What is up PartnerUp!
James Hodgkinson, SVP, Ecosystems at 360insights.com, joins the show to discuss the differences and similarities between channel and nearbound. James, Jared, and Isaac talk about the definition of channel vs. that of nearbound and explain how ecosystem as a final state plays into that understanding and dynamic.
They discuss how software sales has gone from buying through a third party, to direct, to being influenced by a third party, and Isaac shares how his recent experience with a moving company has informed his view of ecosystems.
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Highlights:
- Intro to partner up. 0:05
- Back on the content train this week.
- James hodgkinson from 360 insights joins the podcast.
- The transition from channel to ecosystem. 1:32
- James talks about the converging world of channel and ecosystems.
- What 2023 means to him.
- 70% of all revenue in technology goes indirect.
- The difference between channel and ecosystem.
- The difference between ecosystem strategy and channel strategy. 5:48
- The difference between channel and ecosystem strategy.
- The next opportunity for all businesses.
- Jared and James discuss the definition of an ecosystem.
- The collision of two sides of the same coin.
- Channel partners are the real deal.
- How go-to-market is changing, and why it matters.
- Strategies for building and scaling an ecosystem. 12:59
- Building and scaling an ecosystem at 360.
- The convergence point in the industry.
- Transitioning from SaaS to B2B technology companies.
- Trifurcation of the channel.
- The 10 macro trends that are facilitating the channel world.
- The biggest shift in channel.
- Direct to consumer vs. cloud computing. 19:14
- B2B vs B2C, direct vs indirect sales.
- B2C vs b2c channel partnerships.
- The evolution of the consumer world.
- The future of direct-to-consumer
- Shifting from transaction to influence. 24:07
- The role of a partner is shifting from transaction to influence.
- B2B is seeing the same shift.
- Fulfillment layer of the stack. 26:45
- Amazon as a place for fulfillment, not discovery.
- Hybrid landscape of B2B
- Another company shows up to rent a truck.
- The messy side of PRM architecture.
- But no it’s your brand. 32:16
- The winning formula for the ecosystem and channel businesses of the future.
- Why broken experiences are frustrating.
- First principles, simple, not easy, but complex.
- Hbo max rebrand from HBO max to max.
- Difficulties of creating a seamless experience. 36:31
- The added layer of difficulty.
- The constant process of bundling and unbundling.
- Technology needs to be able to change all the time. 37:57
- Technology has to be able to change all the time.
- Keeping up with the ecosystem.
- The collision of channel and partnerships. 39:35
- The collision of channel and partnerships.
- Partner up with Jared Robin.
Full transcript:
Jared Fuller 0:05
All right, what is up, partner up? We're back. I'm feeling fresh this week. We're back on the content train like we should be Isaac to podcast this week. We're not missing another week in throwing, throwing an event back in the mix. We're getting a new episode out to everyone every single week every Tuesday. Feel Good. How are you feeling? Man?
Isaac Morehouse 0:23
I'm feeling pretty good, man.
Jared Fuller 0:25
Did you get in your kayak yesterday?
Isaac Morehouse 0:27
I did. Yeah. It's, it's really not a kayak. It's like a baby kayak. I was like, I want one that will fit in the trunk of my car just so I can paddle for like 20 minutes. When I'm on my way home, pull off the bridge. So I got this thing like Dick's sports. And I didn't notice till afterwards. It says weight limit 140 pounds. Is that you bought the kid would? So it's like, it's called a minnow. So I'm in this thing. And I'm like, 175 180. So I mean this thing and like, it's awesome. It's just, it's, it's a little lower.
Jared Fuller 1:02
You got about an inch between you in the water. Yeah, it's a little lower
Isaac Morehouse 1:05
in the water than it's supposed to, you know, oh, my gosh, oh, my gosh.
Jared Fuller 1:09
Well, it was it was fun having you in person in the office this week. So happy to have you here. For those folks that don't know, Isaac's moved out to the area. And joined by a guest today, I'm actually really excited to who just recently we met up in the St. Pete area. James Hodgkinson from 360 insights. So a fellow entrepreneur, that's helping lead the change. James, welcome to partner up.
James Hodgkinson 1:32
Hey, great to be here.
Jared Fuller 1:33
Thanks for having me. Of course, of course, it was great meeting you in person a few weeks back. And just catching up for a good amount of time on all things kind of happening on this kind of the topic today, the converging world of like, near bound and channel or the transition from channel to ecosystems and where these two point of views are coming from, as we recognize in our conversation that was very interesting, is that I was approaching it from probably a very different point of view, reveal up data up, SAS up, you know, like, how do we make SAS organizations are direct sales driven organizations that are reliant on outbound and inbound adopt near balance, right, where their sellers are working with partners, and then you are kind of approaching at it from like, the channel enterprise distribution layer of like, the experiences for how these people work together, or garbage. And that's kind of what we're gonna talk about today. Because I feel like we're in a lot of the same watering holes, partner, people, channel people, right, and, you know, orienting near bound and partnerships, all this stuff, ecosystems, right, there. Is this convergence happening, where a lot of our conversations seems like we're talking about the same stuff, different stuff. Let's unpack that today. James, what's so interesting about 2023 to you, in this converging world of channel the ecosystem?
