MDF Enablement Toolkit

channelMDF Enablement Toolkit

October 2012

http://www.hawkeyechannel.com/

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Contents1 MDF Enablement Toolkit Overview ...................................................................... 4

1.1 What’s included in the MDF Enablement Toolkit? .......................................... 4

2 Audit Checklist .................................................................................................... 5

3 MDF Best Practices ............................................................................................ 6

3.1 The Advantages of MDF and Co-op Programs ............................................. 7

3.2 MDF vs. Co-op ............................................................................................. 7

3.3 Best Practices .............................................................................................. 8

3.3.1 Keep It Simple .................................................................................... 8

3.3.2 Be Transparent ................................................................................... 9

3.3.3 Make It Speedy................................................................................... 9

3.3.4 Sell the Program ................................................................................. 9

3.3.5 Go Global ........................................................................................... 9

3.3.6 Automate .......................................................................................... 10

4 Funding Process ............................................................................................... 10

4.1 Fund Allocation ........................................................................................... 11

4.2 Business Plan ............................................................................................. 11

4.3 Project Request .......................................................................................... 11

4.4 Project Approval ......................................................................................... 12

4.5 Project Execution ........................................................................................ 12

4.6 Claim Submission ....................................................................................... 12

4.7 Claim Approval ........................................................................................... 12

4.8 Payment ..................................................................................................... 13

5 Legal Considerations ........................................................................................ 13

5.1 MDF ........................................................................................................... 13

5.2 Co-op ......................................................................................................... 13

5.3ContraorSG&A(Expense)Classification .................................................... 13

5.3.1 Contra .............................................................................................. 14

5.3.2 SG & A (Expense) ............................................................................. 14


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6 Metrics and Financial Considerations ................................................................ 14

6.1 Measure, Analyze and Adjust ...................................................................... 14

6.2 Total Cost of Ownership ............................................................................. 17

7 Improving MDF Utilization .................................................................................. 18

7.1 Lack of Awareness of Your Program ........................................................... 18

7.1.1 How Can Social Media Help? .......................................................... 19

7.1.1.1 Social Media Tools to Support MDF Awareness ............................. 19

7.2 Complexities and Administrative Burdens .................................................. 19

7.3ConfidentialData ........................................................................................ 19

7.4 Long Delays in Approvals and Payment ...................................................... 20

8 What to Look for in a MDF Tool ......................................................................... 20

8.1 Time to Deployment ................................................................................... 20

8.2 Total Cost of Ownership ............................................................................. 20

8.3 Market Fit ................................................................................................... 21

9 Enablement Toolkit Conclusion .......................................................................... 21


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1 MDF Enablement Toolkit Overview

Welcome!Launching a successful MDF program is not easy. Determining

how to increase utilization and effectiveness of your co-marketing

programs can be a daunting task. The hawkeye channelMDF solution

has been developed with the belief that putting the power of an MDF

toolfirmlyinyourhandswillstrengthenyourprogram.Tothatend,

we have created tools, templates and checklists that enable you to

develop and maintain a successful MDF/Co-op program in areas

such as:

¡ Fund management and approval

¡ Improved time-to-payment

¡ Simplifying compliance with tax and legal regulations

¡ Easily tracking and measuring program metrics

¡ Quickly deploying the solution—worldwide—in multi-languages and multi-currencies, with consideration of local business rules

1.1 What’s included in the MDF Enablement Toolkit?

¡ Audit Checklist—identify gaps in your current MDF/Co-op programs.

¡ MDF Best Practices—an entire section devoted to documented best practices associated with MDF/Co-op programs.

¡ Funding Process—look at each step in the process (both online and off-line).

¡ Legal Considerations—while we aren’t tax or legal experts, here are some things to keep in mind and verify for your program.

¡ Metrics and Financial Considerations—what to report, how to report it and some financialconsiderationsforyoutoworkthrough.

¡ Improving MDF Utilization—You’ve launched a program, how do you increase usage?


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2 Audit Checklist

Before launching a new MDF/Co-op program, or when trying to improve an existing

program, here is a checklist of items that may help identify the gaps.

Checklist Category Microsite

Microsite Were the objectives associated with the program clearly defined?

What behaviors were you attempting to drive/change with this MDF/co-op program?

Did you achieve the program objectives? If not, have you been able to ascertain why?

Assessment Did you get any input from participants on the types of activities offered?

