The month of January, for me, has been all about metrics.
It started with Architecture - if you can't track it you can't measure it and if you can't get it into the core model you'll have a hard time scaling.
Last week we discussed what I really want - filters by Program and Partner across all primarily leading metrics. It's a clear call back to the whole 'architecture' thing I started with. I also kicked off a fun new weekly partnership with PartnerHacker so you can also read it here (or ... literally here... if you're seeing this on PartnerHacker).
This week we're looking forward into what I believe is a growing trend for Partnership metrics in 2023, built around the core tenant that 'Trust is the new data', literally the tag-line of the PartnerHacker crew,
Here's the top-line summary...
We're all aware of what's happening in Tech, right?
Layoffs. Almost every day.
I have been there. Literally. I'm fortunate to be back on the horse myself, but I know lots of people that aren't. It's a difficult time and the relatively swift shift in direction for technology companies has leadership reeling as we head into what may be the most unpredictable year in the past decade. For those not paying attention, a short recap of the past few years ...
- 2020 was the Year of the Pandemic
- 2021 was the Rise of Remote Relocation
- 2022 was the Great Resignation
- 2023 is already being hailed by some as Retention or Bust.
Okay... it's just me calling it that so far. But people ARE talking about how 2023 will look different for companies that want to survive to see 2025.
Here's a couple of examples:
- Eddie Reynolds, who I gave a nod to last week, is saying Revenue Retention should be the North Star for Revops.
- My friend, Groves, over at Crossbeam, is calling for product marketers to be prepared with a different kind of GTM Playbook focused on efficiency and retention plays.
- Shahin Hoda put out a quick call for a focus on Net Revenue Retention and Net Dollar Retention. I don't know Shahin, but I liked the post and it's another great opportunity for top-level filtration on Partners and Programs.
Trust is the new data?
'Trust is the new data' is a really catchy headliner but for those of us responsible for driving metrics the organization can actually understand, it's a challenge. How do you measure trust? I've been mulling this over and have a few tangible ideas.
First - how does trust work?
When we build relationships with people we start to barter in trust. Some of us are generous with that resource up front and give people room to lose it. Others start slow and make people earn it over time. However you do it, you do it that way because of your experiences with people, because of how we build reality for ourselves.
People look like people that hurt us, or remind us of our favorite relatives, or smell like someone we once cared deeply for. These past narratives build the reality of our experience as people and thus impact our levels of trust. We can find ourselves trusting someone more or less as our individual experiences with that person accumulate in our lives.
Still... most methodologies that I've been a part of, however, measure this trust in terms of what is received.
- How many leads did we get?
- How much ARR did they generate for us?
- How much did they invest in our sponsorship opportunities this year?
- Overall, did these numbers show wins for us?
- How many open opportunities do we have with their customers?
I'm not arguing that these metrics should be thrown out (assuming you've set up the needed architecture to track them appropriately). I'm arguing that they should be supplemented, particularly as we approach what could be one of the most difficult economic periods of the past decade, with measuring what we give as an actual component of success in it's own right.
Measuring What You Give
Now for the practical element of identifying what to measure. Here's the good news - you're hopefully already doing a lot of this and only need to shift your mindset and language to adjust the framework. In some cases, you may need to work with your partner to get the insight you want - this is another win as you're now having intentional conversations with them where you're literally asking about the health of their company and how you have helped and can improve from your end.
Keep in mind - this is NOT an exhaustive list. It's literally built around the idea that I want to build TRUST, so what can I GIVE that I can also MEASURE, and HOW? I look forward to hearing about the really obvious things that I will miss in my recommendations.
The logic here is pretty straightforward and hopefully an easy metric to standup. If you're part of the 'give to get' movement germinating with the Ecosystem community you'll understand the inherent value in this measurement. Strive to out-give your Partners on distributed leads this year. Example: Marco De Paulis, who I've come to really appreciate, recently posted on missing quota but highlighted a 3:1 ratio for leads given to Partners as a massive result. What a great way to tell new partners they can trust his company with their future success.
- How many leads did you generate for your partners this year?
- What was the close rate, i.e. the quality, of those leads within Partner funnels?
- How fast did those leads close by comparison?
- Do some partners do better than others, why, and how can you share that knowledge?