James Hodgkinson 2:49
Yeah, it is a, it's a really interesting time. I mean, I, I came up through, you know, the very beginnings of channel technology, because I, as a bedroom business got hired very early on to build some very complex systems for software companies to help them you know, with their channel sales systems, really, and I mean, aside from the fact that that was crazy for a company of that size to work with a company in my size, it was, it was a great apprenticeship and learning what was all this about. So, you know, I got early in my 20s, out to building solutions to things I do registration and part of funds management, and POS recognition systems and partner portals and all of this stuff. But what I realized a lot of that was about the machinery of selling indirects, you know, because you had, you know, big, big networks that were established around a fairly small number of very big companies who would have distribution partners and agency partners, you know, so there's a, you know, a little known fact is 70% of all the revenue in technology goes indirect, you know, it's not going direct from the manufacturer, it's going through networks at some kind. So there was a whole series of technologies, people, tooling, everything that built, built around the channel. And there's been, you know, a lot of companies who then grew and matured in that space, PRM companies, partner, marketing companies, all these kinds of specialist tools. But it was always, you know, sort of a silo in a business, you know, the channel organization was kind of working in parallel to the direct, there was often conflict between the sales team and the partner teams. And so all of this was playing out over the last period. But now what we're seeing as we move into the new era, and the kinds of things you guys are talking about every day is channel isn't some thing that just big businesses do ecosystem is becoming, you know, potentially the go to market strategy for businesses of every single size. And the companies that are working channels are still gonna have to do that, but it's becoming subordinate, in some senses to the overall ecosystem opportunity. And I think the companies that understand this is all one thing and we're all trying to achieve the same objectives. You know, we're gonna get there quicker because they aren't too different, you know, two different business models. This is just a convergence point we're living through right now. So that's Where I think there's a lot of, you know, there's a lot of opportunity to sort of converge these kinds of thought processes and speed up this transition. Because a lot of what the channel was built for traditionally is legacy, you know, we don't ship physical products anymore to the same extent we don't have. We don't need all these different intermediate, intermediate three partners, but we do need channels have different nature. Now, that's what we're living through.
Isaac Morehouse 5:22
So I'm going to ask a really difficult question for both of you, or either of you. That that, you know, like we talk about this a lot. Yeah, channel and ecosystem is different. Give me the definition. What is what is ecosystem compared to channel? What does that mean for like, channel? I feel like it's fairly easy to define. How do you define ecosystem?
Jared Fuller 5:48
I might interrupt you just a reframe that Isaac, I wouldn't contrast channel and ecosystem. I might actually contrast I might trust channel and near bound. I think ecosystem is a more emergent final state that you're working towards, for example. But I would say in terms of a strategy, there is no, the ecosystem strategy is much more emergent than people think is designed. Like the ecosystem is probabilistic. That's the payoff through like an app platform like the customers that ended up making stripe, the most money, right? So stripe being platform first. It maybe that's the way to think about ecosystems, this a little bit more amorphous, but I would say channel near bound or like platform, those would be the very different framings of it. So I could go through that. But James, I'd love to hear your your thought process of like, what's the difference between this a channel and near Boughner? Channel and partnerships, where what is coming together?
