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Five best channel partner programs to inspire your own

Marcelo Custodio de Oliveira, Phd
Marcelo Custodio de Oliveira, Phd By Fielo
Five best channel partner programs to inspire your own

One of the best ways to boost sales & retention, expand into new markets, and provide more value to the end customer is to launch an effective channel partner program.

But if you have read our Complete Guide to Partner Programs and are still unsure of how you should build your program, here are 5 examples of world-class partner programs to give you inspiration.

  1. Cisco
    • Has structured their partner program around the roles their channel partners play with customers
  2. Microsoft
    • Has clear program pathways depending on the business model of the channel partner
  3. Oracle
    • Enables channel partners to join as members, and choose how to engage with the company
  4. VMWare
    • Incentivizes the learning of their Master Service Competencies by driving most soft and hard dollar benefits to channel partners who’ve attained those
  5. Caterpillar
    • Has structured their client relationships around close knit dealer communities

High-performing channel partner programs (and why they stand out)

 Unique Value PropositionShows partner expertise through certifications?Requires partner investment?
CiscoPartner program is structured around the roles channel partners play with customers instead of transacting with CiscoYesYes
MicrosoftImmersive Microsoft experience, products, solutions and advisory support for the channel partner that invests the mostYesYes
OraclePartner program aligns with partner’s business modelYesYes
VMWareProvides incentives in the form of joint business planning and co - selling opportunitiesYesYes
CaterpillarDealers are co-equal customer mentors in the Caterpillar marketNoNo

Cisco

The Cisco Channel Partner Program has historically had some criticism for its complexity. However, in the final quarter of 2020, Cisco unboxed a new, unified Cisco Partner Program at their Partner Summit Digital conference. It consolidated their siloed partner programs into a cohesive framework structured around their channel partners’ roles with their customers. 

This award-winning partner program provides its value-added resellers (VARs) with solutions, training, tools and support to help them accelerate profitability and grow their business. 

Partners benefit from earning competencies, discounts, rebates, rewards, and marketing add-ons to support their channel partnership with Cisco.

Competencies offered by Cisco

  • Certifications: This is Cisco’s channel partner program in recognized tiers. There are three levels: Select, Premier, and Gold.
  • Specializations: These help partners build and deliver services across their customers’ lifecycles. Specializations develop their expertise in specific technology areas and people, process, and infrastructure practices.
  • Industry Expertise: The Gold-certified partners are recognized as ‘industry experts’ by Cisco, who can address the specific needs of the healthcare, retail, manufacturing, media, and entertainment industries.

Cisco incentives

Five best channel partner programs to inspire your own 1

Unique Features

With this iteration to their channel incentives, Cisco actively acknowledges that its partners have different sets of expertise – and promotes that diversity. See how different behaviors are targeted through the various incentives? That is key to the program’s success – drive the channel partners according to their relative strengths and weaknesses. 

Here’s why these features stand out as models for other enterprises:

  • Heavy focus on specializations as a gateway to program tiers. Cisco is mapping out for partners how they might present their proposition to end customers.
  • Their new partner program is structured around the roles channel partners play with customers instead of transacting with Cisco.

Microsoft

95% of Microsoft’s revenue comes through partners.

The Microsoft Partner Network (MPN) provides VARs, service providers, system integrators, and consultants with support and expertise in Microsoft’s products and services. The MPN channel partner program also directly helps them service and sell to their clients. 

There are four partner tracks in MPN, reflecting the varying business models in the Microsoft ecosystem. 

  • Build Partners: They create custom solutions on Microsoft technologies, often called Independent Software Vendors (ISVs). 
  • Delivery Partners: They provide outsourced hosting of IT infrastructure on a monthly fee basis, often called Managed Service Partner (MSPs). 
  • Integration Partners: They support customer solutions, offering consulting and design, often called System Integrators (SI).
  • Reseller Partners: They transact license sales or who act as distributors selling to other resellers.

The MPN consists of three levels and focuses on how the channel partner wants to invest in working with Microsoft. 

Five best channel partner programs to inspire your own 2

CommunitySubscriptionCompetency
This is the simplest. It focuses on product training for channel partners and incentivizes cloud-related sales.This one has resource centers based on the “partner’s business practice.” The subscriptions are loaded with internal use licenses, unlimited access to learning content, and training to provide flexible payment options for your customers' IT needs.This is subscription plus advisory hours with MS and a Microsoft Gold Certified Partner Announcement Kit press release.

The more that channel partners want to invest, the more the returns for them. No wonder then that 95% of Microsoft’s revenue comes through partners.

Incentives that Microsoft uses to drive their channel incentive programs 

Broadly, partners in each track are offered the following journey through their program tiers: 

  • Network Member: free enrolment and access to sales, marketing, and technical resources. Requires completion of a business profile.
  • Microsoft Action Pack: membership is around $500 per year and gives free software and training access.
  • Silver and Gold Competency: requires the partner to have trained Microsoft Certified Professionals and provide customer case studies. Competency is in one of twenty technology specializations and is offered at the Silver or Gold level.

