Latest / Partnerships Unraveled / 113 - Heather K. Margolis - Cost of Eliminating the Channel Chief

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113 - Heather K. Margolis - Cost of Eliminating the Channel Chief · Partnerships Unraveled

• 0:07
  Speaker 1: Welcome back to Partnerships Unraveled, the podcast where we unravel the mysteries about partnerships, and channel on a weekly basis.
• 0:13
  Speaker 1: My name is Alex Whitford, I am the VP of Revenue here at Channext and this week I'm excited to welcome our special guest Heather.
• 0:19
  Speaker 1: How are you doing?
• 0:20
  Speaker 2: Great, how are you?
• 0:21
  Speaker 1: Yes, I'm doing extremely well.
• 0:23
  Speaker 1: I think this is going to be a a good episode.
• 0:26
  Speaker 1: How do we seem to have a bit of a meeting of minds?
• 0:28
  Speaker 1: No pressure yeah, yeah, exactly now I'm.
• 0:31
  Speaker 1: It's going to be the best podcast anyone has ever recorded.
• 0:35
  Speaker 1: Awesome, heather.
• 0:37
  Speaker 1: Maybe, for the uninitiated, you could give us a bit of a rundown of who you are and where you come from yeah, we have like 45 minutes just for the intro, right, right.
• 0:44
  Speaker 1: A hundred percent.
• 0:45
  Speaker 1: So data, birth, ancestry, the whole thing down.
• 0:49
  Speaker 2: So I started Channel Maven in 2009 after working in channels both on the partner side and the vendor side for companies like EMC, egenera, equalogic, and eventually Equalogic was acquired by Dell and just started Channel Maven in 2009, built it for 10 years, decided that there was a software platform.
• 1:11
  Speaker 2: I also had to start Never suggest starting two companies or having two companies at the same time and then sold both of those to 360 Insights, a channel incentive management platform, at the end of 2021 and ran marketing for them for the last two and a half years.
• 1:28
  Speaker 2: And then, about six months ago, just met with the CEO and decided it was time for me to go back out on my own and got the name back and everything, and I'm reinventing Channel Maven, as it were.
• 1:41
  Speaker 1: What does reinvention look like?
• 1:43
  Speaker 1: That's a great word.
• 1:45
  Speaker 2: Yes, yes, no pressure there either.
• 1:47
  Speaker 2: You know it's so interesting since in the last three years we've really sort of moved from.
• 1:54
  Speaker 2: We still have the traditional channels and the problems surrounding solution providers and MSPs, but we're also moving into this partnerships space, which I've really enjoyed all of the people that I've met through that and just realizing that it's a very different kind of relationship.
• 2:10
  Speaker 2: I'm all about building relationships and figuring out what's best for both parties.
• 2:14
  Speaker 2: So the partnership side of things is really interesting.
• 2:18
  Speaker 2: Channel Maven now has gone from we really were consulting and agency and now it's much more consulting fractional.
• 2:27
  Speaker 2: So if there are partnerships companies out there who can't bring on a true partnerships leader for full time, we have an amazing bench of people that can do that and channel marketing and partner marketing.
• 2:40
  Speaker 2: And then also built a curriculum just around for the CMOs that need the help, or CSOs put together a whole curriculum.
• 2:51
  Speaker 1: Yeah, I think the partnership space is wildly interesting because I think people hear partnerships and they go, yeah, we've got tech integration, Awesome.
• 3:00
  Speaker 1: And I'm like, yeah, that's not how it works.
• 3:02
  Speaker 1: Though.
• 3:02
  Speaker 1: What about what's level two, three, four, five and and and downwards?
• 3:06
  Speaker 1: How do you see partnerships changing over the next few years?
• 3:10
  Speaker 1: Cause I see resource being thrown that direction because if it goes right, it really goes right.
• 3:17
  Speaker 2: Right.
• 3:17
  Speaker 2: So I think when you think of the channel, you think of um, resellers, solution providers, distribution.
• 3:24
  Speaker 2: They still need that support, they still need a marketing message.
• 3:28
  Speaker 2: I won't say necessarily marketing materials, but they're selling between five and 25 or a hundred different technologies.
