The Definitive Guide to External Social Collaboration and Indirect Channel Marketing

© Relayware, Inc. 2013 www.relayware.com Page 1 of 113
Collaborate beyond the enterprise
eBook from Relayware
The Definitive Guide to External Social Collaboration
and Indirect Channel Marketing
By Mike Morgan, CEO Relayware

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Contents
Introduction 5!
Why Sell Through an Indirect Channel? 6!
Challenges Posed by an Indirect Channel Model 6!
Knowledge is Power 7!
The Pareto Principle 7!
The Nature of the Relationship 9!
Evolution of the Channel into a Demand-Side Ecosystem 10!
Changing Behaviors 11!
Chapter 1: External Social Collaboration and Communication in Business 13!
Evolution in Communication 13!
The Rise of Social Technologies 17!
Chapter 2: Business Social Collaboration and Communication Technologies 21!
The Business Issue 21!
Ecosystem Social Collaboration: What is It? 22!
Ecosystem Social Collaboration: The Components 24!
The Benefits of Ecosystem Collaboration versus CRM and PRM 30!
Consequences of Misuse of Technology 34!
CRM and Ecosystem / External Collaboration System Co-existence 35!
Chapter 3: Selecting Your Ecosystem 37!
Go to Market Strategy 37!
The Importance of Good Data 38!
Chapter 4: Segmentation, Accreditation and Tiering 40!
Accreditation 40!
Social Segmentation 44!
Chapter 5: Indirect Channel Recruitment 46!
What’s in it for Me? 46!
Recruitment Campaign 47!
Recruitment Process 48!
Mediums 49!

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Targeted Campaigns 49!
On-Boarding 50!
Chapter 6: Enablement, Education and Development 53!
Market Making 53!
Fulfillment Error! Bookmark not defined.!
Chapter 7: Indirect Channel Motivation and Incentivization 57!
Being the Company of Choice 58!
Show Me the Money 60!
Being a Pleasure to Do Business With 62!
Chapter 8: Indirect Channel Collaboration 64!
Proven Methods 64!
Service and Support Collaboration 64!
Sales Collaboration 65!
Marketing Collaboration 70!
Collaboration Among the Ecosystem 72!
Chapter 9: Communication 74!
Communication Strategy 74!
Communication Objectives 76!
Selection and Segmentation of Receivers 76!
Medium 77!
Message 81!
Response 83!
Repetition and Frequency 84!
Chapter 10: Service & Support 85!
Channel Segmentation Versus Quality of Service 85!
Delivering High Quality Yet Cost-Effective Service and Support 86!
Purposeful Portals 86!
Mobile Apps 93!
Chapter 11: Performance Management and Optimization 96!
Introduction 96!
Definition 96!
Setting Performance Targets 97!

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Performance Measurement 98!
Balanced Scorecarding 99!
Balanced Scorecarding for Indirect Channels 100!
Purpose of Scorecarding for Indirect Channels 100!
Practical Applications of Indirect Channel Balanced Scorecarding 101!
Accreditation 102!
Channel Program Hierarchy 102!
Automating Indirect Channel Balanced Scorecarding 103!
Alternative Methods of Indirect Channel Balanced Scorecarding 104!
Optimizing and Rewarding Performance 106!
Developing a High Performance Channel 107!
Rewarding a High Performance Channel 108!
Summary 109!
Selection 109!
Segmentation and Accreditation 109!
Recruitment and On-boarding 109!
Development and Enablement 110!
Motivation and Incentivization 110!
Communication 111!
Collaboration 111!
Service and Support 111!
Performance Management & Optimization 112!
Additional Information 113!

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Introduction
Indirect sales account for more than 70% of global business. It was once thought that the
internet would drive intermediaries out of business as direct distance-selling with low
transactional costs rendered indirect channels obsolete. For some commodity sales where the
company’s brand was strong, this did come to pass. But otherwise, the internet and
ecommerce provided a low cost route to market for the very intermediaries that we once
thought would put out of business by it. In fact, the internet is largely responsible for an
explosive growth in indirect channels created specifically as “etailers” or for conventional
resellers; supplementing their offline business with an online channel to market of their own.
Amazon doesn’t write, produce or publish books. They’re an aggregator and an indirect
channel and have followed their success in books and physical-media music with the sale of
downloadable media and many other products. Most importantly, like many other indirect
channels before them, they now own the customer and consequently they are far more
powerful than any one of the vendors, content creators and publishers they represent – the tail
that wags many dogs!
Far from heralding the end of indirect channels as we thought it might back in the dotcom era,
the internet has in fact provided a global network for indirect sales and a platform for the
promotion of their added value. The internet became merely a conduit for marketing and
commerce for those channels willing and able to adapt. Once again, Amazon provides us
with a prime example as it has itself become a virtual marketplace for many thousands of
other indirect channels.
More recently, the advent of Cloud services seemed once again to ring the death knell for
indirect channels in the hi-tech industry. I have spoken with countless software industry
executives in recent years who have again predicted the demise of the software channel
because they simply cannot envisage a role for intermediaries in the marketing and
support of a service that is sold, delivered, managed and maintained by the company who
also produces it. After all, products sold as a service that are simple to buy and easy to own
suit an entirely direct go to market strategy. When more complex products are sold to
large corporate accounts, again, direct makes sense, so far, so good. But complex
products, direct selling and support and SMB’s don’t mix well. In every case throughout the
history of commerce, these circumstances call for indirect channels and what companies
must do is to develop a thorough understanding of the value chain, roles and
responsibilities, rules of engagement and resolve the new challenges posed by the new
business model. Such transitions from old to new business models have always
accelerated evolution and adaptation among indirect channel ecoystems while spawning
new ones.
Far from heralding
the end of indirect
channels as we
thought it might
back in the dotcom
era, the internet
has in fact
provided a global
network for indirect
sales and a
platform for the
promotion of their
added value.

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Why Sell Through an Indirect Channel?
So what’s so great about indirect selling and why do companies inevitably turn to an
indirect go to market model at some point? The simple answer is that most companies
have no choice if they want to keep on growing. Marketing and selling to customers and
then supporting them directly just doesn’t scale well and costs spiral out of control. Here
are the main reasons for companies choosing an indirect model:
Extending reach
• Whether you’re looking to expand into the next town, the next country or the next
continent, indirect channels give you the most immediate and lowest cost route to
market
• They provide feet on the street that know the local market and speak the local
language
Augmenting capability
• Indirect channels may just resell your products but it’s more likely that they add
additional value
• They may market, deploy and support your products
• They may sell other complementary products and services that make your
collective value proposition stronger than yours alone
Minimizing cost
• An indirect channel gives you instant sales, marketing and other resources in your
chosen market with no incorporation fees, no start-up costs and no need for
recruiting personnel
• What’s more, they’re cheap to run and your overhead is predictable because they
entail mainly point of sale discounts and modest support costs
Challenges Posed by an Indirect Channel Model
Ubiquitous, appealing and successful as indirect selling is, it brings with it inherent
management challenges for those companies who adopt an indirect go-to-market strategy.
If you sell direct, things are relatively straightforward. You own the sales resources, and you
control the message. When you introduce single or multi-tier indirect channel things start
to get complicated. Those sales and marketing resources don’t belong to you, most of the
time you don’t even know who they are. You don’t pay them and you don’t task them. And
you neither determine nor control the messages they deliver to your customers. Nor do you
directly benefit from the feedback your mutual customers provide.
Ubiquitous,
appealing and
successful as
indirect selling is, it
brings with it
inherent
management
challenges.

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Traditional Simplistic Interpretation of a Hybrid Channel Structure
Knowledge is Power
The question of knowledge and intimacy is critical. Direct selling success is fundamentally
based upon telling people what they need to know, telling them what to do and managing
them doing it. But if you don’t know who is doing your selling, don’t know how to
communicate with them and don’t know how to motivate them and influence their behavior
even if you did, you have a big problem.
Very often when we engage with a new customer, they scarcely have one named contact
per channel organization. Even fewer of these have valid contact information – email
address, social ID or telephone number appended to their contact data. If you don’t know
who’s out there selling or how to communicate with them, you can’t talk to them and if you
can’t talk to them, you can’t influence their behavior or effectively enable them to do what
you want them to do. And performance management is of course out of the question.
The Pareto Principle
This in turn generates the second problem – a cycle of increased investment (of time, effort
and resource) in and dependency upon a very small number or proportion of the indirect
channel base for the vast majority of a company’s revenue. Most companies surround
themselves with a hard-core of volume sellers – indirect channel organizations who
consistently sell the most. As the channel grows while channel management resources
continue to dwindle, channel management becomes increasingly difficult and we see the
Pareto principle taking effect:
Direct selling
success is
fundamentally
based upon telling
people what they
need to know,
telling them what
to do and
managing them
doing it.