James Hodgkinson 6:47
Yeah, I mean, some people are telling you, that ecosystem is just a new word for channel. And we've always been doing ecosystem. But the biggest shift for me is, like I said, I think channel is more about the mechanics of indirect selling, and the very predictable motions that go along with that, you know, like registering deals, paying MDF, dollars, all of that stuff that traditionally has been baked into large software and, you know, other types of organizations, ecosystem for me and near bound is a part of that is, is a shift as a complete shift of business strategy that says, you know, what we're going to do is actually grow support cell service, everything we do as a business is going to be driven through our ecosystem. And, you know, that's our primary go to market strategy, not that we have 90%, focus on our direct sales and marketing. And then we, you know, throw channel partners or bone when we need to fulfill these deals outside of our company. It's trying to build an organization as I'm doing it 360 That is ecosystem first, strategically, and then, you know, near bound and the methodology to do that, and the systems and the tools to do it become, you know, all part of that, that strategy, I think, and for me, it's not about big businesses. I mean, I think any startup now needs to begin with that mindset to say, how can we leverage this because the old ways aren't working, you know, the direct sales and marketing impact is going down every day as people get saturated. So what I loved about nearby near bound, and much of what you know, you guys have been advocating for in the last couple of years is this is a whole smarter, better way to, to grow a business and to support the needs of your customers, you know, if you have that baked into your company, that's not channel that that's, that's, that's the next opportunity for all businesses. I think,
Isaac Morehouse 8:29
Jared, as you're talking your cutter made me think. Because I always need like, really simple analogies. And talking about ecosystem as almost like an end state that you're trying to get to you want. Yeah, right. Like, like an ecosystem is like, it's like an environment that you live in. And you want your product to live in one and two, and to have one have an orbit around it. And so you think in like, where's the term ecosystem come from, from nature from ecology, that you have a certain ecosystem? But the question of how do you get that there's different strategies, you can have rotational farming, you can have permaculture you can write, those are strategies for getting to that end state. You want to get to a thriving, harmonious ecosystem where everything's symbiotic. But there's strategies and tactics that you use to get there. And that's maybe kind of what you're talking about is like near bound and channel are both different types of tactics. There's been
Jared Fuller 9:25
some a handful of folks that are like, Oh, there's the language is too confusing. And I'm like, yeah, it's always been confusing part. Go talk to your CRO and your cmo and your CCO right now and say, Please define partnerships at our company, and you are going to be terrified at the answer that you get, like you, you will be, I promise you're not, you're not gonna walk out of that and be like, oh, shoot, we're all on the same page. We're gonna crush it, you're gonna be like, I cannot believe that my cmo that I have a meeting with every week has a polar opposite number. To my definition to my CRO, for example, Isaac. So like, it does Didn't matter that there's more words, and we're talking what's channel was partnerships, when nearby was ecosystem, I think, I think having an understanding that there are differences is actually important, because other people see differences. It's like when you like, for example, if you come from a channel background, and then you come into a SaaS company, and they have partnerships, and you don't recognize that these are kind of coming from different places, but you assume the same path forward, you're gonna be in for a world of hurt, right? These These, these words do matter, they matter a lot. And I think James, like this collision, or convergence of two sides of the same coin is is very fascinating to me that, you know, four years ago, James, you and I probably would have been like, oh, we, you know, we're kind of talking about different things. But now we're talking about very similar things is that Isaac, to answer your question channel was built for a world where partners came to you. So there was a function in the business, and you go out and you secure partnerships, and they might, they're gonna have something more material baked in, like how this distribution actually happens. I want to call something out about channel, people that can secure channel partners are the real deal. Like, have you ever looked at a channel person and been like, no, there's Yeah, they don't know what they're talking about. And you're in partnerships. No, you don't know what you're talking about. Like, typically, with a channel deal, there's an expectation on distribution. So that means that in the operating model, there's a different line item for everything associated with the recruitment of those partners, the sales of those partners, the marketing, the the retention, or services, it's because this is a more sophisticated way to write do distribution. And it was based on how distribution was generally done in these types of purchases, right? A lot of it comes from telco from it, from places where you needed a big PBX system installed in a building and how everyone communicated was on the phone. Right? Like, you need that local presence of a partner to install that hardware, all the way up to you know, software packaging, and you know, et cetera. The point is, is that it was a world where you build partnerships, so that way, they would come to you over the long term. And what I would say is fundamentally different about near bound, or partnerships, or, you know, like more modern approach, it's a world where you activate partners, so that way, the rest of your company can go to those partners. And it's like, well, that's different. That's, that's kind of the opposite. So that marketing can engage in do co marketing with these partner relationships that you developed, and you're developing it. So account executives can have their inbound accounts, their outbound accounts, in their gear bound accounts, they work specific accounts with partners as part of their strategy. So that would be my it's, and then what's changed? Well, all of go to market changing, distribution is changing. Everything's changing. And we're both coming to the realization that like, okay, partnerships can't be a department in SAS channel can't be a business unit and traditional businesses, there needs to be something where direct and indirect are working. We're singing from the same sheet of music.