• 3:36
  Speaker 2: So how do you stay top of mind when it comes to the partnership side of things and more of that co-sell?
• 3:42
  Speaker 2: It truly is.
• 3:43
  Speaker 2: How does one plus one equal three?
• 3:45
  Speaker 2: How do your partners take your technology to market but provide services around that?
• 3:53
  Speaker 2: And what's the partner multiplier?
• 3:56
  Speaker 2: How are they making for every dollar of software that they're selling or has already been sold?
• 4:01
  Speaker 2: Maybe they're an influencer?
• 4:03
  Speaker 2: What services revenue, what training revenue can they add on top of that?
• 4:08
  Speaker 2: I find partnerships a bit more strategic with the relationship itself.
• 4:15
  Speaker 1: Well, so while partnerships are getting more strategic, in some ways, channels is getting less strategic.
• 4:21
  Speaker 1: I see a lot of channel chiefs exiting businesses and I think really really some talented people that I know are, and that's as a result of, maybe, sort of the senior strategic leadership team making a change in direction.
• 4:36
  Speaker 1: I know you're seeing that as well.
• 4:38
  Speaker 1: What do you see happening as a result of those changes?
• 4:41
  Speaker 2: Yeah, I mean.
• 4:42
  Speaker 2: I think first of all it's happening because these technology companies are getting pressure from the street and from their boards that they have to cut costs and they look and say, well, this person, this VP of channel marketing, could just roll up to the CMO and this VP of channel sales can just roll up to the CRO.
• 5:02
  Speaker 2: But when you take that layer out, when you take the channel chief out, you are taking out the person that can go to the CRO.
• 5:05
  Speaker 2: But when you take that layer out, when you take the channel chief out, you are taking out the person that can go to the CFO and negotiate for more budget or can rationalize why we're spending so much on MDF.
• 5:16
  Speaker 2: You're taking out the C-level person that can go to the CRO and say this is why channel is so important and this is all the revenue we're getting.
• 5:24
  Speaker 2: And these are the the revenue we're getting and these are the relationships you would lose with strategic partners if they don't have someone who can go to bat for them.
• 5:32
  Speaker 2: And then you're losing that relationship with the CMO, with the person who can say listen, we need the materials to actually speak to partners.
• 5:40
  Speaker 2: Don't just repurpose all of the content that you are for customers and think that it's just going to fly.
• 5:46
  Speaker 2: So you're losing that strategic mind.
• 5:48
  Speaker 2: You're losing the person that feels that they have the ethos to go to that C level and really advocate for the channel.
• 5:55
  Speaker 1: Yeah, it's funny.
• 5:57
  Speaker 1: I was having a conversation with a now former channel chief I think seemed to be re-channel chief again, and he sort of described it as death by matrix for the best EBITDA in the business, which I think when you then sort of sort through that, you go.
• 6:12
  Speaker 1: That doesn't make sense.
• 6:13
  Speaker 1: Channels the most profitable area and if you lose that coordination then performance suffers, especially because I think channel is one of the most complicated routes to market there is.
• 6:24
  Speaker 1: Maybe what are the strategies you'd suggest for a channel chief who's in those discussions and maybe negotiating or or fighting his case for why that role is so valuable?
• 6:35
  Speaker 2: Yeah, his or her case.
• 6:36
  Speaker 2: And you hit the nail on the head it is the most profitable.
• 6:40
  Speaker 2: So, while it might not have the most revenue, it is the easiest revenue to come by, or the least expensive revenue to come by.
• 6:48
  Speaker 2: But only if you're supporting those relationships with your channel partners, you're giving them the resources they need and you're also knowing your place, so to speak.
• 6:58
  Speaker 2: I don't want it to sound the way it does, but I have a client who really is an add-on, so to speak.
• 7:07
  Speaker 2: They aren't a huge piece of an implementation, but they're a crucial piece.
• 7:12
  Speaker 2: So the customer doesn't know to ask for it, they just know what the benefit is for them being in an implementation.
• 7:19
  Speaker 2: To them I would say don't put together materials of your own.
• 7:22
  Speaker 2: Don't expect that your channel partners are going to launch some huge email campaign just about you.
• 7:27
  Speaker 2: Figure out what your ecosystem is, figure out who you sell with and make sure that you are riding their coattails, so to speak.
