In this insightful episode, we take a retrospective dive into the world of partner marketing as it unfolded in early 2023. We revisit our discussions with internal teams and external experts to evaluate the trends they predicted and how they actually played out.
Our exploration covers a range of critical areas:
* The Focus Shift in Partner Selection
* Scaling Strategies: "If it doesn't scale, it might not be worth it"
* The Power of Through-Partner Marketing
* Data-Driven Success Metrics, beyond total revenue
* Content Leverage and Messaging in lean times
* And steps suggested for Navigating Budgets in a Recession
Join us as we break down these topics, offering insights and lessons on the evolving landscape of partner marketing in 2023 and what remains true for 2024.
_________________________
Connect with the podcast hosts 👇
Connect with Channext 👇
https://bit.ly/channext-demo-request
Watch on YouTube â–º
https://www.youtube.com/@channext
#partnerrelationshipmanagement #channelmarketing #partnerenablement #Throughchannelmarketingautomation
In this insightful episode, we take a retrospective dive into the world of partner marketing as it unfolded in early 2023. We revisit our discussions with internal teams and external experts to evaluate the trends they predicted and how they actually played out.
Our exploration covers a range of critical areas:
* The Focus Shift in Partner Selection
* Scaling Strategies: "If it doesn't scale, it might not be worth it"
* The Power of Through-Partner Marketing
* Data-Driven Success Metrics, beyond total revenue
* Content Leverage and Messaging in lean times
* And steps suggested for Navigating Budgets in a Recession
Join us as we break down these topics, offering insights and lessons on the evolving landscape of partner marketing in 2023 and what remains true for 2024.
_________________________
Connect with the podcast hosts 👇
Connect with Channext 👇
https://bit.ly/channext-demo-request
Watch on YouTube â–º
https://www.youtube.com/@channext
#partnerrelationshipmanagement #channelmarketing #partnerenablement #Throughchannelmarketingautomation
Welcome back to Park Ships Unraveled, the podcast where we unravel the mysteries of Park Ships and the channel on a weekly basis. My name is Rick van der Bosch and I'm the CEO and founder of Chennext, and I'm here together with Alex Whitford, vp Revenue at Chennext. Alex, maybe, instead of a how are you doing today, can you maybe elaborate on why we are sitting here fully suited up today?
Speaker 1:Any long time viewers are going to be. Why the hell is Alex not in basically shorts and a cap, and he's actually wearing a suit? Immediately after this, I think me and Rick are going to go and get belligerently drunk at our Christmas party. So what you can't see off camera is about 40 of our colleagues all looking very dapper and beautiful, and we're excited to celebrate Christmas in a good way as a whole team.
Speaker 2:Yeah, absolutely. End of year it's always a nice moment, right, Reflect a little bit, celebrate together and looking forward to the next.
Speaker 1:Yeah, Christmas is the best time of the year by a mile, Although January depressing, is anything it needs to go Christmas and then basically straight to July. But yeah, I'm looking forward to it.
Speaker 2:I recall a year ago we did an episode around bringing the Christmas vibe into partnerships. Do you remember it?
Speaker 1:No After. It feels like, yeah, we've recorded a lot of episodes. Well, that would have been a year ago, right? So, yeah, it's been a lot of content, but I am enjoying the reviewing idea, as this year or this week's episode, we're going to name and shame some of the predictions that ourselves and some of the industry experts made around what 2023 would bring. Some of them were absolutely spot on, but a few were slightly off the mark. So today we're going to explore some of those.
Speaker 2:Yeah, absolutely. I think what you always see around this time of the year end of December, early January it's always the predictions for the upcoming year, but then I also always really like okay, but what did we make of those predictions, like where we write where we're not right? So we're going to do that today and I think let's just dive right into it. We actually wrote a big article last year like predictions for partner marketing 2023. If you want to read it, you can view it on our website. But we're going to highlight some of them and I think we can start with the one which was the talk of the town back then and I think still it is the recession. So we spoke a lot around that. I think we recall that the prediction that was made around that.
Speaker 1:Yeah, we actually spoke a lot at the time because, well, we certainly didn't predict the recession Otherwise we'd be a genius economist but we knew that was coming, but it was actually around what that means for budgeting, and so one of the big misconceptions about recessions is that that means all budgets are cut. That isn't. It means that budget is allocated very specifically into certain projects and financial scrutiny scrutiny around deals is just goes way up and certainly from our experience, both as ChanEx but also what we're hearing in the channel, is that's 100% been true, but certainly industries have been protected. Cybersecurity is growing faster than ever, but again, because it's quite a defensive product. Right, the requirement is so important there in terms of governance and security that the investment is required, whereas other types of technologies, where it actually isn't as mandatory those more frivolous purchases they've been wound back.