Are you using MDF, Co-op or both? How do different partners takeadvantageofthemarketingoffers?Areyourbenefitsdifferent?

Whatisthepartneruptake/utilizationofthesebenefits?

Do I provide partners with the tools, training and communicationstheyneedtobestutilizethesebenefits?

HaveIengagedfieldparticipationtooptimizetheutilizationofthesebenefits?

CanIauditthebenefitstodetermineiftheyarecompetitiveandeffective?

Are my payment processes timely, global and compliant?

Do I have robust reporting in place to demonstrate/optimize benefitROI?

Is the program global? If so did you allow for local implementation of the global program?

Was this program available in multiple languages? Should it have been?

Metrics Haveyoudefinedallthemetricsyouneedtoreporttofinanceand the program owners?

Were you easily able to get to the data you needed to report?

Can you track/report by fund and activity?


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Checklist Category Microsite

Communications Did you send metric/results reports to the partners and participating account managers?

How often did you communicate with the participants?

Did you gather any survey feedback before/during/after the program period? Did you incorporate that input?

Participation Did the expected number of partners participate in the program?

What tools were they given to help them navigate the site/program materials?

Competitive analysis

Are your competitors running similar programs?

Howdothebenefitsofyourprogramcompare?

What are the weaknesses of your competitors’ program?

How did you capitalize on those weaknesses?

3 MDF Best Practices

Three out of four leading technology vendors today offer co-marketing subsidies in the form of market development funds (MDF) or cooperative (Co-op) advertising dollars to their partners. In the United States, nearly 60% of software and hardware manufacturers report that they spend at least 5% of their channel marketing budget—well over $1 million annually—on joint marketing programs. Yet industry estimates suggest that for every dollar of MDF available, at least 50 cents goes unused. Why? The reasons are as diverse as partner business models, but several common themes prevail. Many partners, for example, do not make use of these funds because they simply do not know they are available. Other partners feel that the burden of complying with program terms and conditionsoutweighsthebenefitsofco-marketingfundingsubsidies.Wesuggestwaysto maximize these funds for both vendor and partner communities, and conclude with an outline of what to look for in an MDF or Co-op solution.

Let’sstartbydefiningterminology:

¡ MDFisdefinedasfundsprovidedinadvanceofresellerproductpurchases.

¡ Co-opisusuallydefinedasadvertisingandpromotionalallowancesgrantedtopartners based on a percentage of trailing product purchases by a reseller.

Grow channel

sales

Generate demand

Build brand awareness

Extend resources & budget

Reach new customers


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3.1 The Advantages of MDF and Co-op Programs

It’s important to structure your joint marketing program based on your key business objectives and the partner types that you target, as each funding model serves different purposes and targets different kinds of partners. MDF, which are distributed to partners independent of product sales—often after completing a co-marketing plan—are ideal for partners who derive a sizable part of their revenue from selling services. These partners often take responsibility for specifying brand and are instrumental in helping develop a market for products, thus “pushing” products through the channel. These funds are also appropriate for agents and other partners who do not sell products directly. Marketing activities that build product awareness—such as seminars and workshops—are prime candidates for MDF, although most MDF programs offer a wide range of reimbursable activities from which partners can choose.

Alternately, Co-op funds—which are distributed to partners based on a percentage of trailing product sales—are more ideally suited to those partners whose primary focus isproductfulfillment.Thesepartnersdonotspecifybrandorsellservices,but“pull”products through the channel, usually in large volumes. An effective Co-op program builds on and extends the manufacturer’s demand generation effort, often in the form of advertising and other marketing activities that touch the end user directly.

3.2 MDF vs. Co-op

Both MDF and Co-op can be an effective use of channel support dollars if they are used correctly with the right kind of partners.

MDF is most effective for partners who help create—or “push”—a product by specifying brand. Providing MDF funds allows these partners to spend ahead of sales, helping togrowthemarket.Typically,therangeofactivitiesthatqualifiesforMDFiswideandmanufacturer support is often discretionary.

Percentage-based Co-op programs are appropriate for partners who “pull” product through the channel. These kinds of resellers provide a predictable sales volume that lends itself well to a percentage-based model. With Co-op, the advertising tools of these partners essentially become an extension of the vendor’s own demand generation campaigns.

It can be appropriate, however, to use MDF for “pull” partners when introducing a new productwithoutarevenuerun-rateuntiltheflowofrevenueisestablished.

Push

Co-op and MDF should be used

differently based on “push” versus “pull” expectations of the partner’s business

model.