• 7:35
  Speaker 2: That takes a strategic mind.
• 7:37
  Speaker 2: That's a channel chief that's coming up with that strategy.
• 7:40
  Speaker 2: So for the channel chiefs to go to the C-suite and say these are the types of conversations or relationships that we're having because I'm a channel chief, these are the partners that are willing to do business with us, and I don't mean, like the one-off solution provider or the mom and pop shops, I mean the real opt-in and WWT and Presidio and distribution that are willing to do business with us.
• 8:06
  Speaker 2: Because I'm here in this seat advocating for why we should be at the table.
• 8:11
  Speaker 1: Yeah, I think for me it's about that multifaceted strategy, right.
• 8:15
  Speaker 1: I think so often we get broken because we're talking about the building blocks of the wider strategy, right, and so, like you say, death by matrix, we can put the into the CRO, we'll just put VP of channel sales, right.
• 8:30
  Speaker 1: The problem with that is that's not how you win in the channel, right.
• 8:33
  Speaker 1: And so I think in the double bit is the double threat.
• 8:37
  Speaker 1: So when you're in a direct deal you have two types of competition.
• 8:40
  Speaker 1: You have competitive landscape and the competition of not doing anything.
• 8:45
  Speaker 1: In the channel it's an extra one which is every single partner you work with works with your direct competitor, and so the second they see you slow down or the program become worse or not evolve as quickly.
• 8:55
  Speaker 1: Suddenly all of those people, they have a completely redefined route to market, which is they just go straight across the road.
• 9:01
  Speaker 1: Redefined route to market, which is they just go straight across the road, and so then you can suddenly lose your first tier and your second tier, and correcting that is years of work, and so it feels like such a short term risk to take and I think if you can land that nuance, that's going to help channel chiefs.
• 9:19
  Speaker 2: I would agree.
• 9:20
  Speaker 2: I'm actually seeing some rebounding.
• 9:22
  Speaker 2: So companies that let go of their channel chief 18 months ago and said, oh, we'll just do the matrix, they're now bringing a channel chief back in.
• 9:31
  Speaker 2: So how much did that cost them in those 18 months?
• 9:35
  Speaker 2: Don't make the same mistake.
• 9:37
  Speaker 2: Just don't get rid of your channel chief.
• 9:39
  Speaker 2: The other thing I was seeing, probably up until six months ago I've now seen it correct itself itself is that they would take somebody who truly is a director level, which is fine and great and, and maybe you'll make it to the VP.
• 9:52
  Speaker 2: They were giving them a VP title with a director salary and expecting them to do what the VP had been doing all along, and that just doesn't work either.
• 10:02
  Speaker 1: What?
• 10:03
  Speaker 1: 100% right, because I think we're all in the dogfight of our direct competition and I think it's so funny because we get very proud of our product and our brand and our culture.
• 10:13
  Speaker 1: But, newsflash, lots of businesses do lots of great things, and so then it's the marginal performance differences and so those cuts.
• 10:22
  Speaker 1: You know, we often internally joke, we call it Pepsi Coke, right.
• 10:25
  Speaker 1: But the short game is hey, if we can't do it this way, we'll do it this way.
• 10:29
  Speaker 1: And so very quickly we see that competitive businesses start over-investing when someone else is under-investing, and then that creates this performance, delta and then that, but it represents millions.
• 10:41
  Speaker 1: Right, that's the swing happens faster than you would expect.
• 10:45
  Speaker 1: Maybe to flow into some of the changes you're seeing and trying to help solve, for CMOs are being tasked with a channel strategy, sometimes not their wheelhouse or their background.
• 10:57
  Speaker 1: I know you're working hard on supporting that from a curriculum perspective.
• 11:02
  Speaker 1: Talk us through what those look like.
• 11:08
  Speaker 2: Yeah, absolutely.
• 11:09
  Speaker 2: And this is really the companies that are, you know, 200 million and below.
• 11:10
  Speaker 2: They never had a channel and their board is coming to them saying and now you need to sell through the channel.
• 11:13
  Speaker 2: So there is no channel chief there and they're not ready for a channel chief.