Speaker 2:Yeah, absolutely. I think what we discussed back then was also very much around hey, there's way more stakeholders in the sales cycle, more senior, oftentimes a CFO as well, and we need to also align our messaging there from a partner marketing and a channel perspective towards being very impact driven, like the usual things that we could close maybe back in 22, early 22, with it was not possible anymore for 2023. That was what we predicted and I think, looking back at that, that is also what we really saw. Like, if I look at a lot of the messaging that I'm seeing from our customers the channel partners are putting out, it's very different where we talk way more around the actual impact of the products that we sell to the end user than just the benefits where it was more high over.
Speaker 1:Yeah, and it requires a different sales process and we've seen it time and time again where you almost need separate messaging points and separate reasons to buy on the level within the company that you're speaking to. Right, C level have a different prioritization. The manager has a different prioritization than executor, and so as you're working and navigating through those deals, you need to build messaging and impact orientated messaging to each one of those tiers. Right, the market tier that's using your product isn't the same as the CFO's got to sign it off, and so we've got to build compelling reasons at each level to drive those deals forward. And I think the brands that have oriented their marketing and their programs to support the channel best to do that, they're the ones that have taken a big leap forward this year.
Speaker 2:Yeah, we also discussed quite so much around like enablement of the partners, and that also requires very different enablement from that area. What have you seen on that behalf in 2023?
Speaker 1:Yeah, it's not just what to sell, it's how to sell it right. And it's really important that when brands have shared case studies around big customers that they've closed, it's how they've closed them right. It's reallocating the information into the partners so that they've got a better chance of closing similar, like-minded businesses. And so the brands that have orientated their message to be recession proof they're the ones that have won, and you've got to be cascading that messaging through your partners, and we have seen some really key brands do that very, very well and take huge leap forwards.
Speaker 2:Yeah, I think that's one of the things that they always say right, that the best companies are actually built or reimagined during recessions, etc.
Speaker 2:And I think that's because we really need to focus so much more strongly and really look at what is actually driving business growth whether it's revenue or profitability in the best way.
Speaker 2:And I think that's also something we really saw in the channel, like first, we really tried to serve the full channel and we went everywhere and back and forth. And I think one of the things we also said a year ago is like we need to go way more specific towards a certain set of partners. So not necessarily to very few partners, but also definitely like hey, you have your channel pyramid with different types of partners in that, but you probably, from a resource perspective, can't serve them all now anymore because we can't just keep investing, keep investing. So we need to very deliberately look where do we drive most revenue, what partner base do we have the best margins, etc. I think one of the things we also saw there was actually that one of the trends that were predicted in the article a year ago was that we need to become hyper focused on very specific partners. What have you seen there the last year and do you think we were right, or the article was right, with that prediction?
Speaker 1:Yeah, I'm going to give a big zero of 10 for that one. I think, while logic dictates, in the channel right there's an 80-20 rule. We're going to focus specific time on particular partners and when resources are cut, we should focus on those partners even more tightly. I mean, the maths doesn't add up right doing more of the same with less resource doesn't equal more growth and instead what we've seen is major brands like microsoft and Cisco pivot their strategy to be very s&p focused, very focused on the long tail, very focused on massive partner acquisition and enablement as a way of boxing smart inner sessions, investing in new tooling, new processes, in new teams, to win big by doing exactly the opposite of that prediction, by going wide instead of going deep. And I think it's really hard to predict that accurately, because we've all been very impressed by the rate at which both Microsoft and Cisco been managed to grow. That's because they've taken it on as a completely new strategy, building macro messaging and really taking that out at scale.
Speaker 2:Yeah, I think what we've seen there indeed, for example, with a Cisco, they did acquisition of Splunk and Microsoft launched it very big back in November. Like all in on the s&p Sector, I think there's a couple of things which are actually correlated to the recession there, like the enterprise market was already quite saturated in terms of the spend there on it, but also besides that, what we really see is that within that enterprise there becomes specifically very difficult to sell into once recession hits, like s&p usually is way less, there's way less friction in the buying process and as soon as there was recession, there becomes so much more friction In the enterprise, and I think that's interesting. Indeed, everyone always looks at Cisco and Microsoft as the examples for how to build your channel and we're seeing that more and more now. Indeed, like really looking at the breath of your channel and how can we scale in the long tail versus that super specific target approach?