Services Partners

Fulfillment Partners

Mixed Model

Partners

Pull


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3.3 Best Practices

Designing and deploying a new MDF or Co-op program—or strengthening an existing one—canbeasignificantchallengefortechnologyvendors,butthebenefitsaretremendous for vendor and partner communities alike. Here are some best practices based on years of working with leading technology companies to grow their channels, as well as considerable insight from partners. According to a 2009 survey, partners in the UnitedStatesandCanadapreferMDFandCo-opprogramsthathaveefficientprocessesfor both applying for funds and receiving payment. Their wish list includes:

¡ Clear process with easy-to-understand rules

¡ Fast payment processing

¡ Online status/tracking and updates

¡ Payment of claims in cash, not credit

¡ Moreflexibleactivities—trustthepartnertoknowitsspaceandhowtomarkettoit

¡ Vertical-friendly options

¡ Solution-friendly options

3.3.1 Keep It Simple

Becausepartnersreportthatmanyprogramsaresimplytoodifficulttouse,thefirststepis to review your program from the partner point of view. Is the process to gain approval for projects and qualify for funding clearly documented? If partners have questions or needhelp,arethereeasy-to-findresources?Ifyourprogramisweb-enabled,areprogramguidelines easy to download and print for reference?

A common frustration point for partners is a lack of integration between the steps in the co-marketing process. For example, if your program requires that partners develop a marketing plan using an online tool, consider integrating that application with your MDF application so partners don’t have to re-enter key data. Better yet, look to provide an integrated marketing dashboard or at-a-glance summary feature, so partner fund administratorscanfindstatusinformationforallco-marketingactivitiesinoneplace.

Another common partner complaint centers on proof-of-performance (POP) requirements. Partnership, after all, is about working together toward a common goal in a spirit of trust, so when manufacturers ask partners to submit multiple documents to prove that an approved marketing activity actually took place as planned, it understandably can lead to dissatisfaction. From the vendor’s point of view, documentation is critical for audit purposes. From a partner’s point of view, documentation is a hassle.

Toresolvethisconflict,reviewyourPOPrequirementstoensuretheyareasminimalas possible and easy to comply with. One manufacturer we know began its POP audit by rewriting its program documentation to make sure partners understood the reason behind the POP request—to build an audit trail for accounting purposes—not to question partners’ veracity or judgment. Next, the manufacturer reviewed the requirements for


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each activity and determined the absolute minimum number of POP requirements needed. On average, most marketing activities required no more than two pieces of POP documentation. Finally, the company provided a list of options for POP documentation, so partners could choose what to submit for review.

3.3.2 Be Transparent

Don’t leave partners in the dark about the status of requests, claims or payments. Set clear expectations about how long it will take to approve a request, approve a claim or receive payment. Better yet, automate the process to reduce processing times and close gaps from the vendor’s perspective, as well as to enable partners to view—online, at a glance—where they stand with their projects, claims and payments.

3.3.3 Make It Speedy

The operational benchmark, from claim approval to payment in hand, is three to four weeks. While regional requirements can add complexity and time to this process, the key to tightening the payment timeline is to deposit funds directly into the partner’s designated account whenever possible. Deploying an electronic funds processing solution can reduce timetopayoutbyasmuchas66%.Thebenefitsofgoingdigitalaremultiple:

¡ Provides an audit trail for partners and administrators alike

¡ Makes it possible for partners to choose the currency and bank account for deposit

¡ Makes it easy to measure the performance of funds disbursement for reporting, metrics and remediation

3.3.4 Sell the Program

CommunicatingthebenefitsofanMDForCo-opprogramisanongoing,continuousprocess. Treat your program like a product—tell your partners what’s in it for them. Demonstrate the value of the program in terms that resonate with them—greater return on investment (ROI), increased sales and ease of use—and consider incentivizing them to evangelize the program to others. Keep them updated on what’s new and useful—new features, new co-marketing opportunities and the like. And provide a range of training tools, from webinars and virtual demos to online help tools. If your application supports online account statements, consider using alerts, RSS and other mechanisms to promote them.

3.3.5 Go Global

WhiledeployingaglobalMDFprogramoffersefficienciesandorganizationaladvantages,taking a cookie-cutter approach to activities, funding levels and even customer support can hinder success. The goal is to create a global framework that can easily be tweaked tobestfitlocalneeds.Ifyouarepilotinganewprogram,considergoingbeyondyourownbackyard so regional considerations are built in from the ground up.