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Another Indirect Channel Challenge – The Pareto Principle
The Pareto principle (also known as the 80–20 rule, the law of the vital few, and
the principle of factor sparsity) states that, for many events, roughly 80% of the effects
come from 20% of the causes.
This distribution is claimed to appear in several different aspects relevant to business
managers. For example:
• 80% of your profits come from 20% of your customers
• 80% of your complaints come from 20% of your customers
• 80% of your profits come from 20% of the time you spend
• 80% of your sales come from 20% of your products
• 80% of your direct sales are made by 20% of your direct sales staff
• 80% of your indirect sales are made by 20% of your indirect channels
In practice we regularly see over 50% of all indirect channel revenues coming from 5% or
less of the base. Shocked? Before you judge others, go and check your own sales data – I’ll
be equally shocked if your story is any better.
The Pareto effect typically worsens because more revenue generated by the fewest
number of accounts leads to greater consolidation in investment by the company in those
same accounts. These intermediaries typically offer limited opportunity for growth and yet
they demand the best pricing, the deepest discounts and the greatest amount of effort to
In practice we
regularly see over
50% of all indirect
channel revenues
coming from 5% or
less of the base.

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maintain. Without the means to cost effectively develop and monetize the potential that
exists within the remaining indirect channels, our customers often reach a growth “glass
ceiling” – a revenue threshold beyond which they cannot go with their top tier of
intermediaries – a point beyond which they cannot go without investing in systems, tools,
processes and best practices to exploit the latent potential that exists.
The Nature of the Relationship
The third challenge relates to the relationship lifecycle that exists between a company and
its indirect channels. Any sales and marketing professional is familiar with the customer
lifecycle – targeting, acquisition, nurturing and repurchase or resale. But the nature of a
company’s relationship with their indirect channel is infinitely more complex and difficult to
manage. This is because the objective is not merely to generate a sale by creating a desire
to buy; it is to create a need and desire to sell, market and support on behalf of the
company in question.
The Indirect Channel Lifecycle

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This is a process of winning hearts and minds and requires a sustained, programmatic
approach. Many of our customers mistakenly and unsuccessfully attempt to utilize social
CRM systems to try to automate the management of this lifecycle but the sales and
marketing automation capabilities they offer are wholly inadequate for the task.
Evolution of the Channel into a Demand-Side
Ecosystem
If the indirect channel model ever looked like the simplistic illustration earlier in this section,
it certainly does not resemble this today. Supply chains and value chains have evolved into
sophisticated ecosystems made up out of many companies and individuals each providing
products, services and knowledge to customers often acting independently but frequently
collaborating to deliver business solutions to the customer. Your product is typically only
one (small) part in such a solution. Where effective communication through the value chain
was once the primary challenge for companies and one that programs and PRM systems
solved in part, collaboration with ecosystems is now the number one challenge facing
businesses with indirect go to market strategies.
An Example of a Demand-Side Ecosystem
If the indirect
channel model
ever looked like the
simplistic
illustration earlier
in this section, it
certainly does not
resemble this
today.

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Changing Behaviors
Finally and very importantly is the significant behavioral shift that has taken place within the
target audience for this lifecycle management process. The advent of social networking
and the ubiquity of the software and technologies utilized to engage in social networking
have transformed the way in which people communicate and otherwise interact. Indeed
social media has become the communication medium of choice for the generation of
individuals now entering the workplace and is rapidly displacing email for everyone else.
Some interesting statistics:
• Social media, communities and blogs are the number one generator of internet
traffic
• Instant messaging, activity streams and push updates are replacing email
• Mobile devices will outnumber desktop/laptop computing devices 5:1 by 2015
• One to one communication is giving way to one / many to many communication
• Marketing communications are giving way to collaborative conversations
• Managed relationships are giving way facilitated communities
• Individuals are more inclined to be influenced by the opinions and expressed
consensus of fellow community members than by companies
• Opt-out is giving way to opt-in (Follow, Share, Like) for communication preference
setting
These are just a few of the manifestations of this change but our customers are really
struggling to adapt. Many are only just beginning to implement first-generation Partner
Relationship Management (PRM) technologies only to find that their limited collaboration
and communication capabilities are unable to address the needs of their audience or to
overcome the challenges outlines above. Social CRM and PRM technology fails to address
their needs because they enable only some aspects of the sales, marketing and program
automation needed. Enterprise collaboration tools are great for facilitating collaboration
but enable messaging, file and project-sharing inside a company not beyond it.
Let’s recap on some facts that conspire to create a pretty challenging environment:
• >96% of manufacturers sell through indirect channels to market
• They are almost entirely dependent upon loyalty and goodwill to drive indirect
revenue
• Indirect channel lifecycle is inherently complex to manage
• Communication to and throughout the indirect channel community is critical to
success
• Social paradigm and mobile technology are revolutionizing communication
The key to success
is to realize that
you are part of a
diverse community
of businesses and
individuals at the
heart of which is
your mutual
customer.

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• Indirect channel needs, expectations and behaviors are changing
• Social CRM, PRM and enterprise collaboration technology all individually fail to
provide a solution
With so many challenges, it would be easy and understandable if businesses gave up
selling indirectly altogether. But they can’t and consequently won’t. Instead most tirelessly
implement the same flawed strategies they have adopted for years or decades. To do
otherwise would require a fundamental change in the way they think about indirect
channels, some effort and a little cleverly applied investment.
But for those companies willing to apply themselves, the competitive advantage alone will
make it worthwhile. This eBook is the definitive guide to making it happen!
The key to success is to realize that you are part of a diverse community of businesses
and individuals at the heart of which is your mutual customer. Stop trying to manage your
indirect channels. You cannot and will not succeed. No-one ever has. Instead collaborate
and communicate with them like you’re on the same team, treat them as individuals rather
than as an amorphous mass then sit back and watch the revenue roll in.

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Chapter 1: External Social Collaboration and
Communication in Business
The practice of communication by written documents carried by an intermediary from one
person or place to another almost certainly dates back nearly to the invention of writing.
However, development of formal postal systems occurred much later. The first
documented use of an organized courier service for the diffusion of written documents is in
Egypt, where Pharaohs used couriers for the dissemination of their decrees in the territory
of the State (2400 BC).
Evolution in Communication
Apart from the introduction of the postage stamp and intercontinental postage services,
nothing much changed until 1837 with the invention of the telegraph allowing messages to
be conveyed long distances without the need for physical media. In 1876 the telephone
was born followed by the radio in 1910. Since then, the rate of technological innovation in
communications has accelerated fuelled by the human desire to interact with each other in
ever more immediate and intimate ways.
Rate of Adoption of Communication Technology – Time to 50 Million Users
As new
technologies and
mediums for
communication
become available,
so the access to
them and the rate
of adoption
increases at an
exponential rate.

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As new technologies and mediums for communication become available, so the access to
them and the rate of adoption increases at an exponential rate. Contrast the time taken for
radio to reach its first 50 million users compared to Twitter. Of course access to high speed
internet has caused this acceleration and with the exception of cellular telephony, all
contemporary communications are dependent upon it.
Changing Demographic of Social Technology Usage as % of Total
If we consider the most recent additions to the range of communication mediums available
to us; Instant Messaging, Facebook, Twitter, YouTube, Skype, blogging, wiki’s it’s clear that
they can all be described as social communication channels. They inherently facilitate
social or “many-to-many” communication as opposed to older forms of communication.
Early adoption was among the younger members of society but the demographic of social
media users has changed dramatically in the last few years.
Those of us over the age of 30 who do most of our communicating for business or during
the working day experienced our communication revolution in the 90’s and 00’s with the
advent of cell phones and email and we’ve been stubbornly hanging onto them ever since.
Look how we have engineered our cell phones to become perfect tools for sending and
receiving emails! But email is as its name suggests little more than a means of sending one-
to-one or on-to-few correspondence. It is not social and it’s certainly not collaborative.
Email has also long been hijacked by the spammers forcing us to adopt ever more creative
ways of filtering our daily communication. Regardless, we business people have become
eMail is not social
and it’s certainly
not collaborative.
Regardless, we
have become
slaves to our eMail.

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slaves to our email – the first application we open in the morning and the last we close at
night and the one we spend endless hours poring over all day.
This has prompted many individuals and some companies to envision a world in which
email is eradicated in favor of social communication and productivity is enhanced as a
consequence. Take a look at these great examples taken from the media:
Luis Suarez of IBM Abandons eMail

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Atos Phases Out eMail
Communications are Shifting from Email and IM to Social
After two decades
of inexorable
increases in global
email usage, email
is finally beginning
its unavoidable
demise.

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After two decades of inexorable increases in global email usage, email is finally beginning
its unavoidable demise. This decline in popularity will accelerate as a new generation
enters the workplace. And from personal experience, I can tell you that this new generation
simply don’t understand the purpose or merit of email and have no interest in using it.
The Rise of Social Technologies
Social technology adoption among consumers still far outpaces social technology
adoption among employees but this is because business themselves have been slower to
adopt them. Until recently, many executives viewed social technologies with suspicion.
They focused on their domestic usage and feared that they would cause employees to
waste time rather than improve their productivity. But after a slow start, software companies
including Jive Software, Yammer (now owned by Microsoft) and Salesforce.com with
Chatter have made significant inroads into large enterprises since around 2009.
Business Adoption of Social Technologies Lags Behind Consumer
Here are some more interesting statistics in rapid succession. The hi-tech and telecoms
industries lead the way in social technology adoption and they are showing the same
enthusiasm for social technologies as they did for resource planning and relationship
management technologies in the last decade or so. Other industries lag far behind.
After a slow start,
software
companies
including Jive
Software, Yammer
(now owned by
Microsoft) and
Salesforce.com
with Chatter have
made significant
inroads into large
enterprises since
around 2009.