Speaker 1:Yeah, enterprise is about high conversion. Close right. You hire expensive Sales people, you work with very well paid people who have limited time, and you've got to be driving deals in at the top right. Cfos are going to be really involved in closing, as we've just sort of talked about. If the CFO is locking down the budget, your enterprise pipe dies immediately, right, and so instead, what we've seen I think it's a genius move from Microsoft and Cisco is go, rather than then having a really high conversion game. How do we have a high volume game and you've got to rebuild your channel to do that. And so they've invested in teams and tooling to help drive the architecture and we're hearing like High 30% growth, high 20% growth in a significantly downturn market market. That tells that tells us that, hey, they're making strategic bets and working in a really, really good way. I think it's awesome performance from them and I think it's a key indicator of where people should be betting for 2024.
Speaker 2:Yeah, I fully concurred. I think one of the words or phrases we heard the most from enterprise vendors this year was the high volume, low touch model, and I think that's very interesting. For everyone who's maturing their channel and still wants that significant growth that we've seen in the last year, then SMB is really the market segment to look at.
Speaker 1:Well, we had a big swing and a miss on that prediction. Actually, we nailed the next one, which is 2022 was the year of two partner communication, whereas 2023 was the year of three partner communication. And that's exactly what Microsoft and Cisco have done a low touch, high volume game, directly targeting new end users through their partners, either doing that via direct marketing, virtual account managers or velocity plays through marketing through their partners. That's how they're generating this impact, the only way to scale, and we've seen the best two channels in the world. In my opinion, microsoft and Cisco double down on tooling and people to achieve that, and they've absolutely nailed it, resulting in huge growth.
Speaker 2:And it really aligns with, indeed, that trend. We got incorrectly where they are all in on the SMB and those smaller partners, because those specifically are the partners that lack the time and resources to do marketing and to Generate and user demand. And that's why it's so critical to shift from two partners to two partner, because two partner works really well for your big enterprise partners, the GSIs, etc. Who you give the information and they have internal teams who can then utilize that and send it and share it with the end user, but your SMB partners simply won't do that. So it's critical that you think from a through partner marketing perspective how are we going to Enable those partners, with indeed the right tooling and the right content, to actually get the message via those partners to their end users and help them generate and user demand, even in the down market?
Speaker 1:It's great. Strategy 101 right. They've worked back from the outcome that they're trying to deliver that we're going to go and attack the SMB. What would that mean? We need to acquire a brand like Splunk. We need to go and build a new channel. We need new tooling, we need new people and we need a velocity play to drive demand. And they've done that through through partner communication and they've generated huge results. But it's it. To me, it's an indication that the senior leaders within Cisco, the senior leaders within Microsoft, are really attuned to not just what the market is dictating, but where the opportunity lies, worked back from that and built an awesome end to end program that's allowed huge growth.
Speaker 2:Yeah, and I think the interesting piece of through partner marketing, that also gets us to our next trend, because what we said back then is hey, it's a recession, we need to be scrappy with our resources. We really need to look at how are we going to very efficiently create content and repurpose that a lot. What have we seen there this year?
Speaker 1:Yeah, I'm going to give us a get out of jail free card, because I don't think many people, unless you're really in the space sort of gen AI taking off the way it did in 2023, right, scrappy with resources, how do you build enough content? Well, gen AI is the key that unlocks that at scale, and we've seen products, brands and every salesperson in the world basically adopt gen AI to help drive huge improvements in output, and so, while we didn't see that coming, we thought you'd need to be scrappy. Actually, you do need to be scrappy, but AI is the way to really make that work.
Speaker 2:Yeah, I would love for us to have predicted that trend indeed, but we definitely admit it was crazy ever since February. It was the biggest boom I've ever seen in B2B software and it's just like it went on and on and you really see so many applications of utilizing it for your channel and I think that's indeed interesting. We said you need to be scrappy, you need to be hyper efficient and all of a sudden gen AI pops up where you can literally customize because that was one of our comments we made how important it is to customize your content for the right type of partner so that can be based on verticals or product categories or regions, and I think that really is the critical one where you see gen AI can leverage that so enormously Like all of a sudden you create one content and you can let one piece of content and you can let gen AI actually then distribute it for all the different types of verticals etc.
Speaker 1:Yeah, I think if we knew gen AI was going to take off the way it did, we probably wouldn't be doing this podcast. We'd be on a beach somewhere enjoying the high life, but it's radically changed everything, and I think we all know and we've done podcasts through the year talking about the impact that AI is going to continue to have in 2024. The data scientists and the people far smarter than us have spoken clearly at time and time again. This is the start. Ai evolves faster than anything else we've ever seen and it's already outperforming everyone else. Right, this is going to get better and better and better, and so, while we might have missed for 2023, trust me, it's going to be there in 2024. Yeah, absolutely.
Speaker 2:It's going to be critical for your channel strategy next, next year and really the way to both give your partners the best experience but also get the way higher end user conversion, because you can really tweak it to the right, to the right market segments.