James Hodgkinson 12:59
I exactly. I couldn't agree more. And I think I think what's interesting is, because these of, you know, you've got this convergence point. And we're living through that right now. It's almost easier when you're starting from in a new world context, like, for example, I'm putting together the strategy to really go and build and scale our ecosystem at 360. And we don't really have, you know, a lot of legacy motions to sort out, we haven't got like highly mature resale programs or distribution partners, or anything of that nature. So we're looking at it saying right from, from where we are today, and what we need to try to do, how do we build that ecosystem? First, near bounce strategy into the existing functions of the business to your point, you know, so how are we working, you know, to support the needs of our existing sales teams and marketing teams? How is product and engineering informed by partner integration and the strategy around it, but it isn't just for new companies and SaaS companies, what I'm talking to a lot of my, my customers about the big enterprises, is that actually, they need to start to do do this transition, but not break what isn't, it doesn't need the attention. So for example, if you've got a highly mature resale program, with, you know, traditional resellers who were stills installing software in somebody's physical location, you know, some people even don't want to sell cloud, a lot of traditional partners are still stuck on the revenue, you know, of on premise solutions. You can't mess that up, because that might be 80 90% of the current revenue in the business. So what you've got to say is, we need an ecosystem strategy that recognizes the motion. So how do we continue to support and deliver for our resale partners who are you know, revenue generating and still living in the old world, but start to give them a path to the next stage of our journey, which might be migration from cloud to on prem. But at the same time, let's start lighting up the New World opportunities around marketplaces and integration partners and ISVs. And so you have to kind of do it all but I think one of the problems at the moment is the large enterprise Eyes is still stuck in the traditional channel, because it's so much of the revenue, that they're missing the opportunities to really embrace near bound as a strategy. And it's gonna take time I think for that to happen, I think where we're trying to speed it along is a is a technology provider, you know, that's really working with big enterprises that can show them a path strategically and through tech execution to make that transition more more rapidly. Because it isn't actually, you know, going to be something you can you can ignore for too long as the as the, you know, the go to market is changing quickly, as you say,
Jared Fuller 15:32
many of the follow on to that. Like, I could highlight what I feel like is the change for startups and SAS native companies, they got addicted to cheap customer acquisition, right. So they, they, their CAC, LTV calculation was predicated on cheap customer acquisition cost, right. Irrespective of, you know, the closest path to the customer was like, the closest path to the customer was Google, know, Facebook, like you reach anyone, anywhere, anytime for cheap. And now it's like, yeah, that's so cheap anymore. And it doesn't work as much anymore. So today, James, I think it's very clear of like, why SAS companies might have accelerated to the forefront of, let's say, the tech conversation, right? Like, there's more ISVs that have a SaaS model now today, in terms of b2b technology companies, right? Obviously, if you can include CPG, and the rest of distribution in the world, like, still largely indirect, but in terms of b2b I, more technology companies are SAS based than not now. But now they've hit a stopping point. It's like whoa, mass layoffs, markets cooled off. A lot of these companies are going to have a hard time making it to the same place they thought they were going from a channel perspective. What do you I think Jay McBain is trifurcation of the channel that he wrote, you know, three or four years ago was pretty close. But what do you think is the change that's happening right now, from your vantage point inside of channel? Like, it's very clear to me to cheap customer acquisition costs, the thing that's killing SAS companies right now, it's like, that's not there anymore. You have to figure out partnerships. What's that same impetus from the channel world? I could describe, like 10, I think macro kind of trends that are making it happen, or is there something really fundamental you feel like that's, that's facilitating this in the channel world,
James Hodgkinson 17:15
the thing you touched on around the the collapse in tech, and that valuation paradigm has shifted across all businesses very, very quickly. So all of a sudden, it was, you know, it used to be kind of growth at all costs is the only metric anybody's, you know, measuring so spend as much money on sales, marketing, etc, as you wanted to. And obviously, there was an impact across all of the you know, whether or not there's a big enterprises had a mature channel or a high growth startup, suddenly, it was you've got to now change that valuation metric to less fixed cost, less op X, you know, more scalability, more margin, that kind of stuff. So the channel businesses that are out there, they, you know, they were basically caught up in that same paradigm. So all of a sudden, the reliance on partners is increased to some extent, but actually not transacting on partnerships as much because there's, we're seeing, like, you know, and I think this was another Jamie, at Bain stat. It used to be maybe a big company would do 70%, resale through partners that might reduce in terms of the transactional side of it to 30% 30% maybe goes through marketplaces, 30% goes direct. So the channel is just being it's being reimagined to something else. So this is what I was saying about the speeding up, it's like, let's move from the traditional channel mechanics. But let's use the ecosystem of partners, to start to start to transition more quickly to a more effective business strategy, which actually is, is meeting these new valuation paradigms more effectively. And I think that's a great thing, in a way in terms of speeding up the movement towards an ecosystem led approach versus a traditional legacy channel approach. So I would say it's just chain, you know, forcing channel businesses to, you know, to transition to something beyond that legacy model more more rapidly. That's the biggest shift I'm seeing, but it's connected to the same market forces we've seen in direct and SAS businesses.
