Everyone seems to love “Top 10” lists, and I am no exception. I continually get frustrated when we get calls from clients to put an incentive program together only to discover that the program was ill conceived-especially if more than one of the “deadly sins” is violated (as presented below).
So while everyone else has a top 10, I decided to go one better…behold:
The 11 Deadly Sins of Channel Incentive Program Planning
Why to I refer to them as “deadly sins?” Because violating any one of these can diminish the effectiveness of your program and waste time and money. Yet, I often see more than one of these sins violated in the manufacturers rush to put a program in place-and then wonder why the program didn’t work as well as they hoped after the fact.
11. Not targeting the right level of the demand chain. Incentive programs can target the consumer, the reseller sales rep (and/or sales engineer), or the reseller entity. Any one or combination of these may be viable depending on your objectives. Targeting any one has different merits, and challenges.
10. Not having the appropriate terms and conditions in place–or, “Ts & Cs” if you prefer. This is an official legal document that defines the eligibility, terms and parameters of the program which participants must agree to early in the process-not merely marketing hype that provides a program overview.
9. Not requiring acceptance and understanding of the aforementioned Terms & Conditions. Such acceptance should be done via positive acknowledgement in advance of participation.
8. Having overly complicated business rules to earn the reward. Like all things in life, “KISS” is the guideline here (Keep It Simple Stupid). Program understanding should be both compelling and easy to understand for those of us with a short attention span.
7. Ambiguous proof-of-performance requirements. In this case, by “ambiguous” I refer to “difficult to validate” through other means. The bigger the reward, the more there should be an audit trail in place that validates the transaction details.
6. Not validating that the program is actually “legal” in all the jurisdictions targeted. Many countries and even some states regulate how program may be conducted (or not). This topic could fill a book. If you’re planning a global program, this can get real complicated in a hurry.
5. Not targeting the right channel segment or partners. Surprising as this sounds, I can’t tell you how many programs “required the ‘buy-in’ from X partners” to be successful, only to find after the fact that those very partners don’t sell the particular product or the program didn’t correlate with their go-to-market strategy. Many resellers may not even permit vendor-developed SPIF programs as it interferes with their own sales policies and practices.
4. Not considering advanced registration. If it is expected that more than one claim may be submitted by any one participant, then pre-registration offers many advantages. Among them, advanced registration provides metrics on participation levels early in the program period, and streamlines the claiming process for the user by not having to re-key personal information with each transaction among them.
3. Stacking incentive programs. A lot has been written about how many vendor companies have as much as 40-50 different promotions and incentive programs targeting the same partners concurrently….need I say more to justify why this qualifies as a “deadly sin?”
2. Thinking short-term and not optimizing your investment. Many programs are launched to attain a tactical need supporting a short term sales goal. Websites are built, infrastructure is put in place. The program is then dismantled after the program period is over in a few months. Then, six months later, the whole thing has to be rebuilt when a new tactical need is established. This lengthens time to market, is inefficient, and often doesn’t leverage any of the key learnings from the prior program. It’s most efficient to construct a single conduit that may conform to your promotional needs as they occur.
And the #1 reason why incentive programs fail…
1. Ill-conceived communications strategy…..yep, you heard it right. As hard to believe as it is, in the post program analysis we conduct we find that the number one reason participants don’t support the program is that they didn’t know the program existed or didn’t effectively understand the program attributes and how it fits with their business model. So, for instance, it’s not enough to tell your primary contact about the program when it’s a SPIF program targeting reseller sales reps, you have to make sure the reps themselves know about the program and understands the benefits to them.
So, these are the facts kids–I can’t make this stuff up. Each one has enough content behind it to support an article on its own. In the meantime, if I’ve missed one or if one of you would like to share your horror stories, we’d love to hear it.