• 11:17
  Speaker 2: They don't need that, but they need a program stood up and they need communications to partners to really encompass what partners need and they also need to help partners drive demand of their solutions.
• 11:29
  Speaker 2: So I put together a curriculum right now.
• 11:31
  Speaker 2: It's the first one is CMO's guide to channel marketing.
• 11:35
  Speaker 2: So that's the first course.
• 11:37
  Speaker 2: The entire curriculum is 12 courses.
• 11:39
  Speaker 2: Each course has 10 modules.
• 11:41
  Speaker 2: Sorry, you have to, you know, listen to my voice and stare at my face for however many hours, but it really was put together to help those CMOs, chief sales officers, cros and also these people that they're bringing in that you say, okay, great, you're a marketing manager, now you're a channel marketing manager and the person's like I don't know the difference or what that means.
• 12:01
  Speaker 2: So this curriculum is really designed for that audience, to ensure that they, you know, can spend just a little bit of money to get a full course worth of what they should be doing.
• 12:12
  Speaker 1: Yeah, and I think it's so important.
• 12:14
  Speaker 1: We're hearing so often that VCs are coming in and their mandate is channel first, I think, because they're seeing the pickup and they're seeing the control that partners have on directing where business goes right.
• 12:28
  Speaker 1: So if you can capture the source, then you capture a lot.
• 12:31
  Speaker 1: I think one of the stats that's really really underrated is there's lifetime value, which is your customer, but partner lifetime value is significantly more.
• 12:38
  Speaker 1: Talk to me in terms of what are some of the key aspects that you're helping CMOs understand in terms of that partner strategy.
• 12:46
  Speaker 2: Yeah right, it's not immediately apparent how important those partners are.
• 12:51
  Speaker 2: It's not like, okay, we're in Q1 and by the end of Q2, we'll know exactly how much revenue our partners are bringing.
• 12:58
  Speaker 2: First thing I would say is, if you don't sell through partners, you have lost all access to an entire audience of customers because they only buy through that partner and not just one partner or not just any partner.
• 13:15
  Speaker 2: They want to buy through the partner they've been working with for time.
• 13:18
  Speaker 2: I have a solution provider who does all of our tech, solution provider who does all of our tech.
• 13:25
  Speaker 2: So it's really important to understand that the channel partners are really sometimes the gatekeeper to an entire audience of customers you might not have access to.
• 13:31
  Speaker 2: And the other thing is to ensure that those partners know that you understand their business.
• 13:37
  Speaker 2: You know what it's like to try to sell multiple technologies.
• 13:40
  Speaker 2: You know what it's like to not necessarily have a marketing person, although many of them say that their VP of marketing is also their receptionist and may also be the significant other of the business owner.
• 13:50
  Speaker 2: But it's also really important to ensure that you're in with the right partnerships.
• 13:55
  Speaker 2: So if you're early on, not spreading yourself too thin, not saying I'm going to go with all the distributors.
• 14:01
  Speaker 2: Focus on one or maybe two distributors.
• 14:04
  Speaker 2: Figure out which distributors are going to go with all the distributors.
• 14:07
  Speaker 2: Focus on one or maybe two distributors.
• 14:08
  Speaker 2: Figure out which distributors are going to get you into the markets you need to be in.
• 14:11
  Speaker 2: Figure out which partners either have a gap in that they really want to sell a technology like yours and maybe they aren't, or they only sell technologies like yours and your ease of doing business is going to get them to move from who they've been selling to somebody else.
• 14:23
  Speaker 1: Yeah, it's one of the things I do a lot of consulting for SaaS companies trying to enter Europe effectively, and it's the thing I really really try to land.
• 14:33
  Speaker 1: I used to run Zoom's distribution strategy for Ramia and I couldn't tell you how many executives at Zoom were confused by the fact that, hang on, we have this amazing direct go to market motion.
• 14:47
  Speaker 1: That, hang on, we have this amazing direct go-to-market motion we're heading up market which in the us, is traditionally even more direct than smb.
• 14:54
  Speaker 1: And then when they went to europe, they saw the complete opposite, where european mid-market and enterprise businesses were going no, no, we only purchase via partners, we don't care how good your product is, we only do this.
• 15:08
  Speaker 1: And suddenly we had to build backwards from the customer to go yeah, but the customer, the partners, deliver all this unique value.
