What We’ve Learned from 3 Years of Consulting on Go-To-Market Strategy
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This month, we’re celebrating three years of Gilroy Associates (GA)! We’ve been reflecting on why we retired from corporate life to start a consulting practice, what we expected to accomplish, and what we’ve learned so far.
When we started Gilroy Associates, we had a hunch. For years, we’d been solving the same problem inside major software companies:
No clear go-to-market strategy.
No clear value proposition for partners.
A frustration in profitably winning in the mid-market.
Not enough top talent challenging the status quo.
Our hypothesis was that those problems were universal. We expected that most companies were struggling to create a go-to-market strategy. We quickly learned that our hunch was correct.
We have heard the same questions time and again from leaders in the industry. They say:
We’re an engineering firm. We build amazing products — but how do we get partners to sell them?
We know we need partners, but where do we start?
How can we optimize how our direct sales teams and our partners work together?
Here’s what we know about this industry: It’s expected that you’ll have great products. That’s table stakes. The true differentiators are having a consistent go-to-market (GTM) strategy, a powerful partner economic value proposition, and the right talent to drive your strategy.
That’s why we’ve been focused on GTM, channel strategy, and people for the 30+ years of our careers.
People call us when:
They’ve been growing through their direct sales teams, but know they need a partner strategy.
They see a stacked SG&A (direct + indirect) or profit leakage through inconsistent or unclear GTM.
Their partners do not invest ahead of revenue.
There is no internal alignment on the value of a partner channel.
They’re not meeting corporate objectives of profit, revenue, product mix, new logos, etc. and they’re looking for best practices from someone who’s been in their shoes.
The Channel Partnership Model We Implement
We ask these questions:
Do you have a clear Go-To-Market strategy?
Are you consistent in terms of where you want partners to augment your capabilities and extend your coverage? Do you know the difference?
Could partners deliver services, provide maintenance, or install custom configurations on your behalf?
Could partners be your “feet on the street” in a geographic region you couldn’t reach otherwise? Maybe they speak a local language, have a physical presence in a country you don’t, or fulfill local T & C you can’t meet directly.
Could partners help you reach customers in a given industry? For example, you may want to target healthcare, but you don’t have the expertise on staff. A partner with healthcare experience and contacts would be a solid extension of your sales team.
Is it clear how partners make money selling your solutions, product, or services?
A partner won’t augment or extend your business unless they have a clear path to making money, which we call the partner economic value proposition. Do they know what “drag factor” (of other software, hardware, services, and support) they can expect when they sell your solution? It doesn’t really matter if you have the best products if a partner doesn’t know how to (or can’t) make money selling them.
Do your partners have a blueprint for success? As your “off payroll” sales, business development, and service & support teams, partners need to be every bit as effective as your direct team in representing you.
Have you developed enablement resources so your partners know what to sell and how to sell? Enablement is not just for sales; you need to provide technical — and potentially marketing — enablement as well.
Do you share market intelligence and other insights so your partners know where to sell?
Do you help with lead generation resources and content to help partners convey accurate and consistent information?
Is your partner program effective in both attracting new partners and retaining them?
We think of partner programs like frequent flyer programs (at least when we were all traveling!). Do partners clamor to join you? Do they strive to reach the next level of achievement?
Equally important: Is your program driving the partner behavior you need? If your goal is to drive partners to cloud, are your benefits all over-weighted to cloud? Or if you’re driving to a more linear quarter, are you lining up your incentives to drive to linearity?
Are you predictable to your partners? Partners need predictability in order to want to invest with you.
When you bring on a new partner, you should give them guidance on what market(s) to pursue — and commit that you won’t undercut or compete with them in that market. (This happens all the time! A supplier sells directly into the partner’s territory.)
Your partners need clear expectations and guidelines, and they need to be able to trust you. In our past, we launched a hard deck to spell out internal and external expectations and guidelines of who sells what and where. When partners don’t have that predictability, they won’t invest in selling your products and no one will get the success they want.
When you answer these questions with clarity and intention, the channel becomes a major asset.
After three years consulting with software businesses, we feel more strongly than ever that the channel is a huge opportunity that remains under-optimized. Your channel strategy shouldn’t be an afterthought.
Our message: Invest in your channel strategy. Get your senior leaders (including the CFO, CMO, and head of sales) aligned on that strategy. Appreciate the potential of your channel. Build intentional partnerships, and revisit your GTM strategy frequently to make sure it still syncs with the needs of the business. If your products, customer base, or goals change, make sure your channel strategy changes too.
We’ve seen the power of the channel done right. We’ve changed the minds of company leaders who once saw channel as a cost, not an asset. Use your channel partners as your flex sales force to help you meet all your goals — revenue, profit, customer satisfaction, and new logos. Done right, the channel can be your secret weapon.
Thanks to everyone who has supported us in our consulting journey over the last three years. If you need an outside perspective on your GTM strategy, give us a call.