Examining the Impact of Inbound Marketing on Manufacturers and Their Channel Partners
This comprehensive whitepaper contains extensive information on how a Partner Relationship Management (PRM) system can support channel managers, including topics such as:
The accelerating transition from traditional outbound marketing techniques to inbound marketing strategies is driving the need for manufacturers to reconsider their roles in the lead development and lead management processes. In addition, the systems that support dealers must be reexamined to support modern marketing strategies for manufacturers who sell predominately through indirect sales channel partners.
New customer acquisition is the lifeblood of most businesses. Sales lead development starts the process. But who should develop leads these days? Traditionally, dealers (though they take many forms, we will refer to all types of indirect channel partners as “dealers” for simplicity purposes in this White Paper) have been primarily responsible for developing leads locally. They still are in most cases. This has been largely driven by traditional buyer behavior. Up until recently, buyers relied on salespeople to learn about products and their applicability in solving problems for the buyer. The more complex the product, the more this has been true.
However, buyer behavior has changed dramatically as a result of the ubiquity of information. Today, buyers research a remedy to a business problem themselves once they realize they need a solution. They don’t think of salespeople as the primary source of information anymore; they rely on information on the internet as the primary source of information. They don’t want to talk to a salesperson right away. Once they are close to buying, then they engage with a salesperson.
Since the buying process has changed dramatically, so too must the marketing process that supports the sales process. If buyers are doing their own research before they choose to buy, manufacturers now must position themselves as the leading authority on solving the buyers’ problems. This positioning forms the basis for the development of an inbound marketing strategy. More significantly, it shifts the responsibility of who is responsible for generating inbound leads from the dealers to the manufacturer.
That’s why it’s essential for manufacturers to use a blend of inbound and outbound marketing strategies in order to effectively market to today’s buyer. In this blended approach, you can educate your customer with inbound marketing (more on this in a moment) then close the sale using traditional outbound techniques. But why do we need a blended approach? Quite simply, because the roles of dealers and manufacturers have changed along with the industry.
In the past, and some today, manufacturers relied on dealers to build a customer base in local markets and act as an inventory showroom or warehouse. As part of growing the local markets, dealers would be responsible for obtaining leads and manufacturers would subsidize their local marketing efforts with MDF or co-op dollars. As inbound marketing has taken hold, manufacturers have gained the ability – and responsibility - to gather leads and funnel them downstream to dealers.
What led to these changes? One of the biggest impacts has come from technology and the internet. The internet has given buyers access to information they used to have to get from local dealers and technology – in the form of smartphones, tablet computers and highly-portable laptops – can keep buyers connected anytime, anywhere.
Who is best positioned to drive the inbound strategy? Not the dealers! In most cases, it doesn’t make sense for dealers to develop inbound strategies at their level. Developing an inbound strategy, and more importantly - sustaining it - is a tough challenge. Centralization of the inbound marketing strategy at the manufacturer’s level makes the most sense based on the investments that typically have to be made in an inbound strategy to do it right. Oftentimes, MDF funds and budgets are reallocated to fund new inbound strategies.
It’s important to examine your organization and answer a few key questions as you begin to redesign your lead management process around an inbound strategy. If you take the time to evaluate your current process, assess its effectiveness at each part of your lead-management process, you’ll have a much better indication of what you’re doing right, where you could improve, and what practices you should redesign.
Seven Questions to Consider:
Each of these questions is tied to the rest, but the first three –where leads come from, what campaigns you currently run, and the flow of leads – set the baseline for the issue of changing roles. It’s these three that must be redefined as you adopt an inbound strategy that’s right for your company.
The final four questions on the list concern the process flow for leads once they’ve been captured. This process includes transferring leads to the right dealer who can handle it best, receiving feedback and measuring the success of each phase of the sales cycle, and ensuring dealers are not competing for the same business. A PRM system properly designed to address these issues can drive the process without requiring dealers to put everyone on the same CRM platform.
You now have the ability to deliver leads downstream as a result of your inbound marketing efforts! By doing this, you’re not only making it easier for your sales team to close deals and turn new leads into new customers, you’re also making it easier for others to do business with you while also helping them grow their business. This incentivizes dealers to work harder on your behalf while increasing mindshare of your brand.
Without a process in place for claiming ownership of leads, channel conflict emerges which can lead to price erosion, jeopardize brand image, and impact the motivation and morale of your sales team.
Having the proper system in place that easily allows dealers’ sales people to register leads they uncover makes it easier for the dealers and their salespeople to do business with the manufacturer. Properly designed, the process and the business rules within it make it easier for salespeople to register leads and assign ownership fairly.
Lead registration and management is a critical function of a good Partner Relationship Management (PRM) system. A well-designed PRM system allows for a bi-directional flow of information between sales partners and manufacturers, keeping everyone engaged in the sales process.
Management structure and business rules must be defined such that there is clear accountability for registering and managing lead flow. This could be a system where sales staff is responsible for registering inbound leads pending the approval of management (bottom up). Conversely, it could be a system where leads are funneled to a manager who then distributes them to sales representatives based on a geographic or intellectual territory, by industry, through a bullpen-like rotation or via an alternate method (top down).
An example of how the appropriate system can introduce efficiency is by utilizing your customer data in the right way to organize and coordinate the efforts of your marketing and sales teams and ensuring they reach the right people within the sales channel. Say a customer leases capital equipment to their clients. With the proper system, the sales and marketing team can coordinate their efforts to target customers with leases that are nearing expiration; ones whose companies are growing and have need for more equipment; others who may be using outdated equipment and are targets for upsells; and still others who are steady, reliable clients but may need an extra touch from their sales representative to maintain the relationship.
In order to better manage the top of the sales funnel and introduce more efficiency by limiting channel conflict, it may be time to align dealer support systems with the redesigned lead management process. Current CRM software may not meet your needs in that claiming or assigning leads to independent dealers builds in an extra step - one that exists solely outside the CRM - unless you want to buy hundreds or thousands of additional CRM licenses for your dealers’ salespeople. Most of today’s systems employed by manufacturers and dealers are based on the assumption that leads are generated by traditional outbound sales activities driven by the dealers. Leading Partner Relationship Management (PRM) systems on the other hand, are designed to support lead registration, approval and tracking across the dealer network, regardless of the array of CRMs that the dealers employ (often in many flavors).
Transitioning to the right inbound/outbound marketing mix does not happen overnight. It’s important to adopt best practices and redesign the process in a way that leads to success while not being too disruptive to current lead flow with your dealers. The following process can help lead you to a modern marketing approach that blends new inbound techniques in a way that magnifies outbound techniques used by your dealers:
LogicBay provides technology-enabled Partner Relationship Management (PRM) solutions and the cloud-based Performance Center™ partner portal technology, enabling organizations to support, develop and manage their extended enterprise. Performance Center™ technology focuses on the key elements of partner and employee engagement, management and development. Integrated functions include collaboration, marketing and communications, training and certification, and performance management. For additional information, visit www.logicbay.com or email us at firstname.lastname@example.org.
©Copyright 2014. LogicBay Corporation.All rights reserved