your LinkedIn profile and realized that, hold on, this is only a 40 minute show, so it could take a little longer to go through your whole background.

But what about Digital River, where you are now?

Kathleen Phillips 03:24

Yeah, Digital River is a global leader. We help brands that sell through e-commerce websites go into global markets very, very quickly. 

So we have over 28 years experience setting up all of the payment gateways, legal entities, the tax structures, the fraud prevention, all the compliance to help brands go into new global markets very, very quickly.

And I run their global partnership and strategic alliances business.

Paul Bird 03:46

Perfect. So when we look at this topic of how to build a mutually beneficial and really symbiotic partner program, where do you think it's best for people to start?

How do we show that commitment to the partner right from the get-go?

Kathleen Phillips 04:01

Yeah, and I love the word symbiotic because at the end of the day, it has to be a mutual investment, right? So if I make a big investment and my partner doesn't, then I'm going to be disappointed and vice versa, of course. 

I think one of the most important things is to have alignment. I need to understand how my partner makes money. I certainly hope that my partner wants to understand how I make money.

Then you move on to things like: what is my unique value inside of that partner, right? So how do I become very relevant inside of that partner?

I think another big piece of it is how do they win? So I need to really understand how the partner wins and how I can support that.

And then a couple other pieces are: you have to have agreement on what are you going to track, right? What measurable goals are we going to track together? And how do we achieve them? 

And if we're not going in the right direction, let's fail fast and let's change it. But let's agree upon what the goal is.

And so many times I think companies get all kind of wound up in: how do we recruit and enable? But we never, ever kind of have those mutual goals that really are around revenue.

Paul Bird 05:06

Absolutely. 

And you think this is right from the start? It's almost like putting together your business plan right from the get go when you're having somebody recruited into the program where you're launching your channel strategy.

Kathleen Phillips 05:17

Right. Yeah.

And the other big piece - so there's two buckets.

So, one, get the onboarding right so that you are in violent agreement on what we're going to do together as partners.

And then the other piece really is it's time to revenue. That's it. 

Paul Bird 05:29

Yeah. 

Kathleen Phillips 05:29

How do we shrink our time to revenue? And a big piece of that is training, right?

And it's wide and deep. It's not only the sales but it's customer service, it's their finance team, it's their executive team, it is their technical teams, it's their marketing teams.

And at the end of the day, we can do all different kinds of sales incentives. We can do different referral fees.

We have to figure out: how do we become relevant and how do we become a preferred partner inside of that community, inside of that partner? 

And I think there's two things that companies can do above and beyond any product or services, which is be very, very easy to do business with and then create exceptional experiences.

Everybody's products are good and most of them aren't like a massive improvement over somebody else's.

But I'll tell you what, every day of the week, if you're easy to do business with and you provide exceptional experiences for your partners, they're going to pick up the phone and talk to you all day long.

Paul Bird 06:28

That is something that I have preached my entire career, is just make it - be as easy as possible to do business with.

If you start putting hoops in front of people and making them start to jump through the process, they'll find somebody else.

Kathleen Phillips 06:40

Right.

Paul Bird 06:40

You mentioned a few things there so let's kind of unpack that.

One of the things you said was training and not just training. 

If I think of early on in my channel career, the training was really focused on the sales team and the tech team, right?

We want them to be able to represent the product in the market and go through the training.

When I did VMware, I went through my sales certification, my technical sales certification. Had to redo it every year.

But then you mentioned something else, to make sure that you have that training with alignment with customer success, with finance.

What do you think the best way to go about delivering that training is?

Do you open the door with sales first and then kind of land and expand through the partner organization? Or is there a different approach?

Kathleen Phillips 07:29

No, it's a great question.

I think one of the things that I learned early in my career is I don't want to get stuck by a gatekeeper, right?

And so the gatekeeper can either make or break the partnership.

And that's why you go back to the first thing which is agreed upon goals.

I think you start with the sales team and you start with the person who is your counterpart.

And early on, very early on in the relationship, you understand how their organization is structured and get agreement on who are the critical functional areas that we need to get in front of to help ensure their success. Because it's not - it's never just the sales team.

