The New Breed of Business Influencer: Do Influence Fees Make the Grade?
by Beth Vanni, Vice President
Reaping tangible business efficiency benefits from technology has long been the quest for end-users, and as such, has been their primary demand from their solution providers. But, what kind of channel organizations are providing the greatest value around business or industry solutions today? And are they getting the right kind of support from IT vendors to be effective and remain relevant?
Amazon Consulting research has shown that end-users have a distinct hierarchy of needs of their solution providers. On the top of that list is the solution provider’s ability to have a comprehensive product and services offering, combined with the ability to be proactive and anticipate their unique needs. In our most recent research entitled “Influencing the Influencers”, Amazon Consulting identified the current breed of partners offering these tailored business solutions.
Top business influencers are a non-traditional partner type — they have the combined characteristics of several traditional partner segments – regional SI, ISV and specialized business process consultant. They engage most frequently with their leading IT vendors in non-transactional ways; as a business influencer/co-seller, an authorized service delivery partner and/or an ISV. Because they frequently don’t resell product, it’s hard for many vendors to capture their sales influence or service delivery quality and recognize and reward these contributions.
So, forget transaction counts or resale revenue – these partners are all about services. In fact, their leading existing services revenue comes from traditional business consulting (52% said they derive more than 50% of their current revenues here), followed by IT consulting services, and finally a distant third was IT integration services (12% said this was more than 50% of revenues). But what about corner office sales influence? Can vendors’ traditional influence or referral fees motivate these partners to recommend one IT solution over another?
Well, our research indicates that these selling rewards are fifth on the list of most requested sales support from business influencers to their vendors (<20% response). Tops on this list was easy, local sales teaming processes with the vendors’ direct sales or service teams. Solution playbooks was a close second, suggesting that although these business influencers are savvy salespeople, they’re open to solid tools and references from their vendors. In fact, vertical use-cases and references came up throughout this research as a one of the top three tools business influencers.
So should vendors not offer influence fees? There are indeed some solution providers to won’t take influence fees because of the administrative hassle and/or their perception that accepting these fees compromise their objectivity with the end-user. However, we see that most frequently with the larger national or global SI’s. Structured properly, these fees should be able to be used by the business influencer to drop to the bottom line or offset other enablement costs like training or dedicated headcount. And, smaller or more specialized firms typically use these fees to enhance the profitability of their growing industry practices, assuming they have an ongoing working relationship with that vendor supported by a specific technology solution and strong sales teaming relationship.
For full research results from Influencing the Influencers, access an Executive Brief of the findings here.