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Channel incentives are rewards that a business gives to its partners as an appreciation for meeting specific goals. This could be exceeding specific sales quotas or increasing market share within a given timeframe.
Channel incentives are a great way to encourage your channel partners (distributors, resellers, vendors, service providers, and retailers) to engage in productive behaviors that benefit both parties.
Simply put, channel incentives are a powerful tool for businesses to drive sales and achieve strategic objectives.
As a business, you can use them to:
Channel incentives are monetary rewards channel partners receive from businesses for making extraordinary efforts to achieve or exceed specific goals. They are tools that companies use, small or large, to orchestrate partners' behavior, engender channel loyalty, and enhance indirect sales performance.
Channel incentives are a great way to strengthen relationships with partners, encourage them to sell your products faster, and motivate them to engage in productive behaviors that help grow your business. They are an investment that will pay off in achieving both short-term and long-term business goals.
No wonder businesses across the world, from small to large, design and use channel incentive programs as a tool to:
Channel incentives programs have been around for decades—they were first used by IBM during World War II when they needed to increase their production of ball bearings to meet wartime demand.
From then to now, channel incentive programs have come a long way. As a business owner, you know the importance of finding and retaining high-performing channel partners. That's why you'll have to do much more than just keep them happy. And channel incentive programs are just meant to do that.
They not only reward sales performance but also encourage it. It's a win-win solution for both parties: businesses witness increased revenue, and channel partners feel motivated to sell more with an attractive reward.
In fact, Forrester says that over 73% of trade worldwide happens via a channel, and that's why they are worth the buzz. They are crucial for business growth and can't be overlooked.
Channel incentive programs are a popular way to engage your partners, but they can be difficult to create and tricky to manage without knowing what type of program will work best during what scenario. That's why understanding them is vital.
Here are different types of incentive programs available:
Here are some tips to help businesses manage their channel incentives programs better for enhanced ROI:
Incentive programs are a great way to motivate your channel partners. To ensure that your program is effective, follow these tips and best practices:
These are short surveys that can be sent frequently to check what your employees think about an issue quickly. The survey comprises fewer questions (not more than 10) to get the information quickly. These can be administered at regular intervals (monthly/weekly/quarterly).
Having periodic, hour-long meetings for an informal chat with every team member is an excellent way to get a true sense of what’s happening with them. Since it is a safe and private conversation, it helps you get better details about an issue.
eNPS (employee Net Promoter score) is one of the simplest yet effective ways to assess your employee's opinion of your company. It includes one intriguing question that gauges loyalty. An example of eNPS questions include: How likely are you to recommend our company to others? Employees respond to the eNPS survey on a scale of 1-10, where 10 denotes they are ‘highly likely’ to recommend the company and 1 signifies they are ‘highly unlikely’ to recommend it.
