The coming year will usher in a new, close-knit relationship between manufacturers and resellers based on the rapidly growing volume and frequency of data available from the channel. Greater adoption of sophisticated channel data management (CDM) technology — which helps manufacturers get accurate and granular data about sales and inventory from their distribution and resale partners in real-time — will transform channel sales. Instead of companies setting channel strategy based on rough estimates and waiting for quarterly results to make adjustments, manufacturers and resellers will use a constant feed of channel data to continually and proactively adjust and optimize channel marketing, inventory management, and sales initiatives.
This new visibility to channel data will enable closer alignment between manufacturers and resale partners on strategic goals, performance metrics, and incentives. Like most technological advances, the end result will be greater efficiency and productivity (i.e., revenue), but getting to that point will require manufacturers and resellers to adapt to a new channel paradigm. Companies will need to increase their focus on channel strategy and operations now that they have actionable information coming from their partners. In turn, resellers will need to become more flexible to changing market demands and sales strategies to meet manufacturer’s goals for maximum channel revenue.
Manufacturers Add New Channel-Specific Roles And Technologies
Companies that rely on resale partners to reach end customers will increase investments in technology to track data from the channel, along with beefing up and integrating solutions focused on optimizing marketing, sales execution and incentives, inventory management, and financial records. CDM platforms provide companies with a foundation of decision-grade data by automatically collecting, cleansing, and validating sales and inventory information from partners. But this data also needs to be shared throughout the organization and applied to specific processes to deliver tangible results. To turn channel intelligence into action, companies will look into integrate their CDM platform with solutions for specific processes like Sales & Operations Planning, forecasting, price execution, and supply chain management.
Many manufacturers will also create new channel-specific roles within their organization in 2017. We have already witnessed this trend with industry leaders We have already witnessed this trend with industry leaders such as HP, Seagate, Microsoft, Samsung Electronics, etc. that have added new roles focused specifically on Channel Data Management. The technology research firm IDC reported at the beginning of this year “leading companies are starting to appoint global heads of channel data management,” and as the technology and data ecosystem grows, large enterprises will invest in entire new departments to plan and execute more advanced channel strategies.
Channel data can drive strategic decisions across a wide array of business processes
More Nimble Resellers Benefit From The Faster Pace Of Channel Business
Channel resellers that adopt a more nimble approach will benefit most from manufacturer’s new data-driven approach to sales and marketing initiatives. With the increasing role of real-time data in evaluating channel performance and setting new strategies, channel partners will need to achieve greater flexibility to respond quickly to new goals. Resellers that can align quickly with manufacturers on a new campaign that targets a recently uncovered white space in the market, for example, will realize greater revenue opportunities.
At the same time, CDM technology will continue to automate a greater portion of the partner reporting process, freeing up resellers to focus less on administrative busywork — such as filling out sales incentive forms or manually entering inventory data — and spend more time on strategy and actual selling. Increasingly automated reporting processes will also benefit resellers by delivering much faster rebate and incentive payments.
The transformation of channel sales is already underway, and 2017 will bring manufacturers and resellers into closer alignment. The companies that adapt to the new data-driven approach will be able to respond to faster to new opportunities in the market and resolve inefficiencies that have traditionally gone unnoticed due to “channel blindness.” With an estimated $5 trillion in annual sales going through indirect channels, the potential benefits are enormous.