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% of Companies By Sector Using Web 2.0 Social Tools
But this is understandable for a number of reasons. Firstly looking at the mix of employee
types and job roles we can see that sales and marketing, IT and R&D combined with
management, technical and frontline staff, are the biggest users.
Web 2.0 Social Tools Used by Many Job Roles and Departments

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And secondly, there is a dependency on how well networked those employees are and this
again comes down largely to the industry and the nature of the workforce.
How Well Companies Benefit from Social Technologies Depends Upon
How “Networked” They Are
Given these statistics, it is easy to see why in a recent report, McKinsey concluded that
among commercial enterprises those engaged in software, internet and professional
services markets had both the most to gain by using social technologies and that they
would find it extremely easy to capture the added value potential offered by them.
Value Potential and Ease of Capture Through Social Technologies by Sector
McKinsey
concluded that
among
commercial
enterprises those
engaged in
software, internet
and professional
services markets
had the most to
gain by using
social
technologies.

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The largest source of value that they identified is using social technologies for interactions
within and between enterprises. McKinsey went on to estimate that social technologies,
when accompanied by significant management, process and cultural transformation could
improve the productivity of interaction workers by 20-25%. And we’re only just beginning
this journey.
Let us consider the importance of this conclusion for the reader of this book. You are
probably reading this because you market, sell and support your products through an
ecosystem of interaction workers – people whose work requires complex interactions with
other people, yet because they work independently from your company their work also
requires independent judgment. This group includes sales people, marketers, technical
personnel managers and a range of other knowledge workers.
Imagine the impact on your enterprise of implementing social and collaborative
technologies that could complement or replace outdated communication technologies
and experiencing a 20-25% improvement in productivity.
Improved Collaboration and Communication Through Social Technology
Between Interaction Workers Could Improve Productivity by Up to 25%
Now imagine the impact of extending that productivity gain beyond the enterprise; to each
and every member of your demand-side ecosystem. And imagine the impact upon those
individuals of experiencing these productivity gains when working only with those
business partners who help facilitate this transformation; namely those employing business
social collaboration and communication technologies.
The largest source
of value that
McKinsey
identified is using
social
technologies for
interactions within
and between
enterprises.

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Chapter 2: Business Social Collaboration and
Communication Technologies
The Business Issue
It is often said that the cost of new customer acquisition is five times the cost of customer
retention. Yet many companies have yet to benefit from these economies. More significant
are the multiples generated by repeat purchases from retained customers and these come
as a consequence of long term customer satisfaction. This in turn comes from a deeper
understanding of each customer, their individual business challenges and proposing
solutions for those challenges rather than a "one size fits all" approach.
These principles are as relevant for the businesses that make up a company’s demand-side
ecosystem as they are for customers. This is because the majority of businesses today are
more dependent upon the sales and consequently the revenues generated by such entities
as indirect sales channels than they are upon the revenues generated directly by their own
resources. The key to success then, in part at least, is the successful “management” not
only of customer relationships but also of indirect channel relationships.
In the quest for high levels of customer retention and the generation of on-going repeat
business many companies have introduced Customer Relationship Management software
systems and, often inappropriately, these have been employed to also manage
relationships with indirect channels. But unless the principles of CRM and what has come
to be known as Partner Relationship Management (PRM) were adopted enterprise-wide,
operationally, collaboratively and culturally, such software systems often achieved neither
their potential nor the company’s business goals.
Since the advent of enterprise social and collaboration strategy and associated systems at
the turn of the last decade, business focus has turned from CRM to Social CRM and from
“relationship management” to social collaboration. The principal behind this is that social
and collaborative engagement is ultimately deemed more productive than the traditional
management of transactional business relationships. Indeed in the recent McKinsey Global
Institute report “The Social Economy: Unlocking Value and Productivity through Social
Technologies”, MGI concluded that businesses could realize a 25% productivity gain
through the adoption of social and collaborative strategies and technologies.
McKinsey define social technologies as digital technologies used by people to interact
socially and together to create, enhance and exchange content Social technologies
distinguish themselves through the following three characteristics:
1. They are enabled by information technology.
2. They provide distributed rights to create, add and/or modify content and
communications.
Business focus has
turned from CRM
to Social CRM and
from “relationship
management” to
social
collaboration.

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3. They enable distributed access to consume content and communications.
Collaborative technologies are more loosely defined but again appear to share three
common characteristics:
1. They are enabled by information technology.
2. They help facilitate action-oriented teams working together over geographic
distances by providing tools that aid communication, collaboration and the process
of problem solving and achieving a common goal.
3. They may support project management functions, such as task assignments, time-
managing deadlines, and shared calendars.
The juxtaposition of social and collaboration technology is clearly well-suited to the
application of enabling individuals separated by geographic distance to collaborate in the
shared goals of a supply- and demand-side ecosystem. The goals of the latter, which we
shall focus on in this document being namely marketing to, selling to and providing service
and support to customers.
We put forward the case then that by evolving existing Customer and Partner Relationship
Management strategies and technologies into one’s in which social collaboration is
central, businesses can help to achieve long-term customer and channel partner
satisfaction, ensure repeat purchases, improve customer and partner relationships,
increase loyalty, decrease customer and partner turnover, decrease marketing costs
(associated with customer or partner acquisition), increase sales revenue, and thereby
increase profit margins. This document sets out to define the components of such a
strategy and identify the technologies available to implement it.
Ecosystem Social Collaboration: What is It?
Ecosystem social collaboration is a system of methodologies, strategies, software, and
web-based capabilities that help an enterprise to facilitate and engage in collaboration with
and among the ecosystem of companies and individuals that engages in both supply and
demand generation and fulfilment. It is the collection and distribution of all associated data
to all areas of your business and the socialization of data among constituents of the
ecosystem. The general purpose of such a business strategy is to enable your organization
to better leverage your ecosystem through the introduction of reliable systems, processes
and procedures for collaboration and collaborative communication.
Enable your
organization to
better leverage
your ecosystem
through the
introduction of
reliable systems,
processes and
procedures for
collaboration and
collaborative
communication.

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Social Technologies
In today's competitive business environment, a successful collaboration strategy cannot
be implemented by simply installing and integrating a software package designed to
support CRM, PRM, Marketing Automation (MA), Enterprise Collaboration (EC) processes
or indeed any combination of social technologies. A holistic approach to collaboration is
vital for an effective and efficient collaboration strategy. This approach includes training of
employees, a modification of business processes based on the needs of employees,
customers, suppliers and indirect channels to market and an adoption of relevant IT
systems and/or usage of IT services that enable the organization or company to follow its
collaboration strategy.
We use the terms “collaboration” and “social collaboration” here to describe the whole
business strategy and ethos (or lack of one) oriented on ecosystem needs where the
company itself is one constituent in the ecosystem rather than as a description of a
software system although we will consider those in due course. To be effective,
collaborative engagements need to be facilitated end-to-end across the entire ecosystem.
Successful implementers of an ecosystem collaboration strategy:
• Identify and understand ecosystem success factors
• Create an ecosystem-centric culture
• Adopt ecosystem-based KPI’s
• Develop end-to-end processes to collaborate with and foster collaboration among
constituents in the ecosystem
A successful
collaboration
strategy cannot be
implemented by
simply installing a
software package.

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• Utilize integrated systems to enhance ecosystem collaboration to best suit their
needs
• Share information, tools and resources with ecosystem members
• Engage in and facilitate social and collaborative discussions with and among your
ecosystem
• Monitor and analyze all aspects of ecosystem collaboration
Ecosystem collaboration attempts to integrate and automate the various demand-side
processes within a company and expose them to the external ecosystem to facilitate
collaboration and communication with those processes and the individuals responsible for
them.
Ecosystem Social Collaboration: The Components
There are five components of a strategy:
1. Operational Collaboration - automation of collaborative marketing, sales and service
business processes and engagements
2. Community Collaboration – facilitation of peer to peer and workgroup collaboration
3. Multi-Channel Communication – facilitating collaborative discussions with and
throughout the ecosystem
4. Analytical Collaboration - support to analyze ecosystem behavior, implementing
business intelligence-like technology
5. Cultural Collaboration – transformation your company culture into a collaborative
culture
1. Operational Collaboration
Operational Collaboration is the transformation of so-called "front office" business
processes, which include all aspects of ecosystem contact (sales, marketing, learning and
service) into collaborative engagements. This involves a shift from linear “cascaded”
business processes “downstream” to the facilitation of team working between two or
more companies or individuals and the collaboration on shared tasks.
Operational collaboration provides the following benefits:
• Facilitates personalized, efficient and collegiate engagement
• Enables a 360-degree view of members of your ecosystem and the focus of
collaboration (e.g. customer, project, support ticket) while you are collaborating
with them
• Allows members of the ecosystem to interact and collaborate autonomously
Operational
Collaboration is
the transformation
of so-called "front
office" business
processes, which
include all aspects
of ecosystem into
collaborative
engagements.