• 15:14
  Speaker 1: And so I would highly um encourage brands who are, who are sort of entering that partnerships and channel-led space, whether that's by geography or by segment or by vertical work backwards from customer to partner, understand how to win the partner.
• 15:28
  Speaker 1: Vertical work backwards from customer to partner.
• 15:28
  Speaker 1: Understand how to win the partner and then work backwards again, because if you get it right that partner, lifetime value right, that's the great thing, you don't just win that first deal.
• 15:35
  Speaker 1: You can win hundreds from then on, but that first deal is so, so critical to get right.
• 15:40
  Speaker 2: Yes, and know what you're capable of.
• 15:41
  Speaker 2: So if you're going into a new market like EMEA and you don't have the support you need internally, go through distribution.
• 15:50
  Speaker 2: Partners love distribution in EMEA and especially APJ.
• 15:53
  Speaker 2: It's just know what you're capable of.
• 15:57
  Speaker 2: I find myself very fit.
• 15:59
  Speaker 2: I can hike a mountain.
• 16:00
  Speaker 2: I don't run unless I'm being chased by a bear and I live in Colorado, so that's possible.
• 16:04
  Speaker 2: But just know what you are good at and know where you need help.
• 16:11
  Speaker 1: So obviously the mainstay of your entire curriculum is that campaigns in a box are the perfect underutilized tool that never fails, and I'm hoping people can hear the dripping sarcasm in my voice.
• 16:23
  Speaker 1: I hope so, yeah.
• 16:25
  Speaker 1: What are some ways that campaigns in a box aren't the optimal pathway, and how can we be boxing a lot smarter?
• 16:31
  Speaker 2: And I will say in Channel Maven's history, we've probably created, I would say, hundreds of campaigns in a box, and now the term makes me itchy Partners are no longer asking you for emails and asking you for, you know, events in a box.
• 16:49
  Speaker 2: That was another one that was super painful.
• 16:51
  Speaker 2: Think about the fact that marketing itself has gotten easier to some extent, and when I say marketing, I mean email marketing.
• 17:00
  Speaker 2: So partners never had something they could send an email through.
• 17:04
  Speaker 2: Now, at the very least, they have something like MailChimp, or even their Salesforce or their HubSpot implementations will allow them to send emails as well.
• 17:11
  Speaker 2: So, backing it down from emails, think about what partners really need help with, and I would say it's things like social selling and digital marketing, and that may be less of an in-the-box scenario and more of a hey, we need help from a consultant who can actually explain this to us, or a marketing agency that can actually explain this to us.
• 17:32
  Speaker 2: Maybe just give us MDF or maybe just give us the copy blocks that we should be taking and putting into our email tools.
• 17:41
  Speaker 2: The other thing I've really liked seeing is companies that are helping their partners create somewhat of an ecosystem and saying you fix this solution, these other two partners fix this solution.
• 17:53
  Speaker 2: The three of you with us should go to market with a campaign that's going to draw customers in, and then we can divvy up and figure out who should be managing which aspect of it.
• 18:05
  Speaker 1: I love that ecosystem point I just had.
• 18:07
  Speaker 1: We just recorded today, actually, the founder of JumpCloud was on and him and a few other key vendors in their ecosystem are going on MSP roadshows and so they're getting existing MSPs who sell the whole stack or part of the stack and bringing new MSsps to let the community train the community.
• 18:29
  Speaker 1: And I love that for two reasons.
• 18:31
  Speaker 1: One, you could see the joy on his face that he's helping build relationships, which makes my heart go nice.
• 18:37
  Speaker 1: And the second is that's true confidence in your go-to-market motion.
• 18:42
  Speaker 1: Right, there is no hiding from the partner's feedback and so if you are getting in in the way like the greatest referral ever, if a msp goes, no, no, we, we not only trust our customers of this, this is helping me pay my salaries and my mortgage.
• 18:56
  Speaker 1: These guys are great.
• 18:56
  Speaker 1: You don't need to do anything right.
• 18:59
  Speaker 1: You've done all the work to get the original msp and just letting them do, uh, do what they do.