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Engageregionalprogrammanagersandfieldmarketingstafftoreviewandcommentonglobal program guidelines and business support processes. Ensure that there are people and processes in place to communicate and deliver on local business requirements. And remember that localization means more than just language translation. In addition to heeding local government regulations and requirements, ask (and listen to) your regional colleagues about how partners in their regions like to receive communications, training and ongoing support. Monitor messages and images for cultural appropriateness.

3.3.6 Automate

With the trend toward offering channel applications as a service rather than stand-alone software, automating MDF and Co-op processes has become affordable. If it’s done right, making MDF and Co-op programs available to partners online can simplify project and claim submissions with step-by-step instructions, drop-down menus, real-time validation and prompts to serve information in a user-friendly way. These applications can streamline processes through integration with other co-marketing programs and resources, like online business planning tools, collateral builders and payment processing solutions. Triggered communications and online status reports help align expectations by clarifying processes and timelines so partners aren’t feeling left out of the co-marketing process.

Forprogramadministrators,goingdigitalcanalsoresultinincreasedefficiencies,reducedtimelines and improved partner satisfaction. Online applications can provide regional control over funding, approvals and back-end processes. Program metrics are also easier to track and measure.

4 Funding Process

A web-based MDF solution optimizes results across the entire co-marketing process, shown below. Let’s look at each step of the process:

FundAllocation

Business Plan

Project Request

Project Approval

Project Execution

Claim Submission

Claim Approval

Payment



4.1 Fund Allocation

Partners can participate in multiple fund categories, based on their characteristics. The important decision is how you want funds allocated to a program. Think about:

¡ Is the program strictly Co-op, where partners are pre-assigned dollars?

¡ If you are using MDF, think about how you want MDF fund categories assigned. Some ways you can create funds are by:

¡ Product line

¡ High-value partners

¡ Specific vertical markets

¡ Regions

¡ Partner type

¡ Partner tiers

4.2 Business Plan

A business plan can be one of the tools used to change the relationship with a partner from tactical to more strategic and long-term. A business plan that allows the partner to gain your agreement on a series of activities will allow a fuller, more holistic view of desired marketing activities. Once a business plan is approved, it should feed the approved activities and improve the partner’s experience with the tool.

4.3 Project Request

If you are not using a business plan, or if the partner chooses not to complete a project plan,theprojectrequestisthefirststeptorequestfunds.Somethingstothinkabout:

¡ How easy are you making it for your partners to take advantage of marketing activities that make sense for both of your companies?

¡ Can they order these activities as part of your MDF site?

¡ Do you have a network of vendors who can help them be successful with their marketing programs?

¡ Do you fund activities using pre-approved vendors at a higher rate than other activities?

¡ Make partners think through and enter ROI at this step. It doesn’t make sense for them to spend time on an activity that can’t make money and it sure doesn’t make sense for your MDF dollars to be wasted. An ROI calculator is a great way of ensuring campaign viability has been thought through.



4.4 Project Approval

Asyouthinkaboutyourapprovalworkflow,thinkaboutthevolumesthatwillrunthroughthetool,andmakesureyouaresettingupanapprovalprojectworkflowthatissustainable for the amount of activity you will need to manage.

¡ Doyouwantfirst-levelapprovaltobehandledbyasupportteam?Areyourrulesstraightforward enough for this to be feasible?

¡ Are there activities that can be pre-approved?

¡ What happens when one of the approvers goes on vacation? Who will act as a proxy?

¡ Shouldtherebeadifferentapprovalworkflowforprojectsoveraspecifieddollaramount?

¡ Are projects being approved in a timely manner? Can you pull reports and see where in the process you are getting “stuck” and make corrections?

4.5 Project Execution

ThepartnerhandlesthisportionoftheMDF/Co-opworkflowoff-line,butconsiderlettingthe partners use pre-approved (maybe even pre-funded) vendors to ensure a successful campaign.

4.6 Claim Submission

This should be a simple process, since the partner already has approval for the project and is now just submitting their POP and updated estimated ROI.

4.7 Claim Approval

Similar to project approval, think about the volumes that will run through the tool and makesureyouaresettingupaclaimapprovalworkflowthatissustainablefortheamountof activity you will need to manage.

1) Doyouwantfirst-levelapprovaltobehandledbyasupportteam?Areyourrulesstraightforward enough for this to be feasible?