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• Everyone in your organization from sales people to service personnel can access
complete history of all ecosystem interaction regardless of the touch point
The operational part of ecosystem collaboration typically involves four general areas of
business:
Sales Collaboration
Sales collaboration should encompass the most critical sales and sales force
management functions carried out by your direct sales force (and automated by CRM)
but in this case now extended to address these for your entire ecosystem. These functions
include account management, contact management, quote management, lead
management, pipeline management, forecasting, sales administration, keeping track of
customer preferences, buying habits, and demographics, as well as performance. Just as
Sales Force Automation (SFA) tools are designed to improve field sales productivity,
ecosystem sales collaboration tools are designed to improve ecosystem sales
productivity. Key components of sales collaboration are the ability to facilitate joint
management of sales processes with ecosystem members using web, social and mobile
tools and tight integration with CRM, product catalogues and pricing.
Marketing Collaboration
Marketing collaboration enables the sharing of information about the business
environment, including competitors, industry trends, and macro-environmental
variables. It is the execution side of joint-campaign management, demand generation
and lead management. The intent of marketing collaboration applications is to improve
marketing campaign efficiencies and effectiveness across the ecosystem. Conventional
Marketing Automation (MA) applications on the other hand are solely focused on
managing these for the company alone.

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Collaborative and Cooperative Learning
Learning collaboration and cooperation enables the transfer of knowledge between the
source and individuals within the ecosystem that is specific to the role the individual
performs on behalf of the company or their employer. A transfer of knowledge among
ecosystem members may also be facilitated. The underlying premise of collaborative
learning is based upon consensus building through cooperation among the participants.
Cooperative learning is defined by a set of processes which help people interact together
in order to accomplish a specific goal or develop an end product which is usually content
specific. It is more directive than a collaborative approach and is best suited to guided
learning.
The knowledge transfer or training may take various forms ranging from sales or
technical skills to product, market or customer-specific information. It may be ad-hoc or
structured in personal “certification” schemes or accretive organization-level
“accreditation” programs for which tests must be taken and compliance assured. The
intent of learning collaboration applications is to improve personal and organizational
knowledge, skills and expertise and so increase effectiveness of resources across the
ecosystem. Conventional Learning Management Systems (LMS) on the other hand are
solely focused on managing these for the company’s internal resources alone.
Service and Support Collaboration
Conventional Customer Service and Support (CSS) applications automate service
requests, complaints, product returns, and information requests leveraging shared
customer information. The assumption here is that customer support interactions are
owned by the company. In practice, most service interactions are handled by external
members of the ecosystem and the company typically becomes involved with
escalations. Service and support collaboration encompasses the shared responsibility
for providing customer service and support and provides the means for joint
management of service and support processes with ecosystem members using web,
social and mobile tools and tight integration with CSS systems.
Widely available CRM and PRM software systems are often known as "front office
solutions." This is because they deal directly with the customer or sales “partner”. Their
purpose is to automate operational tasks and processes and their functions can be
broken down in a similar way as we have done here. But they cannot be considered
“collaborative” solutions for the following reasons:
• CRM systems encompass SFA and to some extent MA but they are strictly focused
on processes associated with the customer which are typically transactional and
involve little or no interaction.
• PRM systems primarily address marketing program automation e.g. opportunity
management, incentives, rebate programs etc. and while some degree of web-
based interaction takes place through “partner portals” but do so while utilizing
The operational
part of ecosystem
collaboration
typically involves
sales and
marketing
collaboration,
collaborative and
co-operative
learning and
service and
support
collaboration.

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conventional linear, downstream communication between no more than two
parties. Few if any processes can be deemed truly collaborative.
2. Community Collaboration
While operational collaboration largely deals with processes and program collaboration,
community collaboration requires the company to facilitate collaborative dialogue and
engagements between it and the ecosystem and among the members of the ecosystem.
This is achieved through the provision of online community and group networking and
discussion tools through which individuals who share common roles, experience, skills
and interests can interact, share knowledge, information, files and documents and
engage in collaborative conversations.
Through the integration of portals, social networks, instant messaging and mobile apps,
community collaboration tools ecosystem collaboration allows members to interact and
communicate using the widest variety of mediums.
3. Multi-Channel Collaborative Communication
Ecosystem collaboration facilitates interactions through all channels (personal, letter,
phone, web, e-mail, social and mobile) and through these mediums supports co-
ordination of employee teams and ecosystem members. It is a solution that brings
people, processes and data together so companies can work together to better serve
and retain their customers. The data/activities can be structured, unstructured, person-
to-person, group-to-group, community-to-community, conversational, and/or
transactional in nature but always interactive and collaborative.
Collaborative communication provides the following benefits:
• Enables efficient productive interactions across all communication channels to,
through and within the ecosystem
• Enables autonomous, online collaboration to reduce customer service costs
• Integrates offline communication channels enabling broadest possible monitored,
tracked and recorded interaction
• Enables 24x7 collaboration regardless of location
• Ensures that communication and collaboration takes place through a medium of
the participant’s choice
• Dramatically improves success rates
Community
collaboration
requires the
company to
facilitate
collaborative
dialogue and
engagements
between it and the
ecosystem and
among the
members of the
ecosystem.

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4. Analytical Collaboration
In analytical collaboration, data gathered within operational collaboration and/or other
sources are analyzed to segment ecosystem communities according to profile or
behavior or to identify potential to enhance peer-to-peer, workgroup or community
collaboration. Ecosystem analysis typically can lead to more effective interaction and
more targeted campaigns to increase skills, shared knowledge and mindshare.
Examples of campaigns directed towards ecosystem members are:
• Selection and segmentation – profiling and separating the ecosystem into multiple
overlapping groups with common attributes or behaviors
• Recruitment and onboarding – acquiring new companies or individuals for the
ecosystem and nurturing them so that they are productive
• Training and enablement – developing skills and instilling knowledge within
ecosystem members to enable them to be more effective
• Motivation and incentivization – providing tactical and accretive inducements to
improve performance
• Performance management – setting and measuring attainment against joint targets
Analysis typically covers but is not limited to:
• Decision support through dashboards, reporting, metrics, performance etc.
• Predictive modeling of ecosystem attributes
• Strategy and research
• Analysis of data may relate to one or more of the following analyses:
• Campaign management and analysis
• Communication channel optimization
• Contact optimization
• Recruitment / reactivation / retention
• Segmentation
• Satisfaction and success measurement / increase
• Sales coverage optimization
• Marketing coverage optimization
• Financial forecasting
• Pricing optimization
• Product development
• Program evaluation / optimization
• Business process optimization
• Risk assessment and management

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5. Cultural Collaboration
Cultural collaboration aligns the culture of the company with the aim of achieving holistic
collaboration internally and externally with the ecosystem. Cultural collaboration can be
attained by:
• Identifying and understanding ecosystem success factors
• Creating an ecosystem-centric culture
• Adopting ecosystem-based KPI’s
• Developing end-to-end processes to collaborate with and foster collaboration
among constituents in the ecosystem
• Utilizing integrated systems to enhance ecosystem collaboration to best suit their
needs
• Sharing information, tools and resources with ecosystem members
• Engaging in and facilitating social and collaborative discussions with and among
your ecosystem
• Monitoring and analyzing all aspects of ecosystem collaboration
Few software systems deliver to their full potential. This is partly because most fail to offer
a complete end to end solution, addressing the needs of the users. But failure can also be
attributed to a lack of cultural transformation in line with basic principles. CRM and PRM
are prime examples and when they fail, they often do so because company executives
have failed to make the cultural changes necessary to ensure success.
Enterprise collaboration is the subject of much attention (as well as investment) from
company executives right now not least because it is highly acclaimed for its impact on
productivity and efficiency. As company cultures evolve and collaboration gains its
rightful place in corporate “DNA”, so the criticality of expanding the reach of
collaboration beyond the enterprise will grow.
Cultural
collaboration
aligns the culture
of the company
with the aim of
achieving holistic
collaboration
internally and
externally with the
ecosystem.