The MPN program currently consists of 10s of 1000s of partners, vendors, and service providers that build or sell solutions on Microsoft products. 

Unique Features

These features make the MPN a standout channel partner program – here are some things you can take away: 

  1. Focus shift from reselling to cloud application partners: Microsoft has led the industry in creating a program that focuses on developers and service partners rather than resellers.
  2. Customer value and differentiation: Using competencies and customer case studies, Microsoft links higher program status to customer value and differentiation.
  3. Program tracks: Clear program pathways based on the partner business model so that ISV partners engage differently to MSP or SI partners.

In addition, a unique way in which Microsoft stands out is their #buildfor2030 campaign for its channel partners. With this, MS is helping its partners to amplify their solutions in the commercial marketplace with support for their go-to-market – these solutions often build on or augment existing Microsoft technologies to target specific customer challenges, and further increases Microsoft’s end-user base. 

Oracle

Earlier, the Oracle Partner Network was a tiered program with a membership structure of five program levels: Remarketer, Silver, Gold, Platinum, and Diamond. Each of these program levels had its own set of requirements, benefits, and rewards. In 2020, Oracle released a ‘modernized’ version of the OPN. 

The Modern OPN is built on the tenet of aligning sales behavior to corporate goals. Their objective is to accelerate Oracle’s partners’ transition to the cloud and drive superior customer experience and business outcomes. 

Program structure

The program has three tenets:

  • Customer Centricity: focused recognition in partner expertise areas – including product, geography, and industry – to help customers quickly identify partners that will deliver value for their specific business needs. 
  • Success Driven: increased investment in enablers – including cloud environments, technical assistance, finance, and targeted go-to-market resources – designed to build expertise to drive customer success, grow partner revenue and accelerate the path to cloud.
  • Simplified: a streamlined framework to make partner engagement and interaction much easier. 

The design of the Modern OPN framework precisely aligns with partner business models. The first step on the partner journey is to open the doorway to more significant benefits, join as a member, and choose how to engage with the company – again like many of the big-tech, there is a fair amount of flexibility around what customer needs these channels are solving. 

The Modern OPN has a Channel Rebate and Point of Sale Management function. It enables suppliers, distributors and retailers to interface using the same portal. This is used to plan and manage inventory, decide budgets for rebates to partners and customers and also to involve channel partners at the time of final delivery and execution at the points of sale. 

Incentives that Oracle uses to drive their channel incentive programs

  1. Discounts, rebates and other hard dollar costs benefits:
    • Discounts on Oracle programs for internal use by partners 
    • OPN member (partner) discount for 
      • Reselling Oracle programs and services 
      • Service request packages (for implementation channel partners)
  2. Co-marketing and lead generation support from Oracle’s Advanced Customer Services teams
  3. Soft-dollar business benefits:
    • Participation in partner advisory boards 
    • Eligible for global partner assistance 24×5
    • Learning credits and cloud learning subscriptions 
    • Eligible for Market Development Funds 
    • Eligible for Oracle customer-facing opportunities

More on virtual currency/soft dollar business benefits here

Partners can select tracks based on their go-to-market approach with cloud, on-premise, or hybrid models. The program is divided into “tracks” designed to enable your type of solution, such as:

  • Cloud Path
    • Cloud Build Track
    • Cloud Sell Track
    • Cloud Service Track
  • License & Hardware Track

Five successful channel partner programs to inspire your own 1

The Modern Oracle Partner Network

Partners interested in working with Oracle’s software license and hardware business may select the License & Hardware Track. Each track provides targeted Enablers for partners to grow their skills and succeed in building, implementing or selling Oracle products plus cloud services. Along with access to program Enablers, partners within each track may qualify to Expertise

Unique features

  1. Completing Oracle’s PartnerNetwork Education Training earns its partners additional discounts on their certifications and access to all paid conferences and events
  2. As a member of the Oracle PartnerNetwork, you are eligible to order cloud services for test, development, and demonstration purposes- for example – you may download an unlimited number of development and demonstration licenses for any 1-Click Ordering Program

VMWare

VMware Partner Connect is a single program designed to provide paths to profitability – whether partners want to resell software or services, manage or host services, or provide value-added services to their customers. 

Initially launched in 2009, VMWare’s flagship Partner Network had a siloed and complex engagement framework. Long story short, partners had to sign various agreements to enroll, the engagement process was fairly complex, and it got too unwieldy for partners to get enough value out of it. VMWare revamped its Partner Network in 2020 to drive simplicity in a single program, making the previous one obsolete. 

For their new Partner Network program, VMware has significantly simplified the enrollment process. Partners only need to sign one agreement with the vendor instead of signing separate contracts for each partner-type. They can also pursue individual competencies across hybrid cloud areas, which incorporates data center visualization, digital workspace, application modernization, and security. 

Their USP is that channel partners have access to the full spectrum of VMWare’s portfolio even if they can drive only one market segment. The entire idea is to allow them the mobility to differentiate rather than limit based on past successes. Partners can choose what they want to do based on their client goals, business models and investment strategy. 