2) Are there activities that can be pre-approved (especially if they are done by an approved vendor)?

3) What happens when one of the approvers goes on vacation? Who will act as a proxy?

4) Shouldtherebeadifferentapprovalworkflowforclaimsoveraspecifieddollaramount?

5) Are claims being approved in a timely manner? Can you pull reports and see where in the process you are getting “stuck” and make corrections?



4.8 Payment

The partner completed the project, submitted the required POP and you have approved the claim. Now what? It’s payment time. Payments can be either Credit Memo, payment to a bank account or some combination of the two (depending upon partner type). The crucial piece is a timely payment in their currency of choice. The best-planned MDF programs can fail if partners do not see timely payments and appropriate communications.

5 Legal Considerations

Both MDF and Co-op carry some liability for vendors. It’s essential to know and understand the legal considerations of each funding model. Once you know and understand these guidelines, you can build simple programs that streamline and automate processes while ensuring compliance with these regulations. Regardless of funding model, technology manufacturers operating in the United States are required to account for the use of funds as outlined by the Financial Accounting Standards Board (FASB). They are also required to abide by anti-trust and fair trade practice laws—such as the Robinson-Patman Act—mandating that manufacturers treat all partners equally. In the UnitedStates,ifacourtfindsevidenceofdiscrimination,itcanresultinpenaltiesofuptothree times damages. Fair trade practice laws in other countries carry similar weight.

5.1 MDF

In the case of MDF dollars, the manufacturer must be able to document that the use of fundswereappliedtoaspecificmarketingactivity—notapplieddirectlytothebottomline. This documentation requirement places a considerable burden on both partners and manufacturers and thus makes it all the more important to make the effort worthwhile.

5.2 Co-op

From a legal perspective, determining Co-op is straightforward. The percentage of salesdistributedtopartnersmustbeappliedequallytoallpartner“classifications.”If,for example, a vendor chooses to offer a higher percentage to a platinum partner than a gold partner, the reasons for doing so need to be clearly documented. Giving different percentages to “like” partners is considered discriminatory and can be grounds for legal action. Paying out Co-op as a straight rebate and not using it to recover actual marketing costs can also be problematic.

5.3 Contra or SG&A (Expense) Classification

As mentioned earlier, in the United States, MDF and Co-op must be accounted for based upon generally accepted accounting principles and the guidelines outlined by the Financial Accounting Standards Board. This list shows which activities can be expensed and which cannot.



5.3.1 Contra

¡ Product discounts

¡ Payment terms

¡ Volume rebates

¡ Sales incentives and rebates

¡ Deal protection

¡ Price protection

¡ Trade-in programs

¡ Return policies

¡ Trainingandcertification

¡ Demo equipment

¡ Funded headcount

5.3.2 SG & A (Expense)

¡ Advertising (web, print, TV)

¡ Catalogs

¡ Direct mail, email, e-newsletters

¡ Seminars and webinars

¡ Telemarketing

¡ Customer events

¡ Sales and channel meetings

¡ Sponsorship

6 Metrics and Financial Considerations

6.1 Measure, Analyze and Adjust

Like all marketing activities, metrics are critical to understanding what works and what doesn’t. Different program stakeholders—from partners and program managers to marketing directors and executives—need different kinds of information.

Closed-loop reporting, which requires partners to estimate the results of activities when seeking project approval and then revisit their estimates during the claiming process, canhelppartnersrefinespendingandactivityassumptionsforfutureinvestment.Inturn,program managers can use these metrics to focus on those marketing activities that provide the greatest value and reduce funding levels for those that don’t. Website analysis canfurtherrevealabandonmentratesonspecificpages,whichcanpointtoareasforimprovement.

industry benchmarks

¡ Time from claim to payment – 3 weeks

¡ Administrative cost / projext – $20-$30 per project

¡ Program cot vs. total value – Less than 1%

¡ Fund utilization rate – 12%-50% industry range



Programdirectorscanlookatmetricsthatmeasuretheefficiencyofprocessesandperformance, such as the percentage of funds go unclaimed, how long it takes to resolve customersupportissuesandhowmanyqualifiedpartnersparticipateintheprogram.Andexecutive management will want to analyze ROI for the program overall.

In a world awash in data, it’s important to remember that metrics are most valuable if they help determine trends rather than focus on past performance. Choose no more than a dozen key metrics to track and revisit on a regular basis (quarterly, for example) to identify issues and take action. Make sure each metric has a clear process and owner.