The other piece that we have had tremendous success with at Digital River is executive alignment. Really making sure that our executives are aligned with the executives at our strategic partners.

Paul Bird 08:15

No, that makes a lot of sense.

I mean, if you have that buy in right at the top level, then the tactical level, the sales and the technical side of things, they'll have their marching orders, that's for sure.

Kathleen Phillips 08:28

Right.

Paul Bird 08:28

And then the other piece you said was time to value, right?

And that is, really, time to revenue. Trying to make sure that, hey, if you have a channel partner, primarily they're going to be partnering with you so they can make additional revenue.

When you look at time to value, once you have them trained, what do you think some of the things that brands can be doing to either shorten that time to value or increase the impact that they have with their channel partners?

Kathleen Phillips 08:56

Yeah, I think it's a great question. 

I think, Paul, the premier thing is you have to have alignment with how that partner makes money and how do I make sure that whether it's co-marketing, whether it’s spiffs, whether it's bringing them leads, it's: how do you ensure their success?

And so the companies that I've worked for, where we've had the most explosive growth in our partner channel, they're marketing all day long to their customers.

But we also sat right beside them and we did our own marketing campaigns and then we threw those leads, those qualified leads to our partners.

So I think a lot of it has to do with the investment that the manufacturer is willing to make inside their partner community.

Paul Bird 09:37

Again, I couldn't agree more. We are in complete alignment.

I've always referred to the channel as the beast. And if you feed the beast, then the beast is happy, the channel's happy.

But if you're asking them just to exclusively go and do demand generation for you, then they're going to split their time on whatever product, service, solution that they're making the most money on.

But if you want my attention and you're putting leads in my inbox, every couple of days, then you know where my focus is going to be.

So I couldn't agree with you more on that demand generation for partners. I think it's absolutely great.

How about partner enablement?

We talk about making sure, because any channel partner is likely going to be representing multiple different vendors, not just you. They're not exclusive.

Is there something that we should be considering from an enablement perspective to make sure that partners are successful and representing you in the market in the right way?

Kathleen Phillips 10:38

Yeah, I could go on for 10 minutes on partner enablement, but I will give you one piece that I think has been phenomenally successful in the organizations that I've worked in.

And it really has to do with, if I'm going to go recruit a partner, nine times out of ten, 99 times out of 100, they already have products that may look similar to mine or services. 

And it may not be just one box. Maybe you have to bundle up three boxes to get the same box I bring.

But at the end of the day, they're not interested in taking partner revenue from partner A and shifting it to you unless you're going to make a heck of a lot more profit and grow their business faster.

But what we tended, always, to do is understand: who are the companies that they're representing today that look like us?

And then we go through a process where we literally say, here's how we kind of stack up. And guess what? Here's the big box. And really where we don't make sense for you guys. Here's where we can add incremental value.

And we're not trying to take and take all the revenue from the existing partners you have today. We're trying to figure out: how do we add incremental revenue to your business.

I think that's the most important because nobody wants to lift and shift unless you're going to give a heck of a lot more profit.

Paul Bird 11:46

For sure.

So you're basically looking at don't be everything to everyone. Try to see where it is, the greatest value you have within their organization and then focus squarely on that for enablement.

Kathleen Phillips 12:00

Right.

Yeah, so I mean, most partners have dozens of companies that they're working with, some of them have hundreds.

And all of a sudden if I'm the new kid on the block and I'm trying to create this relationship, I've got to be very memorable and I can't be everything to everybody.

The partners that pitch to us and they're everything to everybody. Our salespeople walk away and the next week they forgot what they did.

But if somebody comes in, they're laser focused. And I only deal with the Northeast, I deal with lifestyle brands and this is my focus.

Then guess what? I'm going to remember that partner.

Paul Bird 12:34

Absolutely.

And they will be your go-to expert when it comes to any questions you have to deal with. 

I'm still kind of focusing on the partner enablement because one of the things that I have seen in the last few years is this idea of giving people co-branded content, right?

