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Voice of Partner Programs from Hardware and Software Companies Leave Many IT Channel Partners Flat

– To maximize VoP programs, companies must listen and adapt –

EVANSTON, Ill. – April 2, 2014

Manufacturers of hardware and software will lose big sales opportunities if they fail to adapt to changes in the sales channel and improve communication with the partners they rely on to sell, customize and manage the installation of their products.  This is especially true for those trying to sell hardware and software as a service via the cloud.

That’s the conclusion of a new study from global sales and marketing consulting firm ZS Associates, which found only about half the channel partners surveyed are satisfied with how well manufacturers solicit partner ideas and communicate changes.

As enterprise hardware and software becomes increasingly commoditized, many manufacturers have launched initiatives, called “Voice of Partner” (VoP) programs, to improve communication with the value-added resellers (VARs), managed service providers (MSPs) and independent software vendors (ISVs) that act as sales channels to corporate end-users. 

In its research, ZS surveyed channel partners about 492 vendor-partner relationships.  Nearly two-thirds (64 percent) of traditional VARs and MSPs are satisfied with the manner in which vendors gather and act upon their feedback, but less than half (45 percent) of the VARs focused on cloud services (i.e., cloud VARs) are equally satisfied.

“This gap — almost 20 percentage points — demonstrates a lag in how well high-tech manufacturers are keeping up with trends,” said Erik Long, ZS principal.  “Too many hardware and software makers have not adapted their VoP programs to serve less-traditional IT channel partners, like cloud VARs.  These cloud VARs often are far younger than traditional VARs.  They also deploy new business models, grow faster and are more eager to engage with their technology vendors.”

ZS noted similar levels of dissatisfaction among ISVs, who were more critical of VoP programs than any other channel-partner class surveyed.  The majority of ISVs do not believe that vendors value their feedback, address their concerns or keep their interests in mind when updating programs.

Aspire to be more than just ‘distributors of technology’

Constructive criticism of VoP programs didn’t stop with cloud-focused and software channel partners, though. Less than half (47 percent) of hardware channel partners were satisfied with their respective VoP programs. Even when it came to grading “best-in-class” hardware vendors, only half of channel-partner respondents said their “best” vendor “considers my input and takes steps to address my concerns.”

“These channel partners seek to expand, as well.  They want to be more than just distributors of technology,” Long said. “They want vendors to help them identify ways to provide managed services and custom work.”

ZS said the survey clearly pointed to opportunities for improvement, though. “More than two-thirds of high-tech revenue flows through channel partners,” said ZS Principal John DeSarbo.  “Today, though, the channel is going through a period of tremendous change. Failure to keep up with these changes and improve partner collaboration in such a tumultuous market will inevitably create dissatisfaction among partners and end-users — and lead to missed sales opportunities.

“There is no ‘one-size-fits-all’ solution for VoP programs.  If you use the same feedback delivery mechanism for all channel partners — whether they are old, new, hardware-focused or cloud-focused — you’re going to receive less helpful feedback and less insight.  You’ll also create more unhappy partners.  Instead, hardware and software companies must consider a customized approach that segments channel partners by specific need and then tailors the manner in which comments are collected, considered and acted upon.”

Among the specific actions that DeSarbo and Long recommend:

Customize the conversation. Address differences across partner business models.

Let partners pick the communication channel. Some will want traditional advisory councils; others may prefer online, interactive community groups.

Acknowledge what you learned. Share the good and the bad from all partners, then explain how you’ll use this feedback to improve the program.

Measure, measure, measure.  Determine the most partner-friendly way to measure satisfaction and loyalty – and then do it.

To view an executive summary of the study, please visit the following link: bit.ly/1lyl6Cl.

About ZS Associates

ZS Associates is a global leader in sales and marketing consulting, outsourcing, technology and software. For more than 30 years, ZS has helped companies across a range of industries get the most out of their sales and marketing organizations. From 21 offices around the world, ZS experts use analytics and deep expertise to help companies make smart decisions quickly and cost effectively. ZS comprises multiple affiliated legal entities.

Greg Austin
Director, Marketing & Communication, ZS

Anahita Wadia Khan / Kyle Adams
Sikich Marketing & Public Relations