¡ Program managers look at metrics to understand which activities are performing and to answer questions such as which marketing activities provide the highest rate of return.

Activity Metrics

Telemarketing Campaign ¡ Number of calls made

¡ Cost of follow-up per lead

¡ Number of meetings secured

¡ Response rate = Number of responses/sales

¡ Number of total contacts

Collateral Literature & Sales Tools

¡ Number distributed

¡ Cost per unit

Events Tradeshows, Seminars, Exhibits, Partner Sales Meetings

¡ Number of attendees

¡ Cost per attendee

¡ Number of registrations

¡ Number of leads

¡ Projected revenue

Sales Incentives Contests, Spifs, Floor Events

¡ Number of achievement

¡ Cost per achievement

¡ Number of participants

Training & Certification ¡ Number of attendees

¡ Cost per attendee

¡ Numberofcertifications

Demo Equipment ¡ Number of demo units

¡ Cost per unit

Funded Headcount ¡ Percentage of MBO achievement

¡ Percentage of revenue growth



¡ Marketing directorslookatmetricstomeasureprocesses,efficienciesandeffectiveness. They want to understand whether they are leaving money on the table andwhethertheirprogramisinfinancialandlegalcompliance.

Measurement Metrics

Claim Activity ¡ Claimed dollars + Allocated dollars

Beginning dollars + Adjustment dollars

¡ Total claims submitted

¡ Total number of claims denied (compliance)

Fund Utilization ¡ Funds accrued

¡ Funds expired

¡ Outstanding liability

¡ Unclaimed funds at end of reporting period

Prior Approvals ¡ Total pre-approvals submitted

¡ Total pre-approvals accepted

¡ Total denied

¡ Total on hold

System Efficiency ¡ Total calls to channel management

¡ Response time on calls

¡ Total number of emails to channel management

¡ Response time on emails

¡ Length of time from claim approval to payout

¡



¡ Executiveslookatmetricstomeasureprocesses,efficienciesandeffectiveness.They want to know if a program is helping them gain market share or outsell the competition.

Measurement Metrics

Program ROI ¡ ROI=totalgrossprofit/totalcostofprogram

¡ Revenue per invested dollar (RPI) =Revenue generated by activityCost of activity

¡ Total sales

¡ Number of leads generated

Fund Utilization ¡ Number of active MDF partners Total number of MDF partners

¡ Number of partners using tool

¡ Total hits to site

System Efficiency ¡ Total calls to channel management

¡ Response time on calls

¡ Total emails to channel management

¡ Response time on e-mails

¡ Length of time from claim approval to payout

6.2 Total Cost of Ownership

Some solutions offer low up-front costs, but require additional integration work to link to back-end systems. The cost of subscription solutions can increase exponentially if the provider’s pricing model charges per person. When making a decision, think about the following:

¡ Does the provider offer integration and consulting support?

¡ Does the provider offer global program management, help desk support and claims-processing services?

¡ Who will handle customer support issues?

¡ Does the solution support the entire process—from planning to funds disbursement—or will you need to supplement it with additional applications and resources?

¡ Ifyourprocessrequiresadditionalfunctionality,willitbedifficulttocustomizeorupgrade the application?



7 Improving MDF Utilization

Why do funds go unused? The reasons are varied, but generally they fall into one of these categories.

¡ Lack of awareness of your program

¡ Complexities and administrative burdens make it not worth the potential return

¡ Processes do not engender trust, therefore the partner does not want to provide any confidentialdata

¡ Long delays in approvals and payment

How do you overcome each of these? Read on.

7.1 Lack of Awareness of Your Program

Selltheprogram—tothefieldandpartnersalike.

¡ Engage channel reps in the process from the start

¡ Demonstrate the value

¡ Increase adoption with training, education and incentives

¡ Proactive, timely, ongoing communication

The right communications plan will go a long way toward ensuring that your partner community knows about and understands your program. There is a series of communications associated with the launch and ongoing support of a rewards program. Some communication is automated based on status changes (more to come on that), but others will occur outside the tool.

Mixing these types of communications is important since you will want to communicate to your target audience throughout the lifecycle of the rewards program. Think about these areas when developing your communications strategy.