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The Benefits of Ecosystem Collaboration versus CRM
and PRM
Ecosystem collaboration, in its broadest sense, means facilitating collaboration with and
between members of a business ecosystem. A good collaboration strategy will allow a
business to target, recruit, onboard, train and develop, motivate and drive improved
performance with every constituent within the ecosystem while enabling multi-channel
communication to and through every device and medium available.
Specific benefits at every stage of the relationship lifecycle include:
Selection and Segmentation
It is crucial to build an ecosystem that addresses the needs of your customers. One must
therefore define the nature of the ecosystem by aligning it with your go to market strategy:
• Geography – what regions, countries, states, cities etc. does your ecosystem need
to cover and what degree of coverage is required in terms of capabilities to service
the markets there?
• Horizontal Markets – what type and size of organization, knowledge and skills are
required to address the large, medium and small business customers or consumers
you wish to reach?
• Vertical Markets – what vertical market expertise will you need to service the
customers therein?
• Products – what product knowledge, sales, marketing and technical skills will you
need relating to your own products and complementary products from other
suppliers?
• Value Proposition – what will your joint value proposition be to the customer?
Data can be sourced from a wide variety of sources to load into your system before
profiling and segmenting your base, building coverage maps and identifying gaps in your
existing ecosystem.
CRM and PRM systems can store the data and provide reporting capabilities but few will
afford the richness of capabilities for balanced score-carding and detailed profile-matching
necessary.
Ensuring that your ecosystem is selected according to the needs of your go to market
strategy and your customer needs results in optimized market coverage and customer
satisfaction.
Enterprise
collaboration is the
subject of much
attention and
investment
because it is
acclaimed for its
impact on
productivity and
efficiency.

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Recruitment and On-boarding
When engaging in targeted recruitment to your selected and segmented lists, data is of
paramount importance. This includes acquired knowledge about the individuals as well as
the companies that make up your ecosystem. When it comes to the act of recruitment, any
CRM or PRM system can manage a simple outbound recruitment campaign if it has contact
names and a medium for delivery. But simple as it is to do; running an email campaign
alone will severely limit your chances of success. Firstly, any outbound campaign must
feature multi-channel and multi-media delivery. It must include direct contact by telephone,
social networking, instant messaging and it must reach the recipients on and through any
medium or device they choose to use.
There must be a conscious act that the recipient must undertake to establish the
relationship. This act may range from merely “Following” your communications through to
downloading your mobile app and signing in or formally registering to join your community
program and possibly even signing up to your commercial terms. All of these things require
a web, social and / or mobile presence and some require an automated registration
process hosted on a secure portal or mobile app feeding into an approval process and the
automated distribution of security credentials. Here we have already gone far beyond the
scope of CRM or PRM but it is in the next crucial stage of the process that a truly
collaborative methodology and engagement is essential. The act of registration is merely
the first step. What must follow is an extended on-boarding campaign (similar to a lead
nurturing campaigns as supported by MA systems) in order to set the partner on the path
to development. This campaign requires the production and delivery of time or event-
triggered on-boarding communications. Once again, these must take many forms and
utilize multiple communication channels and they must be personalized and profile-
sensitive. Their purpose is to improve engagement and minimize early churn of new
recruits.
Recruitment can also be aided and your campaign’s reach extended through viral
communications, social re-communication, community interaction and simple mobile and
web tools like invite-a-friend drawing on personal contact data on the device.
Ensuring that your ecosystem is recruited effectively in accordance with your go to market
strategy and then nurtured through the formative stages of the relationship ensures higher
levels of retention and far higher levels of engagement in later phases of the lifecycle.
Training and Enablement
No company would deploy a new member of staff into a sales, marketing or support role
without providing proper structured and role-specific training, yet most companies expect
their ecosystems to perform complex tasks with little or no formal education. Indeed after
recruiting a new member, there usually follows an awkward silence while both parties wait
for the other to deliver. Providing adequate knowledge and tools for their ecosystem is
Ensuring that your
ecosystem is
selected according
to the needs of
your go to market
strategy and your
customer needs
results in optimized
market coverage
and customer
satisfaction.

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every company’s responsibility and when doing so is facilitated through simple email
messages it is well within the capabilities of a CRM or PRM system. However when it comes
to delivering training curriculum management, content creation, delivery, testing and
certification, most organizations will look to a commercially available learning management
system (LMS). However, these applications are typically geared to employee training and,
on the whole, perform poorly when managing the complex processes associated with an
ecosystem learning program. With the right technology, interactive training can be
delivered online or via a mobile device to ecosystem members at the appropriate time to
suit the stage in the development of the relationship and their personal profile and at a
convenient time to suit their needs. This incorporates everything from simple time or event-
triggered and context-sensitive multi-media updates or refreshers through to sophisticated
multi-tier, curriculum-based certification programs. In the case of the latter, results can be
automatically collated to determine organization-level accreditation which in turn will lead
to further structured learning for the individual.
A well trained ecosystem is inherently more effective and delivers significantly higher levels
of customer satisfaction.
Motivation and Incentivization
Many companies outsource loyalty or incentive program management simply because
they are too complex to manage and too time consuming to administer. Most are based on
the simple premise that sales are rewarded with points, prizes or money. Most are
unsuccessful because they usually only target those individuals who are in a sales role and
who are already actively engaged in selling on behalf of the company or else they reward
the company for hitting targets that were often predetermined to be easily achieved. As a
consequence, they often simply reward people and companies for sales that would have
been won regardless.
Collaborative motivation and incentivization is focused on rewarding individuals for
performing tasks, achieving objectives or otherwise making a contribution to overall
ecosystem effectiveness and its goals cannot be achieved through the use of CRM or PRM
systems. The practice monitors, recognizes and records all interactions with the members
and represents a form of gameification. Just a few examples of activities that should and
could qualify for rewards are:
• Registration
• Profile enhancement
• Downloading an using a mobile app
• Portal visits and social tagging of pages
• Social interaction; Likes, Follows, Shares, Comments
• Subscription to authors and communication topics
A well trained
ecosystem is
inherently more
effective and
delivers
significantly higher
levels of customer
satisfaction.

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• Reading emails
• Interaction with and contribution to community and group discussions
• Training participation and certification achievement
• Watching videos
• Downloading documents
• Submitting joint business plans
• Lead acceptance, updates and closure
• Deal registration, updates and closure
• Launching joint marketing campaigns
• Achieving ROI targets for marketing activities
• Compliance
• Completing service calls and installations
• Meeting first-time fix rates
Of course making sales is still important but collaborative ecosystem motivation is focused
on rewarding everyone for making a contribution no matter how small to collective
success. Rewards themselves need not be prizes or money. The application of basic
gameification principles can ensure that the reward of merely monitoring your
achievements and being able to share them with others can be enough to motivate
otherwise cynical individuals to participate.
Well-motivated and incentivized people perform better. And a more highly performing
ecosystem delivers improved results and heightened levels of customer satisfaction.

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Sales, Marketing, Service and Support Collaboration
Just as companies need to monitor their performance and the performance of their staff
against defined KPI’s, it is essential for them to pay close attention to the performance of
individuals within their external ecosystem and of the ecosystem as a whole. While sales
analysis and reporting is a common feature of any CRM and PRM system, there any many
other metrics used to measure ecosystem performance beyond merely revenue delivered
including ecosystem engagement (examples of which are detailed in an earlier section of
this document). While a CRM or PRM system requires integration with various external
systems to import critical data for a balanced assessment of performance, an ecosystem
collaboration solution captures not only all of the data associated with the constituents
within your ecosystem but it also captures information about each and every interaction
with and between them and with your mutual customers as well because all of the
associated apps and communications channels reside on or interact with the same
platform.
Ecosystem performance cannot be effectively measured merely through tracking sales
performance. Instead companies have to establish a broad set of performance KPI’s linked
to every activity and every interaction they have with their ecosystem and that takes place
within it. By doing this they can take a holistic and objective approach to performance
management.
Consequences of Misuse of Technology
Companies who use CRM and MA systems to engage in ecosystem collaboration have an
extremely poor record of success. These are customer-centric sales and marketing tools
and wholly unsuited to the task. A good compromise can be achieved by deploying a PRM
system but this technology has failed to keep up with the times and the changes to
collaboration and communication that the last decade has brought.
Currently, only a small portion of companies have adopted a PRM strategy or employed a
software system to execute it. Indeed most are still driving their business as they always
have done by using spreadsheets and manpower. Minorities have chosen to use an
incumbent CRM system to support basic contact, lead and opportunity management, but
that is as far as it goes. Hence, the results are almost always disappointing and the
business doesn’t reap the benefits from the tools.
Ecosystem collaboration solutions effectively replace PRM systems as they offer all of their
functionality but additionally they fulfill contemporary needs for peer-to-peer and
community collaboration and multi-channel communication incorporating social,
messaging and mobile thereby rendering PRM obsolete.
Operational
ecosystem
collaboration
displaces PRM
and channel
programs and
takes both the
depth and breadth
and interaction to
an entirely new
level improving
efficiency and
operational
effectiveness for all
members of the
ecosystem.