Isaac Morehouse 19:14
Yeah, it's almost it's almost like I'm hearing that there's there's something happening from both directions, where you used to have to buy software through a third party for the most part, like that was pretty much the only way it was done. Then you were able to buy it direct with cloud computing all this stuff. So now you have this option. But all the companies that to Jarrett's point, the early you know sort of SAS startups that are like cool, we're going all in on direct because now customers can buy direct, that became over overwhelming and so you have this thing where buyers it's like, I used to not have the option. Then I had the option and I mostly bought direct or maybe in some areas, but now the direct is overwhelming. Instead of here is the phrase I'm looking for Are you used to buy through third parties? Now you buy because of third parties. So it may be through them. But it may it may be direct, you don't really care, but you're buying based on trust you have with a third party, right? You're not buying direct, because of what the relationship you directly have with the vendor. You're buying direct or indirect, because of other other relationships that surround that vendor, if that makes sense. Does that does that connect Jared, you look like? That's not really that's not really landing? I'm trying I'm learning out loud here.
Jared Fuller 20:37
I'm actually taking notes. Because it's right to some it's right to some degree, I wouldn't disagree. What I would say is, I was I was almost looking for the consumer analogy. Right? Like it, we're talking in a b2b tech space. But ironically, a lot of the b2b tech companies that serve let's say, channel use cases, oftentimes their end customers or what b2c, right, a lot of channel partnerships are in that same kind of direction mean, the end product is sold to a consumer, not another business. And that's material, if you look at, let's just say the automotive automotive industry, right, there is some channel relationship between Ford and Michelin or Goodyear, right? That says that that would fit into that motion, someone owns that relationship, they're going to do this many cars on this mini thing, and then it's sold to an end consumer is very different than that being sold to another business. So I think looking at the lens of like, how that business changes happen is helpful, but I was actually just kind of geeking out in my, in my head when I was taking some notes here, Isaac, about what happened with consumer world, like just how we shop does like his people straight up people. It was, first first there was what everything was, you know, individualized, like local store, that's all that mattered then there were supermarkets, supermarkets, Walmart, it was like, shoot, I can get a brand of everything that allowed for brands to kind of like flourish individually. Like if you ever bought stuff for your kids, you know, like Little Tykes, right. You know, like a lot of those childhood brands to like flourish inside of the stores. And then everything kind of went online to Amazon. So it's like the first on prem right to cloud Amazon. And then that was the first winner and then what happened direct to consumer right there was a period there where like we weren't doing a lot of our shopping on Amazon if we don't recall it was like oh my gosh, I can buy this direct oh my gosh, I can buy this direct because you couldn't those products weren't didn't have access yet. Now all of those DTC companies, are they doing well? No, they're getting there. Looking at all of the DTC companies, every single DTC company that was like, darling child like Casper, right, purple peloton, like these, these brands that have traditionally had a channel kind of like, here's a store. They're eating it in the market right now. And what's happening though? Well, the brands that are actually doing very well and how we buy how are they getting distribution, through influence through influencers? Its Instagram, its Tik Tok. Its YouTube, right? They're advertising on podcast. They're they're still kind of going direct. But they're, they're not just advertising on Google. They're going through influential things. And they're launching on Amazon, right? They actually have an Amazon store. So that consumer brand that was direct to consumer, they're going through influential circles, they're working in a marketplace fashion. They're kind of they're multipolar right? They have multiple strategies. Those are the consumer companies that are doing good but do you think peloton would have launched on Amazon the peloton store a year and a half ago? Absolutely not. I wonder if there is a peloton store on Amazon. I'll go look right now. But can you bet your butt someone's thinking about that at peloton? If not. So that's kind of the in the business seems like we're just a little bit behind James. They have that same beat a secret DTC transformation. It's like that's kind of where b2b is coming right up on that same one?
