What your SMB partners REALLY think of your MDF program

“MDF is a pain in the neck.”

We hear this from partners, especially the long-tail, SMB partners all the time. But why do they get frustrated by your funding?  Shouldn’t they LOVE it?  After all, it’s a windfall/financial injection for their business that drives new revenue for THEM. But the reality is that it’s not always viewed positively. Sometimes it’s just a “pain in the neck.” How do you know if your MDF program is causing stress? 

Consider this… 

•  If your current MDF program requires your SMB partners to stop selling in order to perform administrative tasks to implement marketing campaigns, it might be a “pain in the neck”. 
•  If you are competing for your partners’ attention with continuous communication, cajoling them to participate and report, your MDF program might be a “pain in the neck.”
•  If you find that you’re always helping your partners to “use up” their MDF in the last couple of weeks of the quarter, your MDF program might be a “pain in the neck.” 

Should you care about the experience of your SMB partners? 

Absolutely!  The opportunity is massive. Steven Kiernan, Global VP at Canalys shared that in a recent Canalys report of the SMB market in North America, vendors “should not neglect small regional partners that work with SMB customers. This segment represents a significant channel growth opportunity for vendors due to its sheer size. There are an estimated 7.05M businesses that fall into this category, or 98.2% of a total 7.12 businesses.” 

So how do you make the experience better? 

Here’s why your partners don’t love your MDF program, followed by what you can do about it.

1. Partners lack the internal marketing resources to execute marketing programs. Ninety percent of partners are SMBs, and 84% of them lack dedicated internal marketing resources. Even when vendors provide marketing agencies, partners still have to meet with the agencies, engage, and participate in campaigns. Many partners just don’t have the bandwidth.
2. Your MDF isn’t the only game in town. Most partners sell products and services from multiple suppliers/vendors, with many of them offering up MDF.  Think about it from your partner’s point of view…. They have MDF from multiple vendors with different rules, often with different agencies with which to work, and they have different processes for reporting back.  Large partners often have a full-time employee whose sole responsibility is managing vendor MDF programs. For the SMB partners, it’s simply overwhelming, and they often just pass on it.
3. Your MDF is rigid and doesn’t meet their modern marketing needs. Your MDF programs have guidelines – which is fine – but sometimes your partners have ideas that may not conform. Events, lunch and learns, and trade shows are becoming less important, while digital marketing – like search marketing and paid digital ads – are becoming more desirable. If your MDF program doesn’t allow modern marketing options, it’s difficult for partners.
4. Your MDF is too short-term focused.  If you provide MDF on a quarterly use-it-or-lose-it basis, your partners may find it difficult to use altogether. Many meaningful activities require time to set up, and time to gather momentum. If you’re always pushing disparate, short-term activities, your partners might give up.

“I wish they’d use the MDF and do it for me.”

SMB partners have told us that they want their vendors to utilize the MDF on their behalf, and we have to say that it makes a lot of sense. Jay McBain, Chief Analyst at Canalys has reported that at least two-thirds of partners fall into the “do it for me” camp. Manufacturers and distributors have larger marketing teams with resources that are already creating marketing content. Taking that one step further and executing campaigns is the next logical step to support their SMB partners.

Do it with Through-Channel Marketing

1. Partners don’t need internal marketing resources to benefit.  Once the partners have joined the program, their work is done. The vendor/distributor marketing campaigns are automatically launched in market, driving leads and/or conversion to partners.
2. Your MDF program rises to the top of the list. With no complicated program to manage, partners appreciate the value of your MDF program, compared to other vendors’ funding.  Studies show that partners appreciate the investment they believe that their vendors make in them via Through-Channel Marketing programs, which drives partner loyalty.
3. Your MDF program can be the modern, digital solution your partners want and need. Partners know that the buying journey has changed. They know that companies that have made the digital shift are more successful than those that have not. Through-Channel marketing delivers the digital solution that helps them to be found online, increase their own digital maturity, and demonstrate more credibility – without the heavy lifting on their own.
4. Your MDF program becomes a long-term commitment with measurable quarterly results.  Through-Channel Marketing is an annual program that measures quarterly, annual, and even longer-term results. The beauty of TCM is the integration of all of the various components that work together to improve short-term metrics, while at the same time, helping the partners to build an online audience over time.   
5. Your partners get more. A typical Through-Channel Marketing program delivers over $60k of value to each partner for a tiny fraction of the cost. Because you are delivering value at scale, you can get more for your budget, and give more value to your partners.

Re-allocate existing budgets for better returns.

Re-allocating just a portion of your direct MDF funding to a Through-Channel Marketing program can alleviate the burden that partners associate with MDF programs, and it can deliver higher returns across a much broader spectrum of partners, including the long-tail.

If you want to learn more about Through-Channel marketing, this video provides a high-level overview. If you are interested in exploring what the ROI on a TCM investment for your business could be, this blog gives a high-level explanation. Contact us directly to see what the return could be for you with our TCM aaS ROI calculator. 

And stop being a pain in the neck. 

AscendX Digital Inc. is the first and only TCM-as-a-Service marketing provider and the only company with a revenue-generating model for distributors. Instead of spinning up a new product in your MarTech stack and putting more pressure on your marketing teams, consider looking at the outcomes of TCM and engaging as-a-Service. When you do, you can deliver a solution to market months faster, pay only for what you use, drive better partner and customer experiences, and reduce your risk. 

Our team has many decades of technology marketing expertise, and we work with vendors and SMB partners every day. Whether you have a TCMA investment that needs some strategic and/or operational support, or if you are looking for a fully managed as-a-service solution, AscendX Digital can help.