Program structure

VMware Partner Connect offers three tiers to its channel partners: 

  • Partner
  • Advanced Partner
  • Principal Partner 

The Partner and Advanced Partner tiers are for partners that engage with customers at the traditional resale, transnational customer relationship level. Principal Partners must obtain Master Services Competencies and demonstrate the ability to build and deliver services on the VMware stack. 

The program is designed in such a way that Principal Partners develop the highest level of capabilities that VMWare has to offer. The program also ensures that if channel partners want to attain far better rebates, incentives and co-selling opportunities, they have to attain VMWare Master Service Competencies. 

Incentives that VMWare uses to drive their channel incentive programs

  1. A role based partner portal that delivers relevant product and industry content depending on whether you are a reseller, retailer or a distributor 
  2. Deal registration benefits for your leads and clients starting out with VMWare
  3. Advanced partners get access to Market Development Funds, front end margins and back end rebates 
  4. Principal partners get access to co-selling field sales engagement opportunities and educational co-investment dollars

Unique features

  1. VMWare’s channel incentive program banks on partners who have achieved Master Service Competencies. They provide incentives in the form of joint business planning and co – selling opportunities. 
  2. VMWare has four specific partner competencies where it promotes partner learning. With this, partners increase their vertical-specific expertise to better service customers, and these competencies validate that expertise.

Catterpillar

Caterpillar, a Fortune 100 corporation and the world’s largest construction equipment manufacturer is built on a global network of dealers. Unlike the big-tech players that we’ve mentioned above, the approach that Caterpillar takes is much more targeted – and fits its niche better.

The dealer network of Caterpillar (CAT) fosters deep relationships in their local communities. Very early on, CAT correctly understood its customers as the hero of its brand story. By fostering vital relationships with its dealers, it engaged them as equal partners in mentoring those heroes to success. 

CAT realized that attention to distribution and product support was a crucial component that was often overlooked by their competitors. The average CAT dealer profile looks like this – they are:

  • Knowledgeable sales representatives
  • Factory-trained and certified service technicians
  • Regular preventative maintenance services through its dealers
  • Customer support agreements

Take a peek at this. We looked up stores near Houston – and right off the bat, there are 50 dealers here.

Five successful channel partner programs to inspire your own 2

Caterpillar’s enormous success with dealers is no fluke. It’s an active call that ensures that dealers are co-equal mentors in their network. Even as a $50 billion+ enterprise, it’s hard to describe their small 200-partner network as anything other than a family. The dealers personify what CAT stands for – customer success, transforming lives, and the future. 

Sometimes, the best approach is a highly personalized approach at a dealer level – with transparent 2-way communication and individualized attention. Here, having the right technological foundation that can allow this becomes essential. 

The Catterpillar Dealer Program – what makes it stand out

  • To tap the full potential of the dealers, you need close ties with your partners. For CAT, dealers serve as the source of crucial market information, act as consultants and problem solvers, and inform CAT about what the customer really wants. 
  • CAT’s Customer Value Agreements (CVA) are big cost savers for the customer. But they are executed in full by CAT dealers. A CVA promises – hassle free maintenance and ownership, expert dealer support, and equipment health maintenance. 
    • When dealers are integrated into the business system, they have a deeper connection with the product. This way, they can be much more than a channel to the customers. They can provide the customer with essential services before and after the sale, such as – advice on the application of the product, insurance, maintenance and repair, operator training and so on. 
  • To create an infallible distribution channel, both the company and independent dealers should be significantly invested in the process. Aside from financial assets, there are softer assets to tap on, such as training and developing a common understanding of what it takes to provide a superior customer experience. 
    • CAT hosts conferences for the Cat dealer community where dealer marketing capabilities in a variety of areas are highlighted. These include (but are not limited to) data analytics, ebusiness, the DIM segment, “Project Deliver” and other initiatives important to Caterpillar and the Cat dealer network.
  • Equipment purchases may be combined with certain dealer rebate programs (e.g., cash rebates), excluding any Merchandise Program (e.g., discounts). Cat dealers can extend their rewards schemes to the end customer. 
  • The quality of the relationship between the company and its dealers is much more important than what it takes to maintain the relationship on the surface. Mutual trust is the keyword here, which can be fostered through a few simple rules – share gains as well as pain, strive for continuity and consistency in policies, and communicate constantly. For a thriving company-dealer relationship, the company should have uniform practices and performance standards for dealers and treat them with equal consideration and recognition. 

Here’s an extremely detailed article by the Caterpillar CEO on how they’ve built their partner network.

The impact of a powerful partner program

Customer influence can’t be bought. It can only be earned by aligning your partner network with the journey you’re planning for your customers. Your partners need to be re-equipped to play a meaningful role in a story that resonates with all parts of the customer lifecycle.

However, setting up a channel incentive program doesn’t need to be a complicated process – even enterprise-tier networks have a simple foundation for their channel partner programs. Here’s a look at how you can quickly start your channel partner program using pre-built incentives.

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