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Channel sales - who is responsible for demand generation?

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Channel sales - who is responsible for demand generation?

Lots of start-up IT companies choose the indirect sales strategy and quite naturally face the problem of building their channel up and actually making their partners sell. Most channel managers actually believe a channel partner is not really recruited before the first sale is performed - and I definitely agree.

The real question though is "How?" - how to make partners actually sell your products. I believe there's a common misconception - especially among start-ups, that once you've got a channel, you don't have to worry about sales anymore - that's a channel job. Well, that's usually a fake.

I'm always trying to put myself in reseller's shoes and it helps in most cases. Let's try performing this exercise in this particular situation: being a reseller (let alone distributor) I've obviously got a product portfolio. Being successful on the market (and getting back into the vendor's chair I definitely want to work with successful partners), I've got products that sell good and I know how to sell them. Every now and then I hear about new interesting products that might (or might not) have a potential on the market - but why should I bother including them in my portfolio in the first place? There basically are only three possible reasons:
1. The product complements one of the successful products in my portfolio
2. I see a lot of demand for this class of products out there. Better yet, I know this particular product is popular and I will get sales easily. In the perfect world, the vendor would forward me the sales leads
3. The software vendor offers me exclusive long-term distribution rights over my territory - thus I'm securing a unique opportunity for my company

Now, being a software vendor channel professional again, I have to face the fact that unless my product is a "natural fit" for another best-seller product the channel is dealing with already or unless I'm willing to give out territorial sales exclusivity (which is a rare case, but a perfectly well sales strategy sometimes), my company has to take care of demand generation. Otherwise, even if I'm a talented negotiator and I manage to get the channel to sign-up with me, sales won't go through - my partners won't divert their sales resources to my product from their existing, successful titles.

At Bitrix, we've tried to go a one step further: we're not only pro-actively investing into the marketing, generating the demand and forwarding customer leads to the channel; we're actually running ads together with our successful partners - at no charge for them. See the details here:

It'd be interesting to see your comments here - having a feedback is always necessary to make sure you're following the right direction.