What is Partner Relationship Management?

You’re always on the hunt for new revenue, but new sales has to come from your sales team, right? Not always. Sales can come from partners, too. In fact, partner selling is a great way to take the pressure off your own reps — and it’s relatively easy to implement. Instead of swimming upstream, here’s how partner relationship management software can help you easily hit those elusive sales targets.

What you’ll learn:

• What is Partner Relationship Management (PRM)?
• Why is PRM important and what are the benefits?
• What are best practices for Partner Relationship Management?
• How to choose the right PRM tool: features to look for

Partner sellers, also known as channel partners, are companies that sell the products and services of other businesses to their own prospects and customers. For example, many car manufacturers work directly with dealerships to sell their vehicles. In return for this collaboration, partner sales reps typically receive commissions, bonuses, or incentives. Partner Relationship Management (PRM) involves all the tools, processes, and training involved in helping partner businesses successfully sell third-party products.

PRM is sometimes confused with CRM (customer relationship management), but there’s a key difference: instead of managing relationships with customers directly, PRM optimizes interactions with partner businesses.

The primary benefit of partner selling is low-investment revenue growth. You save on hiring more sales reps because you’re just paying commissions. Plus, instead of spending time getting up to speed on a new industry, you can lean on partners who’ve already got the know-how and connections, making it simpler to expand and reach more customers. This helps you avoid high customer acquisition costs and cut expenses that would otherwise be needed to support increased sales efforts, all while bringing in more revenue.

With the right tool and training, PRM can also reduce the time it takes to bring your products and services to market. By leveraging relationships with customers that partners already have, businesses avoid the time-consuming process of finding and connecting with new prospects.

A smart PRM strategy requires careful planning and execution, bringing together the right tool, clear success metrics, thoughtful recruitment, a fair commission structure, training, performance tracking, and regular communication with partners. Here are seven best practices to get you on the right track.

As they say at Salesforce, if it’s not in your CRM, it doesn’t exist. Only, in this case, we’re talking about your PRM solution. Pick a Partner Relationship Management tool that combines sales pipeline management, performance tracking, rep onboarding, analytics, and partner engagement in one place — ideally with real-time updates.

Work with your management team to map out concrete objectives for your PRM strategy — before you onboard partners. Establish clear KPIs that map to your organization’s long-term sales planning initiatives. In most cases, this will include the number of new customers acquired or amount of partner sales closed in a quarter or year.

The ideal methods for recruiting best-fit partner sellers depend on your goals, industry, and resources. In most cases, this will involve a mix of referrals, inbound recruiting (e.g. a company finds your website and reaches out about a partnership), and outbound recruiting (e.g.. searching for partners at events).

My recommendation is to start with a partner persona: the ideal industry, customer base, product portfolio, and goals of your target partner. These criteria should align well with your own strategies and vision. Once your persona is in place, advertise partner selling opportunities on the channels or in the spaces your ideal partners spend most of their time, like LinkedIn, trade publications, or at events. You can also research ideal candidates and reach out directly.

No partner, however enthusiastic, is going to deliver big sales without incentives. Set commissions and bonuses for partner sellers that align with industry norms (commonly 10-40%) and factor these into overall revenue expectations. Also — and this is key — do not promise partner sellers higher commissions or bonuses than those offered to your own sales teams. If you do, you may find your internal sellers disincentivized to sell, undercutting your sales efforts.

An effective onboarding program is intuitive, accessible, and comprehensive. Provide demos for each product your partner is selling, easy-to-digest and up-to-date reference materials on key product features, customer case studies that show your product or service in real-life scenarios, FAQs that cover questions and objections commonly surfaced during sales conversations, and sales process specifics — like common stages and exit criteria for each stage. Also, provide contacts at your company if partner sellers have any questions.

Track performance on a regular basis — at least quarterly — and revisit your training to ensure reps have the skills and information they need to hit KPIs. I recommend checking in with partners informally every week just to make sure things are going smoothly.

Make it a point to keep partners informed about product updates, marketing strategy changes, and other relevant product or sales-related information that can affect their performance. A good rule of thumb: If your inside sales team is briefed on something, your partners should be, too.

I’ve known many businesses that attempt to manage partner sellers in spreadsheets. It never works — spreadsheets are hard to update and they don’t really offer “at a glance” performance statuses the way an effective PRM tool does. If you want to make your partner selling successful, look for a high-performing tool that combines onboarding, real-time tracking, and selling features in one platform. Here’s what to look for:

• Training/onboarding: The best Partner Relationship Management solutions offer onboarding tools that allow you to add the demos, product feature references, and case studies I noted above. These should be in one place, easy to follow, and easy to update.
• Pipeline management: It’s helpful for reps to see their partner sales in a dedicated pipeline, separate from their inside sales — this helps them with prioritization and performance tracking. Ideally, your PRM solution will have the ability to show clear pipeline stages with exit criteria so reps know when to move leads down the funnel.
• Selling portal management: Make it easy for you and your partner to sell your products/services, picking a PRM solution that allows you to set up selling portals (like online stores). This feature doesn’t have to be complex, but it should allow you to add design elements that match your partner’s brand and style to ensure a seamless customer experience. Also, look for portal builders that allow you to manage inventory, discounts/special offers, and custom products/services. This makes it easy for you to expand your partner sales program.
• Analytics: Your PRM tool should allow you to track topline partner sales KPIs in real-time — metrics like customers acquired or sales closed in a given quarter. You’ll also need to be able to track sales by partner rep to ensure commissions are accurate and delivered on time.

Increasing your sales organization’s impact through partner selling might sound overwhelming, but it doesn’t have to be. With the right Partner Relationship Management tool, you can easily tap into a new flow of customers and empower your partners to sell quickly and easily. Just remember to revisit your training to ensure it aligns with your company’s most recent strategies and product releases, and update performance metrics periodically to make sure they fit with your overarching sales goals.