Partner Value Proposition
When it comes to winning over potential partners, showing them a sleek demo or a list of product features might seem like the obvious route. But here's the surprising truth: your product isn't the star of the show. What truly captures a partner's attention is understanding how collaborating with you will elevate their own business success.
While your product's features are important, they're not the primary focus when it comes to attracting and retaining valuable partners. Let's dive into what really matters in creating a Partner Value Proposition (PVP) and how it differs from a Customer Value Proposition (CVP).
Understanding Partner Value Proposition (PVP)
A Partner Value Proposition is a clear statement that outlines the benefits and value a partner can expect to gain from collaborating with you. It's not about what your product does; it's about how partnering with you will make your partner's business thrive.
So, instead of presenting a list of features and benefits, focus on demonstrating the following key aspects to your potential partners:
Revenue can be generated in several ways:
- Commissions: Earned by reselling or referring your products.
- Additional Services: Provided by your partner based on your product.
- Increased Sales: Additional sales of your partner's products due to the partnership.
- Customer Retention: Enhanced customer retention driven by the benefits of the partnership.
- New Customers: Access to new customer segments, industries, or regions.
- Upsell Opportunities: A long upsell path to additional products or features added to the partner's portfolio. Which also leads to higher retention
- Speed to Market: Faster speed to market, where partnering is the better option in a build, buy, or partner decision*.
- Increased Efficiency: Benefits from introducing your technology into the partner’s internal processes, leading to greater efficiency.
- Better Competitive Positioning: Enhanced competitiveness by leveraging innovative technology, making your partner more attractive in the market.
*🔗 Deciding Between Build, Buy or Partner
Partner Value Proposition vs. Customer Value Proposition
To truly understand the power of a PVP, it's essential to distinguish it from a Customer Value Proposition:
Aspect | Partner Value Proposition (PVP) | Customer Value Proposition (CVP) |
Audience | Business partners | End customers |
Focus | Benefits of partnership, mutual gains (1+1=3+) | Benefits of products/services to the customer |
Motivation | Financial returns, market expansion, enhanced offerings | Solving customer problems, and improving satisfaction |
Communication | Strategic and business-oriented | Customer-centric, focusing on features and benefits |
Crafting and Communicating a Partner-Centric Value Proposition
Remember, partners will collaborate with you when it benefits their business. At this point, it is considered as given that you understand your partner's business. There are goals, challenges, and growth opportunities.
To create and effectively communicate a compelling Partner Value Proposition (PVP), follow these steps:
Quantify the financial benefits of partnering with you
Consider the following recurring and non-recurring positions:
- Commissions from license fees for referring or reselling your product
- Initial setup services performed by the partner, such as: onboarding, implementation, custom developments & integrations, etc.
- Ongoing product-related services performed by the partner, such as: customer support & consultations, technical maintenance for customer integrations, etc.
- Recommendation: Suggest additional services or products your partner could sell or upsell due to the partnerships with you.
You can find a tool to calculate your partner business case here.
🔗 Partner Business Calculator (paid)
Identify and list additional benefits and partner program features
Benefits of partnering with you can be financial and non-financial.
- Reduced customer acquisition costs
- Portfolio diversification
- Long-term growth opportunities
- Increased customer lifetime value
- Operational efficiency gains
- Improved customer retention
- Enhanced market reach
- Enhanced product offerings
- Access to new customer segments
- Co-marketing opportunities
- Increased speed to market
- Access to innovative technologies
- Strengthened brand reputation
- Stronger competitive positioning
- Increased brand visibility
- Reduced expansion risk
- Better customer insights
- Reduced operational risks
- Improved scalability and flexibility
- Better alignment with industry standards
- Enhanced data security and compliance
- ….
The list above are only examples. Do research on the “wants” and “needs” of your potential partners. Find out which aspects resonate most and address your potential partners’ current challenges. Then pick a shortlist of max. 3-4 of the most compelling and resonating arguments for your partners.
Address fears and uncertainty of your potential partners
Partnering involves unlocking resources and making a significant long-term commitment. Potential partners need assurance that they are making the right decision. It is equally important for you to ensure that your partners are confident and comfortable committing to the partnership, as you too will be investing your time and resources.
Showcase your experience by highlighting successful partner case studies and referencing established clients. Provide concrete examples of partner support and outline a well-planned Partner LifeCycle Management. Clearly define the support structure you offer to partners and detail the step-by-step process for onboarding and collaboration. For more details check out this guide on Partner LifeCycle Management.
Outlining these elements can significantly boost confidence and clarity for prospective partners.
Communicate your Partner Value Proposition effectively
Consider creating a Partner Value Proposition (PVP) one-pager or a presentation deck that can be shared during meetings or included in follow-up emails. This should summarize the key benefits, financial opportunities, and support structures associated with partnering with you.
Reach out if you need help with crafting your Partner Value Proposition.
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