Speaker 1:Yeah, to me, the irony is and I think the businesses that allocate AI really really well they are going to continue to scale at non recession rates while saving money and like that's the, that's really the power, because you go, I've got to cut my resources by 30%, but hang on, I can improve output by 70% by just embedding AI as the cross functional piece. Generative AI for content creation is just going to change the game.
Speaker 2:Yeah, I also saw. One of the other trends that we predicted is that if it doesn't scale, it's not worth exploring. Do you agree there, looking back at this year, yes and no.
Speaker 1:To me, scale is a maturity question, right? So you have to do unscalable things to reach a scalable model, and I think that's just a rule for life. In a recession especially, you have to do a lot of unscalable things because it's harder to win. And so I don't really think that's true. For certain businesses it has been true because they've hit a predictable motion. They worked out the key aspects and then they can just pour it and it just works. But for most businesses out there, especially those who have pivoted we've spoken about Microsoft and Cisco they had to do a lot of unscalable things to land their SMB program. Now there are SMB programs into a flywheel motion. That really works. Guess what? Now we have a scalable motion, but that transition always requires a lot of unscalable work.
Speaker 2:Yeah, I think in my mind I always correlate the word scale to big investments upfront as well and, I think, to eventually get the big outcomes and the return of investments later on, once you've hit scale and really get the unit economics and the economies of scale right. But indeed it's so true Like you don't want to start scaling before you figured out what was working. So start small, make it successful with a couple of partners and as soon as you know specifically in a year like 2023, you want to only scale what's working, and that's why it's so important that you also do unscalable stuff upfront.
Speaker 1:Yeah, I was on a consultancy call the other day with an awesome channel that's building out in Amir, and I asked them a really simple question why are you winning? And if they can't break that down, why we're winning at the end user, at sea level, at mid, at bottom, at partner. Here's the reasons deals are being created. Here's why they're not being created. Here's where we're winning, here's why we're not winning. If you don't know that in detail, don't scale. It's really, really simple because the money's not free anymore, right, the money's dried up, and that means you've got to have really good reasons to buy product just means the ones that are going to win those deals are the ones that have the best reasons why they win. There is zero point scaling unless you understand in detail the reason at the end user, the reason at the partner and the reason at the distributor. For channel. That's even more complicated because it's not in your direct control, and so having that deep and critical understanding is going to be what drives you forward.
Speaker 2:Yeah, I think that's a nice bridge actually to the final trend that was predicted, which was we need to be very much on top of how do we track success, but also how do we communicate success towards our partners and into the channel. I think, looking back at that, like, especially if you want to scale something, you can only do that properly by tracking everything and doing it in such a way Like what do you think? Like how important has that been in 2023 and how important do you think it is moving forward to 2024?
Speaker 1:A recession type money means it's always more important, right? Because, at the end of the day, budgets are all being cut everywhere, and then the question becomes where do you want to cut budget from? And so you want to trim the fact, right. And if you don't know where the fat is, that's where you're really in trouble. And so what we've got to understand is where can we lose resource? Where can we reallocate resource somewhere else and not damage the business? And so, for me, data is about making those accurate decisions, but I'd like to put the question back to you in terms of how you communicate that to your channel. What do you think are the best ways?
Speaker 2:Yeah, it's a good question. Actually, when I was looking at the trend, I immediately felt like, oh, I like that it says communicate towards the channel as well, because I think that's so critical. To keep your partners engaged, you need to continuously show them and give them the feeling that you are either already are successful together or becoming successful, because, especially for the partners, it's the same as within your organization or within the other enterprise companies you are chasing. It's all about where can we best invest our time and money right now? And therefore, also towards those partners, you need to constantly show them what are we doing, why are we doing it, how are we doing it, what's the next step, etc. And I think therefore, definitely that communication is critical piece there, both to partner and the true partner. Indeed, making sure your channel is properly informed, your channel account managers know what type of messaging to drive into your partners. I really feel like 2023 has accelerated there, but I think we should do even more in 2024.
Speaker 1:So I think we did pretty well. We missed a couple of big ones like AI, but I think, overall, our projections have been really accurate. For me, the big note from this podcast is what's going to continue going forward, and so what I would be really, really focused on is how are you going to drive your long tail with, through partner communication and leveraging AI to really take that scale?
Speaker 2:Yeah, 100% agree there, and I think I can tell to our listeners and to you, alex, thanks for this year. Thank you all for listening to us all the time and surviving our voices. And also there's lots of fun stuff and good stuff coming up for next year. We're going to invite a lot more guests. We're going to go way deeper, especially in partner marketing how do you drive long tail and SMB, because that's such a big trend at the moment, and I'm really looking forward to the next one. And for everyone, have a happy new year. If you're already only listening to this in the new year, then I hope you had a nice new one. See you at the next episode.