James Hodgkinson 24:07
Well, yeah, absolutely. And I think I think going back to what we said about the role of a partner, it's shifting from the transaction to the influence is really important because it used to be from what I observed in the beginning of like working with some of these big channel first companies, actually, most of the sales and marketing was still coming direct from the organization, but then the fulfillment was going through. So I even it would get to the point where you were like, and you look at this with like, traditional partner locators, or whatever it be, I want to buy this, the company has convinced me now I've got to find a partner who can sell it to me to fulfill the transaction and the shipping without any relationship with that partner whatsoever, right. That's how it used to be. It's almost flipped the other way around now where the transaction might be done somewhere else like on the AWS Marketplace, because I can buy it cheaper there than if I go direct. But the partner is the one who's potentially the trusted adviser who has helped me get to the way of fulfilling that purchase on someone else's marketplace, right. So that shift is very similar to what you just described in a b2b context. But the way that you have to attribute influence them and connect the dots around, all of that is more nuanced, because you don't have an end transaction outcome that you used to have that says this partner did this amount of revenue. So this is where, you know, again, things like consensus play a big role. This is a big part of what we're focused on a 360s How do you start to drive non traction transactional behavior and almost like create influences in the partner community who are the equivalent of the, you know, the Instagram crowd for consumer who were the ones who will lead Volume and Volume of customers to tech solutions to you know, to cool products or that kind of stuff? So b2b is seeing the same shift, it's just behind and the tooling for it is just not always, you know, good enough basically, when it comes to the systems,
Jared Fuller 25:53
right, and the experience that you know, the heavy hitters by want to be able to orchestrate for their ecosystem so like the, the the makeup places, the marketplaces, owners, the ecosystem, you know, parents so to speak, they have a harder challenge at hand to be able to orchestrate that experience in a way that we've come to expect from like an Amazon right? Like that experience is so easy and it just like we know how to use it that like so I mentioned peloton, so I just went to Amazon and I looked to guess what? peloton launch so I'm like, would have peloton done this? A year and a half ago and I'm like, oh, shoot, maybe they were on Amazon the whole time and I'm just like making stuff up on this podcast. They launched at the end of the year last year in 2022. This drew DTC company b2b SaaS, direct to comm we only work directly with the customer. It's like even the DTC kings have been like, actually terrible idea. We need to go to the marketplaces, we need to go to the influence.
Isaac Morehouse 26:45
It's funny Jared because as a customer, I don't even think of Amazon as a place for discovery. I only think of them as a place for fulfillment really just one click checkout and shipping. So like I will Google something like if I wanted a peloton, I would Google peloton, and then the results would come up and I would click on the Amazon one above the other ones because I know the checkout and shipping process is the easiest, I don't care about any of the other stuff, right? So like, in a way, they're playing that layer of the stack and like peloton is kind of direct to consumer. That's how I've heard about them, not because of Amazon. But Amazon is almost like the fulfillment layer.
James Hodgkinson 27:24
I can and it's interesting, I can see some really good parallels with this as what's emerging with, you know, successful ecosystem strategies. So So for example, I did a webinar a few weeks ago with someone from Trend Micro luego, great channel leader who had built out a whole strategy around trend on to AWS and done the equivalent what you're describing on peloton where it's, you know, a whole store massive lead generation, huge amount of sales velocity generated through that investment in hyper scalar. But not having the ego, like the vendor ego, they used to have to say, you know, the world all is built around us, you know, because this is the traditional channel, it goes back to your point that this was the expectation from the vendors, which is why the tooling often was terrible, as well as like, you have to come here to order product from us, you have to come here to register deals, you know, it was kind of like, we're the center of that universe. Now the vendors that are the smart ones, at least are starting to realize that working through ecosystems where there's aggregated buyers and centralized products and solutions that are developing, and b2b is going to be way more effective than expecting, you know, organizations to transact in 15 or 20 different ways. So we're, we're seeing the exact same analogy in in b2b. And I feel like these kinds of where the transaction happens, that isn't the important piece anymore, when it comes to influences, you know, that's just fulfillment at the end of the day. So we, you know, we're seeing a lot of interesting shifts there very, very much in real time.
Isaac Morehouse 28:53
So I want to talk about maybe as this kind of hybrid landscape is emerging, where you have like a direct, but you also have this kind of channel and partnerships, and these things are kind of merging. How to do that? Well, because there's a lot of ways to do it badly. And I'm gonna give you an example. This is just an excuse for me to rant about my moving company experience. We moved recently, and we, we hired a moving company, and my wife found them. So however, she found them, right, maybe it was word of mouth. Maybe it was Google, I actually don't know. But it was like a company with a brand. They had a name. I don't even remember what it was. And she like goes through their things. So you feel like this is a direct thing, right? She goes and books them. And then we have you know, somebody shows up driving a truck that has one of the truck company names on it, like, you know, whatever the Penske or something,
Jared Fuller 29:43
Penske, right. It's like I didn't hire Penske. But I guess Yeah, rent truck. I guess I could have rented a Penske too.
Isaac Morehouse 29:48
But the guy driving the truck didn't work for Penske or the moving company. He worked for some other company that the moving company goes and says, Hey, we've got this job who wants to bid on it? They bid on it. He gets his guys to rent a truck from Another company, they show up, his guys hire other guys to help him through Craigslist, who show up to load the truck. When they're delivering it, then they store it at a warehouse with some other company when they deliver it here. So anyway, it's another company here, by the time we're done, because they did a bad job and screwed up a bunch of stuff. If they were if everything would have gone fine, I wouldn't have cared. I don't care who all is involved in the process, how many partners who's what to my mind we were working with, like it was Empire moving company or something like that. I don't even care who accepts the payment, the guy in the truck wanted us to Venmo him, the other person said Pay Pal, I actually wouldn't care. But because they screwed everything up. Now it got really nasty. And you got to see the really messy side, we literally couldn't figure out who was in charge the person that gave us the original quote, we couldn't even figure out who that was because every other person was giving us different quotes. When someone screwed up, they would say it was someone else, right? It became like a total disaster. So I can imagine this kind of when the consumer doesn't know who owns what, and who's responsible for what like, how do you how do you prevent that in this world?
