This article originally appeared in Channel Executive Magazine.
Q1: Are vendor incentive programs (MDF, co-op, spiff s, rewards) valuable and important to the partner community?
LIBERMAN: They’ve been really valuable to us over the years. A common offering is MDF and most vendors will chip in at least 50 percent of the cost. We hosted a large event in New Mexico and one of our vendors inadvertently paid the entire $4000 cost. When we tried to reimburse them, they said: “don’t worry about it.” Every vendor that I see at the shows will tell you that they frequently have unspent MDF funds every single year, and they just can’t get their partners to use enough of them.
GUIM: These incentive programs can be very valuable, but it depends on the partner. Not all partners fully utilize the incentives, or they just don’t know about all the opportunities that are available to them. An incentive that is important is the MDF funds; they can be very valuable. Spiff s are OK; they’re just giving you a little bit of extra money, but I think MDF funds are the most important incentive programs out there.
Q2: What have been your experiences with incentive programs?
LIBERMAN: One vendor used to have an excellent incentive program, as part of a fabulous partner program. It was like using a cash-back credit card, returning roughly 2 percent of total spend. It later morphed into something of a debit card; the payback got smaller and smaller, until they actually canceled it without notification, “stranding” points on the card. This degradation was rapid and profound and mirrored by the overall collapse of their partner program. From poorly outsourcing tech support to the sudden retirement of all partner reps, they utterly abandoned the channel. Our call was not very important to them.
GUIM: In December 2016, we had a prescreening of “Star Wars: Rogue One.” We partnered with Cisco Meraki, D&H, and Datto for this event who provided MDF funds. It was such a great success that we did the same thing again December 2017, with “Star Wars: The Last Jedi.” For this film, we partnered with Cisco Meraki, D&H, and Autotask for MDF funds. There were about 180 people who attended each event. Over the last two years, we have been able to show a return on investment with the MDF by converting appointments from the events to actual sales.