Distributors as the Trusted Advisor

The relationship between distributors and partners is stronger than most think and can make the difference in partner engagement and performance.
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The technology industry uses several terms to describe channel partners. Resellers, managed service providers, systems integrators, national solution providers, direct market resellers, and solution providers — to name a few. The one phrase that applies to all these monikers is “trusted advisor,” the label that reflects the strong bond between a partner and customer built on the longevity of their relationship, the partner’s intrinsic understanding of the customer, and the propensity of the customer to act on the partner’s advice.

We know strong bonds exist between partners and customers, and that partners have influence over their customers’ brand and product consideration. The average duration of a partner relationship with a customer is seven-plus years. During that time, a partner gets to know more than the customer’s business. It gets to know its strengths and weaknesses, successes and setbacks, ambitions and goals. Through this relationship, the partner can prescribe technologies that solve problems and enable growth.

And it works: A customer will either buy or strongly consider a product recommended by a trusted advisor 90% of the time. That’s solid odds favoring the vendor selling through a partner.

Here’s the thing: We don’t ascribe this same bond to distributors and resellers.

A general assumption among vendors is that the relationship between a distributor and reseller is opportunistic. They believe that resellers view distributors as warehouses in which they place orders based on availability rather than persistent relationships. They assume that because resellers will open and maintain lines of credit with multiple distributors, they’ll flow where they have financing headroom. Partner loyalty to a distributor is rarely a consideration.

Consider this: The average reseller carries the products of seven primary vendors and as many as three-dozen secondary vendors. That same reseller typically works with no more than three distributors. Guess who gets more time with the partner: the distributors.

The reality on the ground is partners establish trusted relationships with distributors that can augment their capabilities, provide advice and guidance on product selection, and lend support for implementing and supporting customer engagements. The relationship is built less on product and more on mutual benefit in meeting end customers’ needs and expectations.

Vendors look at distributors as banks as much as inventory and logistics providers. They’re really hubs in the two-tier go-to-market matrix. The average distributor works with thousands of solution providers in their respective markets and coverage areas. They have incubation programs that help start-ups identify and reach resellers that wouldn’t otherwise know of them. They have marketing and co-selling capabilities for putting vendor products in front of partners for consideration. And they have resources that augment partner sales and marketing, resulting in a higher lift for vendors.

Distributors operate communities in which they bring partners together for collaboration and enablement. They have solution centers and showrooms that enable partners to demonstrate products and capabilities to customers. They provide training programs that help partners upskill their capabilities and value. They have reference architectures and engineers that help partners design and build complex systems on behalf of customers. And they provide technical support, acting as a surrogate for vendors in resolving partners’ technical issues.

These capabilities are more than services. They’re the glue that keeps partners close to the distributor and, by extension, the vendors in the distributors’ networks. The interactions between vendors and partners on sales, marketing, technical support, credit and finance, and business development form trusted bonds. When vendors call down to partners with an opportunity, the partner is more than likely to take the call and consider action.

Distributors are influencers. They’re the gateways to scores of partners and entry points to reseller networks. They’re proxies for vendors that can’t scale their management organization to cover the totality of their partner communities. Distributors aren't transient partners; they're influencers. Vendors put themselves at risk by thinking distributors are just Walmarts waiting for resellers to show up with their carts.

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