James Hodgkinson 31:09
When it comes to China, or or, you know, what was traditionally called PRM architecture that that that scenario of, of who's responsible and you know, who screws up here is even you know, is even a bigger complexity because you know, you have so many moving parts, where you say, right, if you're a business who wants to do a world class job for your partners, in terms of making it really easy to transact or supporting all these individuals that need you know, you have to have flawless, you know, authentication, you've got to bring them all the content and systems and tools on their terms, you've got to combine about 10 different capabilities across learning management, sales enablement, business intelligence dashboards, not one company in the world of any scale or size has done a world class job of this, I guarantee you, if you log in to the top 10 largest tech companies in the world partner portals, you could find 25 things wrong with them in the first 30 minutes. And the partners were forced to use these technologies every day. But it speaks to, again, this lack of accountability in the solution set where you're saying, well, actually, it's that vendors fault because they built a module that sucks or that single sign. But if
Jared Fuller 32:15
you're brand finally, we're all waking up to be like, but no, it's your brand, right?
James Hodgkinson 32:21
Yeah, exactly. So it's like, you know, so this is the big passion, I've got it 360 Right now is where the rubber meets the road with all that this is a first class user experience that is consumer grade, where you're kind of saying right, when I hit X, Y, Zed brands, this is perfect. You know, everything worked. And whatever is happening behind the scenes, I don't really care, I don't mean, how much sticking plaster there is or what's been moved around. If the button I press here works perfectly, if that screen looks the same as that screen, if this loads instantly, if it's if it's perfect on my mobile, this is the the winning formula for the ecosystem and channel businesses of the future. Because everything is digital, you can't just go you know, we have a great program to offer our partners, if all the way that you execute, it sucks, you know, that just doesn't work. So that's the thing that we're like trying to work on every day at 360. And I've been doing this 20 years, I think we finally got a formula for this, but it but it isn't any one company that's going to solve that you can't just go and build all that on Salesforce, you know, it's really tough to do this time type of thing. But the accountability thing is exactly as you described. It's just way more complex in a b2b and an ecosystem context, because there's a billion variables and often hundreds of different technologies involved. Yeah,
Jared Fuller 33:30
experience sucks. It sucks so bad. Like it's just absolutely horrific. And like, whenever I met you, and you're like, look, here's the Enterprise Architecture and infrastructure and UX, right? The UX that most people see in enterprise channel. I'm like, Yeah, this is frightening, James, this is not just, it's not bad. It's frightening. And we're like, here's how we're gonna unify it and make it a seamless experience where everything works. And I'm like, Yeah, that's what we've needed. Forever. And that's the thing that's so frustrating about those broken experiences. Isaac, right that you have those, the one where it's like, yeah, there are 10 things involved. That's partnerships are complex. Not difficult. Mike, right. And so like the the first principles, it's kind of crazy, because first principles are like simple, not easy, right? Like, run 30 minutes a day. He couldn't think of anything simpler in the world. Like literally you just move, just move. You could come with 1000 excuses, but you just have to move. Great, simple, not easy, not easy to do that everyday. But complex is like here's the 14 step process to get from A to Z. It's it's any of those individual steps or Kate, very, very easy, but together. They're complex. And how bad these experiences get are absolutely hilarious when you start putting these things together, so you're moving experience one. Oh my gosh, yesterday my wife was trying to do at HBO show and they just did anyone notice the transition from HBO max to just Max? Is it just me out there? They they rebranded from HBO max to max. And I'm like, why did we need a new app though, but get this. So the app is different for Samsung, than it is for sharp than it is for Vizio. Right? So you have three different versions of this app for three different TV platforms. And my oh my gosh, my wife was going insane. And so are my, because the show that they were watched upstairs, and downstairs, they're out of sync the last episode. So it's like, no, we've already seen this one, we'll know which Episode Are we actually, so they don't talk to each other. And then the account that you're logged into it, there's like nothing was working to like get into the app. And it's like, Oh, you, you need to uninstall this one and go download this other one. It's like, how does a company like HBO, in the consumer side, screw this up. So bad, because of this lack of like, unified experience made me like, it's just another example, Isaac, oh, that's all around us. And I think as things get more complex, more ecosystems emerge, more partnerships happen, more of the distribution gets atomic, right, atomized. The need for bro with the customer experience. Yeah, at the end of the day, is like, that's the thing that matters. And I think James that's been missing from this conversation. But if you just look at your consumer world, right now, people, just looking at your, the tech world around you, as a consumer, you'll recognize things are being atomized and the experience is like, but things are breaking more than ever.