¡ Have a clear purpose

¡ Know your audience

¡ Listenfirst

¡ Be real

¡ Be innovative and interactive

¡ Leverage social syndication

¡ Make a commitment

¡ Add social media elements to marketing efforts to gain experience



7.1.1 How Can Social Media Help?

¡ If your company is already using social media, it may make sense to help spread the word about your MDF program and capabilities. Some things you can consider are:

¡ Live chat features

¡ New program and campaign announcements

¡ Success stories

7.1.1.1 Social Media Tools to Support MDF Awareness

¡ Blogs and microblogs

¡ Wikis

¡ Social networking

¡ Video sharing

¡ Message boards

¡ Forums

¡ Podcasts

¡ RSS

¡ Communities

7.2 Complexities and Administrative Burdens

Ask too much of the partner and they may feel the program is not worth their time; ask too little and you don’t have a program that meets SOX compliance. As a rule of thumb, ifyouarenotgoingtousetheinformationandit’snotneededfromalegalorfinancialrequirement, don’t ask your partners to provide the information.

Makeiteasyforthemtouploadback-upfiles,ensurethesiteiseasytouseandletthemsimply print out or download any information they need.

See section 3.3.1 for more information.

7.3 Confidential Data

Asinanyprogram,askingapartnertoprovideconfidentialdatarequiresahigh-leveloftrust. MDF programs are not only asking for the names of end-customers, you are asking partners to disclose their marketing strategies. To mitigate concerns you can:

¡ Addressconfidentialityinyourtermsandconditions

¡ Of course, always work with your partner from a position of trust so they don’t question providing the data



7.4 Long Delays in Approvals and Payment

The operational benchmark, from claim approval to payment in hand, is three to four weeks. While regional requirements can add complexity and time to this process, the key to tightening the payment timeline is to deposit funds directly into the partner’s designated account whenever possible. Deploying an electronic funds processing solution can reduce timetopayoutbyasmuchas66%.Thebenefitsofgoingdigitalaremultiple:

¡ Provides an audit trail for partners and administrators alike

¡ Makes it possible for partners to choose the currency and bank account for deposit

¡ Makes it easy to measure the performance of funds disbursement for reporting, metrics and remediation

Remember, the longer you take to approve a claim, the more likely you are to create a very unhappy partner. Set your claim approval and payment service-level agreements in your program documentation and stick to them. Watch your turn-around-time metrics, adjust your processes associated with tasks or individuals creating delays and keep your partners informed of progress towards payment.

8 What to Look for in a MDF Tool

Today’s channel marketing organizations have many options to consider when choosing an MDF or Co-op solution. In addition to features and functionality, here are a few things tokeepinmindwhenlookingforthesolutionthatbestfitsyourneeds.

8.1 Time to Deployment

Fromstarttofinish,launchinganewMDForCo-opapplicationcantakeaslongastwo years—or as few as eight weeks. Factors to consider include the availability of internal resources, the time it takes to customize out-of-the-box solutions and the time-consuming but necessary legwork of gaining buy-in from internal stakeholders like accounting and IT. Be realistic about how much time you have to devote to implementation and the resources you will be able to commit to the project.

8.2 Total Cost of Ownership

Some solutions offer low up-front costs, but require additional integration work to link to back-end systems. The cost of subscription solutions can increase exponentially if the provider’s pricing model charges per person. Does the provider offer integration and consulting support? What about global program management, help desk support and claims-processing services? And who will handle customer support issues? Does the solution support the entire process—from planning to funds disbursement—or will you need to supplement it with additional applications and resources? And what if your processrequiresadditionalfunctionality?Willtheapplicationbedifficulttocustomizeorupgrade? If changes are required, who foots the bill—you or your provider?

Choices are many, ranging from enterprise application suites to stand-alone applications and from custom solutions to subscription-based services that offer pay-as-you-goflexibility.Besuretoexploreall of the options, ask critical questions and select the solution thatbestfitsyourneeds—today and for years to come.


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8.3 Market Fit

Consider not just how many partners currently qualify or use your MDF or Co-op solution, but your future needs as well. Will a better process increase the number of partners who want to participate in the program? Are you looking for a global solution that can be deployed in multiple regions? If so, does the solution support multiple languages and currencies?

9 Enablement Toolkit Conclusion

Thankyoufortakingtimetoreadthroughthisdocument.Wehopeyoufindtheinformation useful. We know that launching a successful MDF program is not easy and we hope these tools help you in your MDF/Co-op program planning.

Please let us know if you have any questions or would like to have more discussions with hawkeye about your MDF program.


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MDF Enablement Toolkit

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