Marketing Development Funds (MDF)
Another easy metric to track, yay! You're most likely already keeping up with this as a measure of return on your investment. Flip the script on this one and set a goal for your contributions instead of a budget on your limitations. It's a small mindset and language shift that can have big impact.
Imagine walking into a meeting with your Partners discussing investment GOALS for sponsorship instead of limiting budgets. You'll track all the normal stuff, but remember... we're building trust this year. Don't hold MDF over your partner's heads and instead find ways to support their growth by leading the way with sponsorship dollars for their big events. Be the most generous partner in their ecosystem now and you'll be on the front-end of their growth in 2024-25.
- How much did you award in total?
- How much did you award by program?
- How much did you award by Partner?
- Did you tell your Partner?
- How much revenue for the partner was tied MDF by event/period?
I think about these as 'one pagers' for recruitment and can't think of a better way to help your Partners build the case for engagement than being able to tell them exactly how much you pay out to partner sales reps for their help spreading the word. Track it. Celebrate it. Share it. Market it (directly to potential partners in meetings of course).
- How much did you pay overall in the last fiscal cycle?
- How much per program?
- How much on average per partner?
- What's the average spiff paid?
- Who was your highest-paid partner? SPIFF them again!
Collaborative Training Events and Playbooks
You train your salespeople often. You might even revamp your sales process with every new leader, every couple of years. How often do your partners get access to that kind of training, particularly co-selling training?
Find your highest potential partners, maybe those without the resources, and lift them up with inclusion into training events that are designed to help them succeed alongside you. As with everything else, track it. Set a goal for how many people you want to co-train and get your PAMs or CAMs or PMs or whatever you call them on the phone and responsible for this metric.
- Published list of upcoming opportunities
- Incentives for participation
- Recognition for completed events by person
- Collection of playbooks with guidance on successful practices
I'm resisting the urge to write out my thoughts on this topic at large - believe me I've got some - and want to focus on using these metrics as a pathway for clearly identifying how you can help your Partners succeed. The results of a well-defined account mapping exercise are laden with useful data that demands strategic effort to capitalize on. For 2023, make the core of that effort tied to where you can help your partners. All of these efforts have clear benefits for your team as well so the real shift is in the language and attitude you use to present and chase these down.
- Where do your customers overlap with their opportunities?
- Where do shared prospects open a door for collaborative GTM and MDF investment?
- Where do your opportunities open a door for building up their solution?
- Where do shared customers create space for integration activation for them?
Collaborative Renewals and Retention
Yes, I hear you saying: "Aaron, these aren't the same thing." I know. I get it. Thank you. That's not actually the point of this section, though. The point is that you should lead the way - maybe via Account Mapping, etc. - to help Partners identify and expand renewals and maximize retention as a shared metric.
- How many of your shared customers renewed at the same rate?
- How many shared customers renewed at adjusted rates, up or down?
- What's your retention rate by program and partner?
- Where are you seeing Partner customer churn, why, and how can you help them?
Partnership data is notoriously difficult to come by because most company reporting systems are barely getting the internal reporting together in a meaningful and consistent way. This makes transparency in reporting difficult for external parties like partners. It also makes the opportunity for building increased trust that much larger.
Imagine being one of the only partners in their mix that has a clear path for how to find and understand shared metrics. Tracking this as a metric yourself may look like determining what you want to show them over the next twelve months and then keeping up with attainment as that goal is realized. One idea off the top of my head - measure what you're now relentlessly focused on giving them as a top priority.
- Leads Generated with all those metrics above if you can get it from your end
- SPIFF paid to their team in total
- Leaderboard for their team on total ACV/ARR/MRR (you get it)
- Shared Customers with health status ratings to help highlight co-selling opportunities, upsells, and potential churn
- Certifications, Awards, or any other recognition for performance and contributions they've made
- Total ARR, etc.
The Wrap Up
This is not exhaustive, and I'm confident you'll find other ways to build up your partners and increase trust in 2023.
If trust really is the new data and retention is driving the conversation for 2023 on the customer side, there's a practical need to figure out how Partners are engaged in that conversation for 2023 and to make sure partner retention is at the forefront of our conversations.
After all... if the future of SaaS is truly going to be built around successful ecosystems, you're going to need them.