Isaac Morehouse 36:31
James as your, as you were talking about the the heroic work you're doing, helping helping people sort these things out. I was thinking, you know, it's there's an added layer of, of difficulty. It's not just making all these things work together. So it's the seamless experience that the customer wants. The other difficulty is, the customer doesn't know what the hell they want. And it changes all the time, right? That's like, and that's kind of like the silver lining and the beauty and the fun of this game. That's what a market is. It's constantly churning and dynamic. I mean, I just think for myself the number of times where I'm like, you know, back in the day, you had to buy a giant cable package, and you get every channel, even the ones you didn't want. And you're like, I wish I could just pick the ones that I want. Then you get to a world where you can just pick one at a time what you subscribe to, then you're like, I have too damn many subscriptions. I just want one bundle, right? It's like, we don't really know it kind of changes all the time. There's just like a good reminder that like, there's a dynamism and there's always going to be a dynamism. And it's always going to be this constant process of bundling, and unbundling and always trying to say there's now there's new technology that didn't used to be available. What does that change that change is the optimal size of the bundle or the optimal, you know, complexity of partnerships. Now there's this now there's that consumer sentiment changes. So there is an element of this where you have to kind of like, you can't only blame the company's customers, all of us are to blame as well, because we don't always know what we want, it changes all the time, which is what makes it fun.
James Hodgkinson 37:57
Yeah, and this is what I realized is, technology has to be built to be able to change all the time. So what we're providing in the user experience, context is more about composable architecture and loads of variables. Because, you know, it's easy enough to say, right, if I build an app, or it should be easy enough, if I'm HBO to say build an app, because generally the consumer is the same, the functionality is the same, the content changes, but you know, but if you're dealing with a complex ecosystem, the tooling changes, the dimensions change all the time, the business strategy keeps shifting. And the variables are really, really hard to manage at scale, because you've got to take care of regions, languages, partner types, roles, all these different things that you know, that aren't uneasy. So the conclusion we came to is that that framework has to has to move at the speed of the business, you have to be able to plug things in, take other things out, change the rules, rebuild the experiences, you've got to move in real time, if you're supporting an ecosystem, you can't, there's a lot of people who still think this is like building a website, you know, I'm going to build a beautiful looking partner portal. And it's like, well, I now need a developer to change this. And it's going to take me six months to get prioritized on the Salesforce roadmap, it just doesn't work. So I you know, so for me, it's a whole new tool set that you need to really keep up with your ecosystem. And that's not to say there's also now multi platform ecosystem tools that need to be connected in there too. Like how do you get account mapping for partners launched like with platforms like reveal how do you know so it's an ever changing situation and to your point, the only way you can keep up with that is keep changing with it you can't you can't launch a beautiful partner offering and and expect it to be good a year from now. It's gonna keep moving around. That's the That's the issue.
Jared Fuller 39:35
What a place to stop James. Thanks for hanging out with us
James Hodgkinson 39:37
today. Oh, it was a pleasure. Not enjoyed it. Thanks, guys. Yeah, absolutely.
Jared Fuller 39:41
The collision of channel and partnerships. I think this was a gonna be a seminal episode. I don't think we've done the like, hey, for real though. What is what's happening in channel what's happening in pet partnerships? How are we How is this two sides of the same coin? I feel like this is a refreshing one for us to continue to play in the same watering holes too, right? There's no More partner, people showing up to channel things in jail things showing up a partner land. So we're all friends here, folks at partner hacker and on partner up. So have a good one this week. Isaac, I don't think anything to plug this week on this particular episode.
Isaac Morehouse 40:13
Yeah, I don't think so. You can look for us in a couple months, a couple months isn't that far away? I don't even know at catalysts looking forward to that. But I don't think there's anything else in the near term that I can think of, Oh, I do have one thing. Jared, your show your your big star, your reality TV show with Jared Robin from Red genius.
Jared Fuller 40:33
I want to talk about this. It's going to be too good. It's going to be too real. I'm going to get cancelled. It's going to be a problem. I get cancelled because of the show, folks. Yes. So June 25, Friday, 23rd June 23 23rd. Live, go to partner hacker.com. It's gonna be a reality TV show. Like, I think for like the profit, we're coming into the funnel, and then we're gonna flip it upside down. And I'm actually going to show you how to get this thing fixed in terms of revenue mix structure, and we're going to talk to ICS we're going to talk to managers. And it's going to be live, though. It's Jared and Jared. It's gonna be a heck of a show. James, thanks so much. Partner up, peace out. We will see you all next time.