So you can maintain control of your content while giving the partner the ability to personalize it to a degree.

Now, my background, I spent half my career working in the channel, the other half building channel.

But when I was in the channel, this really wasn't much of an option for us.

Do you think that over the last few years that this has now given certain companies that are doing it a competitive advantage?

Kathleen Phillips 13:15

Oh, absolutely.

I used to work for a company called Entrust Datacard, and this was seven, eight years ago.

And one of our weapons was that we set up a site where we had all of these assets, marketing assets. They were blogs, and they were material you could share on LinkedIn. It was videos, it was podcasts.

And we allowed our partners to then co-brand all of those assets. And so, to your point, we had the ability to be consistent in how our brand was being represented by our channel partners globally.

Paul Bird 13:47

And another piece that kind of caught my attention, I was kind of unpacking that little introduction.

But the concept of incentives, spiffs, rewards, that has been also a topic that's been pretty hot over the last couple of years.

But I can remember when I was walking the floors at CDW 15 years ago, everyone had a sheet of paper on their desk with the latest and greatest spiff.

Do you think that's evolved at all or do you think we're more towards let's go with laser focused rewards? Or do you still think that idea of hey, put my offering first, hit a certain target level and you're getting something in return?

Kathleen Phillips 14:30

Yeah, I think it's very partner specific.

So, what we see a lot in our industry is that partners will allow us to quote-unquote spiff their sales team but it's in the form of quota relief, right?

So we're not putting money in their pocket, but we're relieving their quota, which can be a big deal for partners.

Other partners will allow you to do contests, allow you to do loyalty programs, allow you to give their employees X amount of dollars for a lead or closing business.

But I think as opposed to trying to take one set of spiffs or incentives and only use that as your arsenal. I think you're much better off to talk with that partner to ask what's worked, what's worked in the past, right?

And what's interesting, is we've even found where it's not even the salespeople a lot of the times that we're spiffing. We're spiffing the professional services team. We're spiffing the sales engineers.

It's a completely different, I think, way of thinking versus, 10/15 years ago, you just figured out: how do you get that salesperson more money than your competitors to get them to push your product?

Paul Bird 15:35

Absolutely.

So now going beyond sales because it used to just be really focused on the sales team. I love the idea of going after services and support.

Now, when you think of incentivizing or driving specific behaviors through some kind of incentive, do you look at training? Is there other things that you could measure against that you could maybe incentivize?

Kathleen Phillips 16:00

Yeah, training is one of the number one pieces, right? And so without that, they're not going to have the base that they need to be successful.

And we don't have to even close the deal, right?

And so if one of our partners brings us into something, we're going to throw some money their way, if they allow us to. Just give us a chance to bring us to the table, right?

And then there's other programs where we go all the way through where we're giving partners $25,000 and they can use that to spiff their sales team, they can use it to increase their profits, they can use that to reduce their implementation costs.

So it's just all over.

We try to be really creative and try to figure out what's really going to move the needle for these partners.

How are we going to really gain their mindshare inside their organization?

Paul Bird 16:45

And 25K, I mean, that's kind of money that I used to see when it came to co-op marketing or, you know, market development funds.

How does the MDF or co-op marketing, how does that play into the mix as well?

Do you see that as more of an incentive to help people grow?  Or do you think that really is getting back to that driving time to value?

Kathleen Phillips 17:09

I think it's a little bit of both, to be honest with you.

I think that companies that really are good marketeers, they love those types of programs. And what they don't like is the chains, right?

Don't put some chains around my arms, let me market how I want to market. And then if I need to step in and help them or support them with different assets or personnel even, then we'll do that.

But I think that companies that are willing to take and very diligently figure out: what's the best way for us to partner together, to co-market together. Those are the best relationships. 

When you've got a company that's going to co-market with you and whether you're doing the funding of it, maybe they're doing some funding of it. It typically is both. 

That's a true partnership.

Paul Bird 17:52

Absolutely.

So one of the things that maybe isn't so tactical, but something that I think we need to keep our eye on is, maintaining that transparency and trust within the relationship.

