The 4 why’s of an incentive & loyalty program 

No one doubts the value of a channel incentive program: your selling partners respond with increased productivity. But beyond that lofty and somewhat abstract objective, many marketing and channel program professionals struggle to articulate the raisons d’etre of an applied incentivization strategy. And knowing – and being able to articulate – those reasons is fundamental to designing and executing incentive programs that work:

1. You are competing for attention … and ultimately loyalty. Channel partners are not immune to information overload. They are getting more and more information from more and more suppliers, the result being you’re running the risk of being seen as a commodity. Couple this with the time squeeze represented by today’s “professional ADD syndrome” ( … well, you’re not only losing their attention, you’re losing their business. You have to stand out, and you have to stand out fast. Companies that wed channel partners to their brand via a strategic incentive program stand to gain not just their attention, but their long-term loyalty.

2. You need a [short-term] booster rocket. Yes, increased productivity is a well-understood given. But it’s a generalization. More specifically, sometimes you may need to amp sales of a particular product (perhaps for a product launch), or acquire a new type of customer (e.g., vertical industry), “make a number” (quarterly earnings) … or simply reduce looming overstock. Incentive programs are your rocket fuel.

3. You have [longer term] strategic waters to navigate. Each year, companies lay out a new set of strategic goals and objectives. Changing course to achieve these can sometimes be a daunting proposition. And when it involves your channel ecosystem, that can be like steering a battleship. You can wield incentive programs as a guiding rudder. A channel chief for a tech company put it succinctly: “We do incentive programs to engender market maneuverability, i.e., to get our channel partners to go where we want them to go.”

We’ll cover these 3 business case aspects in more detail, along with a key 4th (you need to “sensorize” your channel ecosystem) in an upcoming whitepaper and video. To keep apprised, subscribe to our newsletter here.