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CRM and Ecosystem / External Collaboration System
Co-existence
Any company that has made an investment in a CRM system is unlikely to want to discard it
and the investment it represents in order to deploy a system specifically designed for
facilitating collaboration beyond the enterprise. So the question “can we link our CRM
system with a complementary system?” is often asked and the answer is “yes!” Integrating
CRM and external collaboration systems allows organizations to bring together all parties
in the ecosystem including the customer into one virtual database while preserves the
integrity and uniqueness of customer and non-customer systems and tools. Several of our
customers use a CRM system as: a sales automation system for direct sales teams, an MA
tool for business environment analysis and the execution tool for campaign and lead
management.
Relayware Ecosystem Collaboration Solution
Meanwhile, Relayware manages all demand-side ecosystem interaction including sales
and marketing collaboration, service and support and learning. Relayware also provides
Integrating CRM
and external
collaboration
systems allows
organizations to
bring together all
parties in the
ecosystem.

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valuable channel reporting, analysis and decision-making support; it is therefore widely
used by a broad range of internal functions as an invaluable business tool and data source.
With its broad range of communications channels, including web, email, social networking,
messaging and mobile, Relayware also ensures that companies can get their messages to
the right people at the right time no matter where they are or through which device they
choose to communicate.
PRM is obsolete but (Social) CRM is here to stay. However, since CRM lacks the capability
to facilitate collaboration, integration between CRM and ecosystem / external collaboration
and social communication solutions will become commonplace and, will be in our view
both an optimal solution to significant business challenges and a means of capitalizing on
many significant business opportunities.
The rest of this book examines the relationship lifecycle between companies like yours and
their demand-side ecosystems and establishes best practice in using external or
ecosystem collaboration and social communication technologies to substantially improve
productivity, outmanoeuvre your competition, drive increased revenues and improve your
return on investment in sales, marketing and support activities associated with your
indirect channels.

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Chapter 3: Selecting Your Ecosystem
Earlier, I described the indirect channel relationship lifecycle which by its very nature is a
continuum. But we have to start the process somewhere and it seems logical to begin
where all channel engagement strategies should, but often don’t begin – selecting the type
of organizations needed to achieve your business objectives. I also drew the analogy
between your relationship with your indirect channels and your relationship with
employees. Logically before recruiting, on-boarding, training, motivating and managing
new sales or marketing personnel, you would start by writing a job description defining the
location, role, responsibilities, required skills and competencies associated with the job.
Incredibly many companies embarking on an indirect channel strategy for the first time
ignore this step and companies with mature strategies rarely if ever review their channel
selection. The former often examine the channel landscape and try to reverse-match what
they see with their needs. The CEO of a Silicon Valley cloud security software start-up
typified this behavior recently when he told me ”we went after the VAR channel that sell
Symantec and McAfee but we’ve found it very tough to get traction.” Of course they have.
Symantec VAR’s have no motivation to sell a start-up’s cloud service when they already sell
the market-leader’s conventional licensed software!
The latter stubbornly stick to an established channel even though over time, they’re target
markets and / or products may change significantly.
Go to Market Strategy
The first step in developing your indirect channel strategy is to ensure that you have a clear
understanding of your existing go-to-market strategy. This seems obvious. But ask
yourself:
• What are our target markets - geographic, product, horizontal and vertical?
• Who are our target customers - who benefits from our products and services, what
size and type are they?
• What kind of indirect channel addresses these customers offering the kind of
product and services they want to buy?
• What products and services do we have that will address the needs of the
customers and which will appeal to the channels that service them?
• What are our value propositions to both customer and channel indirect channels?
Answering these simple questions will lead you to the right indirect channel channels and
help define your indirect channel selection and recruitment strategy by establishing
selection criteria.
The first step in
developing your
indirect channel
strategy is to
ensure that you
have a clear
understanding of
your existing go-
to-market strategy.

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The Importance of Good Data
All too often, companies choose their indirect channels based upon small amounts of data
that can be easily accessed, or make attempts to gather more detailed information with a
manual approach.
The result is that important clues about why certain companies are unlikely to make good
indirect channels are missed and more importantly, companies fail to discover the
companies that could become some of their most successful indirect channels. Remember
the words of the cloud services executive from earlier in this chapter?
Many companies mistakenly assume they know who the ideal indirect channels are based
upon local knowledge and ‘gut feel’. Whilst this approach may work on a local scale it
cannot succeed as a basis for a regional or global strategy. To get a complete picture of
your potential indirect channel landscape, you must consider detailed research, data
pooling and if necessary data acquisition. Before you start, decide what kind of information
you will need to know about each indirect channel in order to:
• Assess their suitability for partnership (your selection criteria)
• Benchmark them against their competition
• Communicate with them when the time is right
Pull together as much data as possible from internal sources on as many existing and
potential indirect channels as possible. Leave no stone unturned. Draw from your
marketing databases, contact lists, ERP, SCM, LMS, MA and CRM systems and create a
single central repository in which to store your indirect channel data.
When you have exhausted all existing internal sources, consider utilizing low-cost
resources to conduct web-based desk research, find out who is selling for your direct
competitors, contact your distributors for sell-through and contact data or as a last resort,
approach a data specialist with a very tight brief. Ask the provider to map the data you
already have against the total data they have available ensuring that you are supplementing
your existing data rather than replacing it with exactly the same companies - at your own
expense. Most importantly, ensure that you acquire current contact information on key
personnel - understand who you can’t sell to, market to or recruit through, choosing only
the contacts right for you.
Don’t be surprised if the indirect channels you subsequently select are very different from
those you expected or the channels you have now. Most companies outgrow their indirect
channel network as their go-to-market strategy evolves but as I highlighted earlier,
surprisingly few take proactive steps to do anything about this. Remember, indirect
channels don’t always evolve at the same pace or in the same direction as the companies
whose products they sell.
To get a complete
picture of your
potential indirect
channel
landscape, you
must consider
detailed research,
data pooling and if
necessary data
acquisition.

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Few companies have the patience or nerve to invest in indirect channel development or
reselection. History offers many examples of companies who have found a very real and
urgent need to find alternative channels to market. Note that when Apple launched the
iPod, the company’s global franchise network of Apple Center’s had little to offer the
company in taking it to market. And cannily, Apple chose to complement established
retailers with its own chain of retail outlets.
Common Data / System Complexity with CRM as the Hub
Above all, start with defining what you need to know to achieve your goal of indirect
channel selection, create a single data repository with a consistent data structure that
meets your current and your future needs. The resultant indirect channel database should
be accessible as a business tool by all those in your company who will need to interact with
your indirect channel network. It is important also that you develop a strategy and a
methodology for maintaining the data’s currency such that it continues to be fit for purpose.
As we shall see later, CRM systems seem like the obvious choice but beware! Think about
what you intend to do with the database once you have built it and then decide whether a
CRM system will be flexible enough to support the complexity of an indirect route to market
while enabling self-profiling and the range of programs you will no doubt wish to automate.
Sales automation alone addresses few if any of the key lifecycle components alone.
Common Data / System Simplicity with CRM as the Hub and Relayware
as Channel-Centric System
Think about what
you intend to do
with the database
once you have
built it and then
decide whether a
CRM system will be
flexible enough to
support the
complexity of an
indirect route to
market while
enabling self-
profiling and the
range of programs
you will no doubt
wish to automate.

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Chapter 4: Segmentation, Accreditation and
Tiering
Once you have decided which indirect channels you need in order to implement your go to
market strategy, it’s time to establish a framework for your ecosystem. Engaging with your
channel as an amorphous mass is as unthinkable as engaging with your customers in the
same way so you need to create communities of entities that share common attributes so
that you can communicate and ultimately collaborate and facilitate collaboration in the
most effective and productive way.
Once again, data is critical here. Just as with selection, you need to decide which attributes
are important to you and how you will use them to segment your channel.
Accreditation
I will illustrate segmentation methodology by using channel accreditation as an example.
This is because if it is done properly and utilizes balanced scorecarding, it can be very
effective.
First a word of caution! Using an accreditation or certification scheme to segment an
indirect channel has been the norm in several industries for decades but just because
accreditation is the accepted approach does not mean that it is right for every company.
Before you consider it, ask yourself a few questions to assess your true objective:
• Do I want to maximize the number of indirect channels I recruit?
• Conversely, do I want to recruit and retain only those indirect channels who meet
stringent criteria?
• At what stage in the technology lifecycle is my product?
• What do I want to measure and can I measure it?
• Can I monitor and manage an accreditation program?
• In who’s best interest is an accreditation program - ours, the customer’s or the
indirect channel’s?
• What would compel indirect channels to join a program?
• What commitments will I require in return?
Accreditation programs are typically unappealing to mainstream channels because they
require investment to participate and generally deliver limited rewards. By contrast, value
added channels (Value Added Resellers and Distributors – VAR’s and VAD’s) keenly
Using an
accreditation
scheme to
segment an
indirect channel is
not the right
approach for every
company.