So when you've got a partner that's been well-onboarded, you're deep within their organization, they are enabled, they're trained, they're motivated.

How do we keep the transparency and trust in place over the long-haul?

Kathleen Phillips 18:19

Yeah. My dad was one of my biggest mentors, and he taught me that your integrity is everything, right?

And when I'm out representing Digital River, if I do something that hurts the trust of my partner, it's not just my integrity. It's my company's integrity.

Paul Bird 18:37

For sure. 

Kathleen Phillips 18:38

It's being, not only what you said, which is transparent, but most individuals will shy away from those kinds of difficult conversations.

And so, let's say, we've got an existing customer, that both the partner and Digital River is working with and they're just not having the experience they need to. 

I'm going to jump on that call immediately. Get the right people on the team on the call to figure out, where is the disconnect? And nine times out of ten, whatever I thought initially was a disconnect, not even close, right?

And it's getting partners to realize that we're going to do everything possible to ensure your success with your clients. We'll be there the entire way for you.

And if we have to run, play umpire to help with a situation that's gotten sticky, we'll do that.

Paul Bird 19:25

Well, one of my mentors in my career, very much like you, but - well, my father's always been a mentor, but in my professional career, was, when it came to integrity that if you have it nothing else matters. And if you don't have it, nothing else matters.

So when I look at the management of the partner relationship there's two schools of thought.

One is to have a team of people managing the partners. And another school of thought is having a dedicated individual as your primary partner account manager.

Do you have an opinion on either or, which way is more effective?

Kathleen Phillips 20:03

Yeah, I think a combination, Paul, to be honest with you.

So there's one person that should own that relationship, but there's no way that they're going to have the bandwidth to be on every single marketing call, be on every single technical call, every single demo, every single customer call.

So what we've done at Digital River, is we've basically assembled a team of, we've got product, we've got channel marketing, we've got our sales organization, we've got our customer success organization, we've got what we call our partner enablement organization and an executive sponsor.

And they all sit around that business development person to ensure their success because there's no way they have the bandwidth.

If you had two partners, yes, you could probably be on all those calls, but none of us are that lucky to only have two partners to manage. We're managing a whole sea of partners at any given time.

Paul Bird 20:49

Oh, for sure.

And unless you're that lucky partner account manager, where you know their partner is massive and it dedicates all of their time to it.

But I think for most of us it is 5, 10, 15, 20 or more that we have to manage at any one given time.

So all of these strategies and tactics and goals that we're engaging the partners with.

What kind of tools do you think that people need to have in place so they can effectively manage the relationships and that they have the ability to to track and measure so that you can hold back to the metrics that you've established right at the beginning of the partnerships? Like what's in that toolkit?

Kathleen Phillips 21:32

Yeah, that's a great question.

So we use partner portals very extensively.

It's basically where we house all of our assets and each partner can see, if there's a particular ecosystem they play in, they can see all the assets that are not only specific to them, but to that ecosystem along with we have our quarterly business plan there.

And so on a monthly basis, we're meeting with that. Well, most of the time they're meeting with the partner every week if it's strategic. And sometimes multiple people in that partner community, in that particular partner on a weekly basis.

But meeting with them on a regular basis to make sure that we're moving the needle. And if something's not working, let's fail fast.

But we all agree upon those. And we use that one central location. It just makes it easier than Google Docs or sending Excel spreadsheets or emails.

And that's what we've done is we've really used our partner portal as our kind of bank of intelligence, ability to track our partner relationships successfully.

Paul Bird 22:32

So all of this effort that you and your team are putting in, what are some of the things that the actual channel partner themselves should be considering to make sure that they're contributing to the relationship as well?

This is a symbiotic relationship. So there has to be kind of a focus from that from the other side of the table.

Any suggestions on what you would expect from these channel partners to make sure that this is benefiting both parties?

Kathleen Phillips 22:58

Yeah, so I'd say, I go back to the 80/20 rule.

And so I would say 10% of our channel partners are our strategic partners, 20% are very good partners, and then 70% really are more opportunistic.