• 19:04
  Speaker 1: So I sort of think sometimes we over engineer the, which is if we're in the partnership space, let's let partners do partnershipy things, because that's that's going to win in terms of campaigns in a box not being the right structure.
• 19:19
  Speaker 1: Um, how can uh, how can I mess up?
• 19:24
  Speaker 1: Excellent, now I'll get to market.
• 19:28
  Speaker 2: We almost had a one and done.
• 19:29
  Speaker 1: Yeah, so close.
• 19:30
  Speaker 1: So whenever I record two in one day, it always goes wrong.
• 19:32
  Speaker 1: Right In terms of campaigns in a box not being the perfect utilization.
• 19:40
  Speaker 1: I love that you're focusing on social.
• 19:42
  Speaker 1: How do brands help partners do events better?
• 19:47
  Speaker 2: Yes, I think the first thing is training, and this is with any go-to-market motion.
• 19:51
  Speaker 2: Partners need to understand why they should care.
• 19:54
  Speaker 2: So telling a partner that they should do an event because it's what you want them to do doesn't fly.
• 19:59
  Speaker 2: Telling partners that they should do an event because they're going to get X number of leads just from that event and here's their ROI that will help them.
• 20:09
  Speaker 2: I always ask that companies never do an event solo, so that they always bring either sponsors to the table or, if they're doing something virtual, that they have speakers who can bring their audience to the table.
• 20:22
  Speaker 2: It's always about bringing audiences together, not just trying to do something in a vacuum.
• 20:27
  Speaker 2: So events it depends.
• 20:30
  Speaker 2: If it's a trade show, where you're giving the partners funds for them to set up a booth, that's one thing.
• 20:35
  Speaker 2: If it's more of an ecosystem play, where you're giving those three partners that I referenced before monies to go to a trade show together to do something a little bit more exciting, I think that's even more beneficial.
• 20:47
  Speaker 2: If it's their own event, I would say again make sure you're bringing more partners to the table, more audiences, making sure you're getting butts in seats and some sort of a draw.
• 20:57
  Speaker 2: So I'm doing an event in December.
• 21:00
  Speaker 2: I'd like to think the list is insane.
• 21:02
  Speaker 2: The people that we're getting and I have sponsors, because you never do something on your own.
• 21:07
  Speaker 2: When I show the sponsors there, they're amazed at the P, the level of person coming to this event.
• 21:14
  Speaker 2: I'd like to think it's me.
• 21:15
  Speaker 2: I think it's that we're doing it at Nobu in New York.
• 21:19
  Speaker 2: Excellent, Good you know like just have some sort of a something that's going to draw them in.
• 21:24
  Speaker 2: Either do something really fun like a stock car racing, or or Something that's going to draw them in.
• 21:29
  Speaker 2: Either do something really fun like a stock car racing, or or some sort of a comedian or something that is a draw.
• 21:34
  Speaker 1: or really good food yeah, Great sushi right, that's a great sushi.
• 21:35
  Speaker 1: And cocktails.
• 21:36
  Speaker 1: I mean that.
• 21:37
  Speaker 1: That is the way to do it, Heather.
• 21:38
  Speaker 1: I like to box smart and I like to play partnerships with partnership people, so we always ask our current guests to invite the next guest.
• 21:50
  Speaker 2: Who did you have in mind?
• 21:51
  Speaker 2: Two people, because when they are together, they're both very funny and very insightful.
• 21:53
  Speaker 2: On their own, when they're together, it's it's truly a one plus one equals three.
• 21:57
  Speaker 2: So I think you should try to get Larissa Crandall and Joe Sikora, so Larissa from New Relic and Joe Sikora from Proofpoint.
• 22:05
  Speaker 2: I just think they would be a great combo.
• 22:07
  Speaker 2: Excellent, I just think they would be a great combo.
• 22:08
  Speaker 1: Excellent, I think that means we're going to try and do the first ever Partnerships Unraveled three-person podcast.
• 22:13
  Speaker 1: Thanks to.
• 22:13
  Speaker 2: Heather, it's going to make my job wildly complicated.
• 22:17
  Speaker 1: Heather, it's been awesome having you on.
• 22:18
  Speaker 1: Thank you so much.
• 22:19
  Speaker 2: Thank you so much for having me.