The opportunity cost of outdated non-performing B2B sales channel

Ed Marsh | Aug 2, 2016


Nice folks to drink a beer with

If you work with reps or distributors, you've probably got some channel partner teams that look more or less like this. They're good people, honest and loyal. In fact they've probably been representing your products for 20 years or more.

Most firms are basically a couple industry veterans who are coasting toward retirement. They have a rolodex (in many cases, literally...still) full of industry contacts in their territory. Many of their contacts are also coasting toward retirement.

You've probably ridden many miles with them between sales calls over the years, sharing stories of family and hobbies. You've stayed in the same well-worn motels and eaten mediocre chain restaurant meals together. You're buds. You've earned your service stripes as partners over years of hard work.

Recently, they may have brought in some young blood - perhaps a child of a founder - in hopes of keeping things going.

This was an awesome business model in the 80s & 90s. You probably made good money together.

But it's no longer a business model - you, your rep partner and their contacts are from a different era. These are legacy relationships with very low future value.

Your buyers have changed

Buyers of all generations have changed their behaviors, and at least half of the buyers with whom you and your rep have those chummy relationships? Well, they're retiring in the next couple years.

You know this already...but humor me. Your buyers:

  • have no time
  • don't answer calls
  • are in facilities impenetrable to cold calls
  • delete many emails without reading
  • turn to the internet first, second, third & last
  • use mobile
  • know more than many of your reps

But your sellers haven't

Here's the crux of the issue - your reps generally had some expertise but largely built their business on relationships and the breadth of their line card. They were the person that was called when their contact needed some industry answers.

The internet has changed that. The relationship piece is diminished (I know you'll argue about that just as my contention that brand is less important too) because everyone's got the world's greatest resource in their pocket.

And a line card? It just screams "I'm going to sell what I have, let me tell you what you need!" By the way, that's not terribly productive with today's buyers that hew to vendors which provide value as they research their problems....

Technology? Project creation? Let's not even go there....

Many B2B sales channel partners still use AOL email addresses, put fax #s on their business cards, have rolls of stickers to apply to the sell sheets you're supposed to print for them and don't use any sort of CRM, contact or project management or even simple email tools like Constant Contact. In many cases they don't have websites - or if they do it's often something rudimentary.

So even if you provide proven & tested email text & subject lines, for instance, they can't leverage it for your mutual benefit.

That boils down to this - in a world where most lead gen must be managed digitally, where buyers are 70% through their buying journey before they speak to a rep, and where the relationships on which they've relied are declining, they're not creating net new projects in most cases. In fact they probably complain that you don't send them enough leads.

In many cases sales channel is milking a couple key accounts, squatting on territories and costing you opportunities. There's typically little enterprise value for them to convey - the business is their rolodex. They're gradually retiring now - once that's formal, there'll be nothing to fill the void except your competitor. That's a huge opportunity cost today, and an existential business threat tomorrow.

Nietsche must have been thinking of non-performing, outdated sales channel when he said: 

That which is falling, deserves to be pushed

CAVEAT - I know! There are some fabulous, visionary, insightful rep firms out there. But we both know there are many more of the type I'm describing.

3 approaches to unproductive industrial B2B sales channel

Do you need to can them? No. Should you? Maybe. But don't just react. Plan this out.

I suggest a three prong approach to improving B2B sales channel.

  1. Existing weak channel - either drop them, or consciously acknowledge that they should be (but maybe won't because of loyalty) and immediately find and cultivate alternatives.
  2. Existing channel with potential - begin to model engagement for them using white label content programs. Essentially create proven, tested, effective marketing campaigns in a box that you execute for them using your industrial marketing automation and capture leads for both of you. They'll maintain control of their contact list (they send the first email) and they'll almost certainly end up creating projects for some of their other product lines just through conversation. 
  3. New channel - Wait a minute. Why do you need channel? If you're generating the leads and playing a substantial role in selling the projects? This doesn't mean that you shouldn't use channel, but here's your opportunity to redefine the roles and responsibilities. Create an "ideal channel partner" profile and include factors you might not have considered in the past. For instance their digital and social media footprint and reach might be a factor, as would their willingness to embrace creative new approaches to industrial trade shows and to aggressively leverage your tools like white label content campaigns.

Generate your own leads

But if your B2B sales channel no longer generates your leads, then assuming that hoping hasn't worked yet, you need to make it happen. Wondering how? It's neither simple or easy - but it's entirely possible. Here's a step-by-step process which can be implemented with the benefit of industrial experience, nuance and insight.

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