And so with our strategic partners, really, really expecting them to have marketing departments that are willing to make an investment so we can go to market together, we can co-brand, we can talk about wins, we can do blogs, we can do webinars.

If we do some type of testimonial or something we ask them to take those assets, and we ask them to put them on their websites, we ask them to share them with the social media.

So I think it's based on the partner level. 

So the strategic partners, we're looking for a mutual investment. And the other partners, we're going to manage and be more optimistic and we're not going to meet with them on a weekly basis and we're going to give them all the same assets and tools.

But we realize that really, where our focus needs to be is on our two top-level partners.

Paul Bird 23:58

Perfect and if you compare life without that partner portal as opposed to life with a partner portal, what kind of difference do you think it's made over the long-haul?

I mean, both of us have been in this industry long enough that we do remember that time where it was spreadsheets that was governing most of the partner engagement process.

But pre and post era, do you think that the gains are significant?

Kathleen Phillips 22:58

I think the gains are significant for a couple of reasons.

Number one is that you've got multiple people in the organization that are contributing to the assets on that partner portal, right? The last thing you want is to be stuck on somebody's Excel spreadsheet.

And so we have the ability to have this whole ecosystem of people at Digital River who support those partners.

It's not just the business development person, but it's the channel marketing, it's the sales, it's the customer success, it's the partner enablement, it's our solutions architects and our SAEs.

And so they all have access to what's going on with that particular partner, right?

And so I don't have to have a separate meeting of every single partner and all of those individuals. They all have access to the same information.

Paul Bird 25:10

Perfect.

And you've shared some really great nuggets with us today, some great advice across the experience of your career.

If people adopt your approach, this very focused symbiotic approach, what kind of gains do you think they would expect as opposed to more of a transitional way of, hey, sign up, join my partner program and now you're authorized to sell my product.

There's kind of the two different - you're very engaged as opposed to people that are less engaged.

What do you think the difference is when it comes down to the results?

Kathleen Phillips 25:44

I think the biggest difference is that people do business with people, right?

And so if you have a more generic approach, you never, ever create those personal relationships.

And if you think that your partners are going to be interested in building your business, you're going to be sorely disappointed.

You have to be interested in building their business.

And I think that's the biggest difference is that by having this laser-focused approach, we have those personal relationships. We have a team of people that at any given time can drop anything they're doing to ensure that partner's success and make sure that our relationship is continuing to grow.

And we're continuing to deliver on the agreed upon revenue goals that we have on a quarterly basis.

Paul Bird 26:27

Perfect.

So as we start to wrap things up, any other suggestions, recommendations or advice that you can give people that are maybe early on in their channel career or maybe they have a mature channel program and are looking for advice to get to the next level?

Any suggestions or thoughts on that?

Kathleen Phillips 26:47

Yeah, I mean, I think the most important piece really, Paul, this is going to sound kind of corny, but have humility, right?

Be somebody who is humble, be somebody who is gracious, be somebody who is genuinely interested in building your partner's business and be courageous, right? Stand up for your partner.

There's been times when I was like, I'm not really sure if I should do this, but I'm like, I'm going to because I know it's the right thing to do. And it may be an event for me, but I know it's the right thing to do.

So I think it's being the person that literally is by their side to ensure their success. I think that's what you need to do.

And I think that the other piece is, it's not a numbers game. It's not about how many partners you have. It's about the quality of the partners that you have.

I think just to remember that and there are individuals that think we should go sign up another ten partners in every single country in the world. 

Well, there's no way we don't have the bandwidth to manage that, right? And the cost would be insane. 

Paul Bird 27:43

For sure. 

Kathleen Phillips 27:44

Be focused, be strategic and be a person that a partner wants to do business with.

Paul Bird 27:49

Absolutely.

Well, that is some sage advice. We really appreciate it.

Thank you so much for joining us today and really hope that we can continue the conversation again in the future.

Kathleen Phillips 28:00

Thank you, Paul. It's my pleasure.

Paul Bird 28:06 

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