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embrace them because they provide a means of specialization and differentiation.
Specialization is the key. VAR / VAD channels don’t want to maintain multiple
accreditations unless they are complementary. It is therefore important to understand your
objectives in developing and implementing such a program.
Any product’s adoption lifecycle can be visualized using a bell curve as shown below:
Aligning Indirect Channels with a Product’s Lifecycle
If accreditation seems like the right approach, take a pragmatic approach to defining the
criteria:
• What knowledge, skills, facilities are actually required?
• Will accreditation be awarded based upon quantitative or qualitative criteria or
both?
• What exactly will I measure?
• Do I have the necessary information and if so, how will I analyze it?
• How will I administer and manage the program?
• How will we play our part in supporting the channel to maintain their accreditation?
• What will happen to defaulters?
• What are the rewards for retention?
• Do I have the systems, processes and resources to manage the program?
The first rule is ‘don’t set criteria that are not absolutely necessary’. If your channel can see
no point in your criteria and they have no knock-on benefits to the customer, then your
channel will be less inclined to try to achieve them. The next point is very subjective but our
view is that revenue, volume and unit sales targets sit rather uncomfortably alongside
value-based accreditation criteria. Accreditation schemes that start out with conflicts of
As the market’s
familiarity with the
underlying
technology grows
and the product or
underlying
technology begins
to enter the
mainstream, a
more ‘inclusive’
indirect channel
strategy is needed
to drive
widespread
adoption and
higher sales
volumes.

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interest rarely succeed and in our experience, the need to achieve quarterly revenue
targets often outweighs the need to maintain the credibility and respectability of an
accreditation program.
It is important to ensure that criteria can be accurately and consistently measured and
properly audited. You must be in possession of all of the data required to award an
accreditation. As a general rule, data that can be sourced from and verified upon internal
systems and data sources is more reliable than data that is sourced from third party
sources, especially the indirect channels themselves.
By now, many companies will be thinking ‘the only irrefutable data I have relates to sales
results and numbers of trained personnel’ and it is for this reason that most companies
often distil their accreditation scheme criteria down to these two factors. Beware! If an
accreditation scheme is to be truly valued by indirect channels and customers alike and if it
is to deliver results, you must be much more thorough.
Value Based Segmentation
A tried-and-tested approach for value-based indirect channel segmentation is based upon
the balanced scorecard method. Using this approach, you can identify all of the criteria
both quantitative and qualitative and assign those scores and weightings that reflect their
importance, scoring each indirect channel or potential indirect channel accordingly.
The balanced scorecard approach works well in two different scenarios:
1. When relatively small numbers of indirect channels are involved and hence the
process can be managed adequately using manual methods
2. When larger numbers of indirect channels are involved and a suitable technology
solution is deployed to conduct automated analysis
Both scenarios require good data sourced from a variety of places:
• Your transactional or ERP systems
• Contact databases used by marketing staff to distribute channel marketing
communications
• Contact management systems used by channel account managers
• Training or learning management systems
• Technical support systems
• External sources such as data companies, industry directories and trade show
catalogues

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Input from these various sources needs to be brought together into a single repository and
one must ensure that it is accurate, consistent and uniform. When these conditions are met,
you can scorecard your indirect channels.
Multiple Measurement Criteria
Establishing multiple measurement criteria creates a need for repetition and continual
validation. This is complex to manage and nowhere will this complexity be felt more than in
the areas of fulfilment and administration. Before embarking on this route, ask yourself:
• Who will transfer the knowledge to your indirect channels to the level you require?
• Who will monitor and manage accreditation criteria attainment across your
channel?
• What systems processes and supporting resources will be made available to them
to do it?
• How will you manage education, examination and certification?
• How will you manage certification expiry? How will you punish defaulters?
And what of those indirect channels who do maintain their accreditation? Those who do
everything that is asked of them? How will you reward them? How will you protect their
investment? How will you support them to maintain their accreditation? And how will you
manage those who create demand for you without actually fulfilling it? After all, many
companies have the expertise and customer relationships to influence buying decisions
and yet they have no interest in actually supplying the customer with the solution.
Your accreditation scheme must be sufficiently robust and flexible to cater for such indirect
channels for which revenue criteria and product margin will be completely irrelevant and
counter-productive.
Indirect channel segmentation through accreditation is a proven and successful method of
targeting a suitably qualified indirect channel network or channel but only if your product is
in the right phase of its lifecycle. Exclusive models such as this will deter volume channels
from selling mainstream products if alternatives exist in the market. For value added
channels selling early-life, specialist or low volume/high value products, accreditation can
work well depending on the approach to effective administration and management of data,
systems, processes and resources that exist to implement such a program.
Your accreditation
scheme must be
sufficiently robust
and flexible to
cater for such
indirect channels
for which revenue
criteria and
product margin will
be completely
irrelevant and
counter-
productive.

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Social Segmentation
Segmenting your indirect channel based upon compliance with a predefined set of criteria
that is unique to your company, product, market or customers and according to company
profile is for many companies the end of the line. It should be the beginning because so far
you have only satisfied your own needs.
As I intimated earlier, in the past, vendors saw themselves at the top of the food chain with a
succession of indirect channel tiers between them and the customer. They pushed
programs and information downstream and attempted to “manage” their indirect channel. It
just doesn’t work that way today. I’m not really sure it ever did.
Your indirect channel represents a rich and diverse ecosystem of companies and
individuals. This ecosystem is a community that is comprised of many smaller communities
of businesses and people each with shared attributes and each sub-community is
comprised of still smaller groups with shared interests. Companies wanting to be
successful in harnessing the potential of their indirect channel ecosystems in the future will
have to acknowledge that they are nothing more or less than members of these
communities and that they must play an active role in collaborating with and facilitating
collaboration among them. There is no food chain in contemporary business ecosystems.
At a very high level, you know that the constituents in your ecosystem have some things in
common:
• They market, sell, support or recommend products or services like yours
• They market to, sell to, service or support the customers that you want to reach
• They are active where you are or want to be active
• They want to make money
Your task in segmenting this ecosystem is in facilitating collaborative conversations among
companies and people who share common interests and then listening to and engaging in
the dialogue. Do this and the ecosystem will form itself into multiple overlapping
communities all by itself and if you possess the technology to make it happen and to
monitor and track the interactions you will be able to learn more about those communities
and have more effect on their behavior than you could ever imagine possible.
Companies will
have to
acknowledge that
they are nothing
more or less than
members of these
communities and
that they must play
an active role in
collaborating with
and facilitating
collaboration
among them.

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I will address this topic in more detail later in the chapter that deals with collaboration as we
explore how to do it. But here I simply want to tackle the question of why you should. Earlier
I talked about behavioral change in the context of communication methods and
preference. I also referenced a shift in the way individuals are influenced - by the opinions
and expressed consensus of fellow community members than by companies. Logically
then it follows that building communities, facilitating collaborative conversations, and
through them encouraging members to endorse your company, your products and your
strategies will play a big part in generating positive feelings about you and influencing
positive behavior. What is more, eventually the community will become self-sustaining and
a font of knowledge for all of its members. In time reducing the need for you to fuel
conversations and provide answers and support.
Since you facilitate these conversations, they take place on your systems and the output
can be recorded and analyzed you can now use this data to create usable segmentations of
your communities based upon the groups and discussion topics to which they subscribe,
their shares, likes and comments. This in turn enables you to engage in much more
effective targeting of conventional communications. Better targeting and topic relevance
improves response rates and outcomes. We will address much more of this later.
Facilitate
collaborative
conversations
among companies
and people who
share common
interests.

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Chapter 5: Indirect Channel Recruitment
In the previous chapters, we examined methodologies for identifying the attributes of
suitable indirect channels and for segmenting those indirect channels into the most
appropriate groups. Now it is time to get those indirect channels on board.
What’s in it for Me?
Many companies now throw together a few deliverables that are cheap and easy to deliver
and dress them with a logo and a brand name. This was fine in the days when the market
was less crowded, less competitive and when companies could differentiate themselves
through their unique technology. But in the age of technology commoditization and
convergence, most lack the means to compel their indirect channels to work with them
simply because their product was the best or the only available.
Today, indirect channel programs themselves have to be the differentiator and through
them, a company needs to convey actions as well as words that motivate indirect channels
to work with them rather than their competitors. But what do indirect channels want to
hear? In essence:
• You will develop products or services that are superior to your competitors
• You will create a desire within your mutual customers to buy new products /
services or upgrade from existing ones
• You will invest in demand generation
• You will make customers receptive to buying your products and your brand
• You will direct customers to your indirect channels
• You will direct your indirect channels to potential customers
• You will minimize channel conflict
• You will provide the necessary information, education, tools and resources to
assist your indirect channels in marketing, selling and if necessary supporting your
products
• You will ensure that the sale of your products / services will prove to a be a
profitable enterprise
• You will make it easy for indirect channels to augment your product / services
offering with complementary products and value added services
• Your will ensure that your products / services deliver on their promise, that they are
of merchantable quality and reliable and encourage repeat purchases
• You will, throughout be easy to do business with and treat your channel indirect
channels with integrity and respect
Today, indirect
channel programs
themselves have
to be the
differentiator and
through them, a
company needs to
convey actions as
well as words that
motivate indirect
channels to work
with them rather
than their
competitors.

