Making eCommerce Work for You (and Your Channel)
Geoff Surkamer, senior group vice president at License Technologies Group
View as a PDF.

Do you want to sell software online but are concerned about alienating your channel? Are you already selling online but worry about the impact on your partner relationships? These are common, understandable concerns.

It helps you provide customers with flexible options for buying your software. It enables them to easily trial software at their convenience. If they decide to buy, they can immediately download the software--and you can immediately recognize that revenue. Selling online extends your reach to global markets and new channels. If executed properly, it gives you an additional revenue stream and can even increase your renewal rates.

But, selling online can be rife with risks--particularly for your channel. You need to assure your partners that you're not cannibalizing their business by selling direct to customers, and that you're not directing an "unfair" portion of your resources to online revenue generation.

The good news is that you can mitigate these risks if you build your eCommerce strategy with the channel top-of-mind. The first thing to do is shore up your channel relationships. Make sure your programs are deemed valuable by your partners, that partners are adequately compensated. If your revenue is 80% channel-derived, allocate your marketing dollars proportionally. Equally important, explain your online strategy to your partners. If they understand how they fit in your larger sales strategy, the perceived threat posed by your eCommerce efforts will dissipate. Additionally, look for ways to maximize synergistic opportunities with your channel. This could include using online tools, such as branded storefronts or guided selling tools that facilitate partner sales and generate incremental revenue for everyone, and co-marketing with channel members to upsell and cross-sell customers who bought complementary products online.

Another way to ease partner discomfort is to segment your marketing initiatives according to best-fit sales channels. For instance, it may make sense to target certain customers for partner-purchasing and others for online purchasing. Your campaigns should point customers to the most appropriate venue based on criteria such as customer type (SMB, consumer, enterprise), number of seats, and type of offering (shrink-wrap or customized).

Finally, to create an online selling system that helps the customer while favoring the channel. Consider doing the following:

• Selling products online at list price so you don't compete with channel partners.
• Selling smaller quantities of products, such as a 100-seat limit and shrink-wrap or License Packs only, and supporting a partner referral model that provides incentives such as points/rewards for channel members who drive sub-100 seat sales to your site.
• Including a "how to buy" button with a drop-down menu that enables customers to view purchasing options, such as buying from specified partners or buying directly from you online. This will enable customers to use your site for educational purposes and easily link to their preferred reseller for purchase. You can also let customers buy directly from your site while crediting a particular reseller for the sale. (Customers will be more likely to credit a reseller if that reseller provides them with points or other incentives.)
• Allowing for "discounted" advertising on the site. To make sure this is neutral offer space for all the major resellers in a particular segment.

Now that you've incorporated the channel into your eCommerce strategy, you can focus on the online selling system itself. Build an eCommerce system that adheres to these 10 best practices:

1. Ability to handle complex pricing options, including discounts, promotions and specials.
2. Native support of global transactions, including price, languages, and tax options.
3. Speed and ease of use, making it simple to set up a storefront and upload pricelists and bits.
4. Flexible distribution including digital and physical fulfillment.
5. Customer-facing inventory insight (backorders), as this can make or break a sale.
6. Several payment methods, minimally the ability to capture major credit cards.
7. Self-managed capabilities, which let you quickly make design and content changes.
8. Robust traffic and sales reporting options, such as report extracts and dashboards.
9. Well-documented APIs to support data input and output, allowing for integration control over key data sources and supporting both self-serve and fully managed options.
10. Built upon advanced technology (although not bleeding edge since new technologies need time to work out the bugs) that is scalable, upgradeable and extensible.

You don't have to choose between satisfying customers by giving them flexible online commerce options, and satisfying the channel by directing your efforts exclusively towards them. You can broaden your sales without alienating the channel. In fact, with the right eCommerce strategy and system, you can reinforce your channel relationships, creating a win-win for you, your partners and your customers.

Geoff Surkamer is senior group vice president at License Technologies Group (LTG).
LTG is the leading software licensing services provider for software publishers and their partners. LTG's software licensing and technology expertise, global capabilities, and extreme customer focus provide publishers and their partners with industry-leading software licensing and eCommerce solutions including licenselink® and commercelaunch™. LTG solutions allow publishers to grow their businesses faster by optimizing operations, driving new revenue opportunities, and enhancing partner and end-user experiences. For more information, visit www.licensetech.com

< read other points of views... >

Demos

Automate. Manage. Track.< licenselink demo > Launch. Control. Sell.< commercelaunch demo >

Clients We Have Worked With

Client Testimonials

Strategic Partners