Basics of channel MDF

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Basics of channel MDF and channel Coop Programs

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Basics of channel MDF

  1. 1. 18 November 2009<br />Vaughn Aust<br />William Gilsing<br />The Basics of MDF & Co-Op Programs<br />
  2. 2. Agenda<br />Why joint marketing and sales campaigns?<br />Why do vendors fund partner marketing and sales campaigns?<br />What are MDF and co-op funds—and how do they differ?<br />What are best practices in MDF/co-op programs?<br />Why do partners not fully utilize MDF and/or co-op funds?<br />How can you measure the effectiveness of MDF/co-op programs?<br />What are the best practices of an effective MDF/co-op program?<br />Why hawkeye’s channelMDF solution?<br />Why the hawkeye channelMDF solution?<br />What tools are available to promote the channelMDF solution?<br />2<br />Agenda<br />© 2009 hawkeye, all rights reserved. <br />
  3. 3. Why do vendors fund partner marketing and sales campaigns?<br />Joint campaigns grow business through the channel<br />3<br />Why joint marketing and sales campaigns?<br />© 2009 hawkeye, all rights reserved. <br />MDF/Co-Op Spend<br />Nearly 60% of vendors spend at least 5% of their marketing budgets on MDF/co-op programs<br />Partners contribute 4% of their marketing budgets to MDF/co-op programs <br />
  4. 4. What are MDF and co-op funds—and how do they differ?<br />Funds differ by partner type and objective<br />Market Development Funds (MDF): distributed to partners in advance of sales<br />Ideal for partners with a services business model who “push” products through channel; specify brand, develop markets, and grow business<br />Co-op (Cooperative) Funds: distributed to partners based on % of trailing sales<br />Ideal for partners who fulfill demand and “pull” products through channel; do not specify brand or sell services<br />© 2009 hawkeye, all rights reserved. <br />Why joint marketing and sales campaigns?<br />Service Partners<br />Consult, Design, Implement<br />PUSH ABILITY<br />Mixed Model<br />Transactions + Services<br />“VAR”<br />Fulfillment Partners<br />Transaction, Volume<br />PULL REQUIREMENT<br />From a legal standpoint, vendors must account for the use of funds and abide by anti-trust and other legislation under the Fair Trade Practices Act (FASB) and Robinson-Patman Act. Discrimination may result in 3x damage penalties.<br />4<br />
  5. 5. Why do channel partners not fully utilize MDF/co-op funds? <br />By some estimates, as much as 50% of all potential funds go unused <br />5<br />What are best practices in MDF/co-op funds?<br />© 2009 hawkeye, all rights reserved. <br />Why do funds go unused?<br />Unfamiliarity/unaware<br />Complexities, administrative burdens<br />Processes that do not engender trust<br />Long delays in approvals and payment<br />What do partners want in MDF/co-op programs?<br />Clear processes with simple rules<br />Speedy payments—<br />30 days or less<br />Online status/tracking and updates<br />Pay claims in cash, not credit<br />Greater flexibility for activities—<br />trust the partner to know their customers <br />and how to market to them<br />Vertical-friendly options<br />Solution-friendly options <br />Most partners are involved in more than one program and some in as many as a dozen; with each program, the administrative burden grows.<br />Partners want to easily apply for funds—and receive payments quickly<br />“Simplifying the tool is the best way. <br />I suggest having someone who knows nothing about marketing or co-op try to work the tool and see what difficulty that person has.”<br />–Partner<br />
  6. 6. How can you measure the effectiveness of MDF/co-op programs?<br />Use solid, consistent metrics to measure performance<br />6<br />© 2009 hawkeye, all rights reserved. <br />What are best practices in MDF/co-op funds?<br />
  7. 7. What are best practices in MDF/co-op programs?<br />Eliminate complexities—and foster relationships of mutual trust<br />7<br />© 2009 hawkeye, all rights reserved. <br />Make programs easy to use<br />Clear, concise program guidelines that can be downloaded, printed and saved<br />Integration with other systems—business planning tools, collateral builders<br />Offer pre-approved activities for quick deployment and pay-outs—”Campaign in a Box”<br />Easy access to customer support<br />Streamline documentation<br />Deliver a collaborative, transparent process<br />Online tools—to track status of approvals and payouts<br />Online account statements—to view available funds and historical usage data<br />Be competitive<br />Be aware of how much your competitors are paying for similar activities<br />Industry Benchmarks<br /><ul><li> Time from claim to payment—</li></ul>3 weeks<br /><ul><li> Administrative cost / project—</li></ul>$20-$30 per project<br /><ul><li> Program cost vs. total value—</li></ul>Less than 1%<br /><ul><li> Fund utilization rate—</li></ul>12%-50% industry range <br />What are best practices in MDF/co-op funds?<br />
  8. 8. What are best practices in MDF/co-op programs?<br />8<br />© 2009 hawkeye, all rights reserved. <br />Sell the program—to the field and partners alike<br />Engage channel reps in the process from the start<br />Demonstrate the value<br />Increase adoption with training, education, incentives<br />Proactive, timely, ongoing communication<br />Close the loop<br />Require that partners estimate ROI when requesting approval for projects<br />Map factors to activities and use consistent values to facilitate reporting—drop-down and numerical values<br />Requires that partners review and amend ROI estimates as a part of the claiming process<br />What are best practices in MDF/co-op funds?<br />
  9. 9. Why the hawkeye channelMDF solution?<br />Maximize fund utilization—and partner satisfaction<br />9<br />© 2009 hawkeye, all rights reserved. <br />Easily manage funds and approve/deny requests<br />Highly flexible, automated workflow<br />Online submission and management<br />Speed time-to-payment<br />Electronic funds distribution<br />Simplified compliance with tax and legal regulations<br />Easily track and measure program metrics<br />Single view of program activity status and reports<br />Complete, visible audit trail through integration of all functions—Finance, CAM, Partner, and Administrator<br />Quickly deploy the solution—worldwide <br />Integration with your existing systems<br />Multi-languages, multi-currencies, local business rules<br />Why the hawkeye channelMDF solution?<br />Powered by hawkeye’s proven channelconduit platform<br />
  10. 10. What tools are available to promote the channelMDF solution?<br />Integrated tools to generate awareness and demand<br />© 2009 hawkeye, all rights reserved. <br />Website<br />Data Sheet<br />White Paper<br />Channel Fact Sheet<br />Why the hawkeye channelMDF solution?<br />… With more on the way!<br />10<br />
  11. 11. THANK YOU<br />© 2009 hawkeye, all rights reserved. <br />

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