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• You will facilitate collaboration between you and your channels and among your
channel communities
• You will communicate with them when, how and how often they choose to be
communicated with
• You will provide easy access to the information, tools and resources they need to
be successful
This constitutes your channel value proposition. Many of these expectations depend
on having great products but if I had a Dollar for every time a company told me they had the
best products but they couldn’t motivate their channel to sell them, I’d be a very rich man
indeed! In fact if you get the other elements of the value proposition right and implement
them better than your competitors, it is entirely possible to have inferior products but a far
more dedicated and motivated channel than they do.
We will discuss best practice in indirect channel program deliverables later in the eBook,
but at this point, there are two important principles to remember:
4. The best recruitment campaign in the world will fail if your indirect channel program
is not compelling
5. The notion of ‘build it and they will come’ - having the best program but failing to
market it and proactively and systematically drive recruitment will also fail
Recruitment Campaign
You would not set out to recruit a sales person or marketer without first documenting the
following:
• For what purpose is the role being created?
• What is the context for the appointment?
• What are the goals, fiscal or otherwise of the individual to be hired?
• What resources will be made available to the individual to assist them in achieving
their goals?
• Which markets or customer segments should they be targeted upon?
• To whom do they report?
• How will their performance be monitored and reviewed?
• How will good performance be rewarded and poor performance punished?
• What compensation and benefits will be given?
• By what contractual obligations will employer and employee be bound?
• Why should the candidate join you instead of another company?
If you get the other
elements of the
value proposition
right and
implement them
better than your
competitors,
it is entirely
possible to have
inferior products
but a far more
dedicated and
motivated channel
than they do.

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You would also establish a candidate profile and a brief to the recruiter.
Similarly, you should not embark on an indirect channel recruitment campaign without
ensuring that you are clear on all of these points:
• Why are you looking to recruit new indirect channels?
• What does it mean for the indirect channels you already have?
• What is the context for the campaign?
• What do you want your new indirect channels to do for you?
• What targets will be set, if any?
• How will you establish joint business plans and ensure they are implemented?
• What resources will be made available to new indirect channels to assist them in
achieving your shared goals?
• Which markets or customer segments should they be targeted upon?
• How will the indirect channel make profit from the relationship and how much?
• What other benefits are on offer?
• Who will be responsible for managing the relationship? Who or what will be their
point of contact?
• How will their performance be monitored and reviewed?
• How will good performance be rewarded and poor performance punished?
• By what contractual obligations will company and indirect channel be bound?
• What makes your package of offerings better than any other company with whom
you are competing for the indirect channel’s attention?
• Which channels of communication will be used to drive the campaign?
Ultimately, your aim is the same - to recruit the best indirect channel organizations, sales
people and marketers to work, albeit indirectly for you to help you to take your products to
market at the expense and exclusion of your competition. If you think of it this way, your
recruitment campaign will proceed with greater vigor and purpose and both you and your
potential ‘candidates’ will have a much clearer understanding of your objectives.
Recruitment Process
Whether you adopt the ‘big bang’ approach of launching a new indirect channel program
with accompanying PR campaign or the more low-key approach of augmenting your
existing indirect channel-base as part of your existing program, it is important to preface
any communications with messages reinforcing the points above. You must set the context
of the recruitment, why you are doing it, what it will mean for you, what it will mean for

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existing indirect channels and most importantly what it will mean for and how it will benefit
your target indirect channels.
Putting the actual marketing communications activities to one side; we will deal with them
in later section, let’s turn our attention to creating a low cost and efficient means of inviting
indirect channels to join you and processing their applications.
Mediums
Email has been the de facto standard communication medium for many years but it is in
decline and also statistically weak in generating responses. Spam filters and security
software have exacerbated the problem. As we discussed earlier it is generally in decline.
Social media has, by contrast exploded in popularity as a communication medium. It has a
role in channel recruitment in three ways:
1. As a medium for promoting membership of your program in general terms
2. As a means of viral dissemination of your program and associated value proposition
3. As a means of new recruits re-messaging their participation in your program to their
own social networks
The first two can be achieved through any concerted social marketing campaign. The latter
requires the necessary social through-marketing technology such as Relayware.
Targeted Campaigns
You must remember that in order to have whole companies to partner with you, you must
start by recruiting individuals – companies don’t form relationships with other companies –
people do.
It is essential therefore that you gather accurate contact information; names, job roles,
email addresses, social ID’s etc. of you are to target the right people with the right
message. We discussed this in earlier chapters but here it is critical. Sales people will have
different motivations to join your program to those of a marketer or support person. You
must play to these motivations effectively in your communications if you are to succeed in
making your campaign above average in terms of response. This means that you will need
to engage in targeted and personalized campaigns using every conceivable
communication channel including online, email and social media, segmented by
organization type, market focus type and job role type and so on - communicating multiple
value propositions to each. This takes time and effort but the results will be worthwhile.
Communications should direct the individual ideally to an online or mobile registration
point within which you can gather more information about them, populate and enrich your
database whilst ascertaining if your judgment in inviting them to join you was correct. The
Communications
should direct the
individual ideally
to an online or
mobile registration
point.

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same registration point must be available via your corporate website to catch stray
applicants that you may not have invited or who missed your recruitment campaign first
time around.
Since by now you will have devised your indirect channel selection and segmentation
criteria, you may now begin the process of mapping applicants against them and either
approving or rejecting their application. This can be an arduous and time consuming task
best automated especially if your campaign has been broad. Needless to say, ensure you
have the necessary systems and/or business processes in place before you begin.
On-Boarding
Imagine going on a first date with someone in which you have a vague but as yet
unqualified interest and half way through your appetizer they start talking about taking a
long vacation together or having children. “Slow down!” I hear you cry.
But indirect channel development is a lot like dating. Move too fast too soon and the
relationship may come to an abrupt end leaving you wondering what it was that you said or
did wrong. Indirect channels tell me all too often about companies who initiated a
recruitment campaign promising a commitment to a long-term strategic partnership. They
committed to the provision of a range of benefits, information, tools and resources to help
them to profit from the relationship. But the minute they expressed their interest, the
company insisted on training them, certifying them, setting revenue targets and joint
business planning. They wanted them to close poorly qualified sales leads and register
deals. Incentive programs followed and meanwhile, they cried, “slow down!”
In signing up to your program, a new recruit has likely said to you:
• “I am interested in partnering with you. What now?”
• “I may have a short term requirement to sell your product but let’s see how this
goes.”
• “I bought into your value proposition but I need to see how you deliver.”
• “I like your story, now let’s experience the substance.”
• “I don’t like or I am losing interest in your competitor. Can you do any better?”
…or something similar. What you do in the coming weeks and months will set the tone for
the coming years. Prematurely introducing programs or initiatives that require the indirect
channel to make more commitment than they are ready to give or which require them to
make investments that you can’t or won’t match may turn them off. Before an indirect
channel can reasonably be expected to proactively sell or market your products, you need
to nurture them through a number of steps. Remember the relationship lifecycle we
discussed before:
What you do in the
weeks and months
following
recruitment will set
the tone for the
coming years.

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This illustrates the steps to consider:
• Before you can optimize indirect channel performance, you need to be able to
manage and measure performance,
• Before you can manage and measure performance, you need to be able to provide
adequate service and support to facilitate it,
• Before you can provide service and support for sales, marketing and customer
service activity, you need to facilitate collaboration in those and other areas,
• Before you can collaborate on sales, marketing and customer service, the indirect
channel must be sufficiently motivated and/or incentivized to work with you,
• Before you can incentivize and build loyalty with an indirect channel, you need to
have adequately developed and “enabled” them to perform the tasks that you
require of them,
• And before you enable them, you need to recruit and then on-board them so that
they feel sufficiently ready, willing and able to invest the time and resources
necessary.
Going back to my earlier analogy, on-boarding is a courtship. A succession of small steps
taken at the indirect channel’s own pace towards a close and lasting indirect partnership in
which both parties have made a significant investment of some sort. I’ve seen some a
handful of well executed on-boarding strategies and they typically work something like this:
• Immediately after registration, send them portal and (if you have one) mobile app
download instructions and login credentials together with a soft welcome pack
• Prepare your portal and mobile app so that they display welcome content and a
short video tutorial “how to work with us” for the first-time visitor
• Consider also a “how to use our online tools and resources” video tutorial
• Invite them to update their profile and share their own interests in the partnership to
help your targeting
• If they don’t engage immediately, be prepared to follow up very frequently by
automated time-triggered mail, push-messaging and by telephone in those early
days while they still remember why they took the first step
• After the first portal or mobile visit, track their activity constantly. Apply scoring and
nurturing techniques to segment your channel base into usage / engagement /
activity-level groups and target them with communications designed to increase
activity
• Make ongoing use of time- and event-triggered communications, e.g. “they did X
today so in Y days, we’ll send them a communication about Z.” using email and
social updates
Statistically,
indirect channels
who were well
nurtured during the
first 6 months stay
with you and go on
to deliver higher
performance for
longer.

The Definitive Guide to External Social Collaboration and Indirect Channel Marketing

The Definitive Guide to External Social Collaboration and Indirect Channel Marketing

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The Definitive Guide to External Social Collaboration and Indirect Channel Marketing