Why rewards and recognition works wonders: understanding the psychology of channel partner motivation and engagement

Employee morale is critical in attracting and retaining talents. When confidence is low, it can lead to reduced productivity and employee satisfaction. 

The impact of robust channel partner engagement on sales volume, market share, brand reputation, and customer engagement is enormous. The performance of channel partners affects employee engagement as they serve as go-between vendors and customers. 

This relationship between employees, customers, channel partners, and vendors needs to flourish. With increasing competition, it is essential to differentiate your program from competitors’. Merely focussing on sales is not going to cut it from here on out.

Rewards and Recognition

Margins and commissions are not sufficient incentives for channel partners. 

1. Research shows that implementing non-cash reward and recognition programs for channel partners leads to an annual revenue increase averaging 9.6%, compared to an average of only 3.0%.
2. Research shows that implementing non-cash reward and recognition programs for channel partners leads to an annual revenue increase averaging 9.6%, compared to an average of only 3.0%.

This goes to show that channel partners respond to measurable rewards and recognition, much like other employees.

How does it work?

Reward programs must target employees proving to be instrumental in achieving organizational goals. 

It is essential to understand the behaviors to be encouraged to work towards rewards. 

1. Metrics need to be customized for channel partners 
2. Different metrics from distributors and other collaborators
3. In addition to margins and equity rebates
4. Non-cash rewards for meeting and exceeding goals 

Numerous studies have demonstrated the efficacy of performance vis-a-vis non-cash incentives. 

• According to the International Society of Performance Improvement, properly structured incentive programs can increase performance by up to 45% in teams and 26% in individuals. 
• The American Compensation Association further found that organizations earned $2.34 for every dollar they spent on incentive awards at the median.

Working towards the right incentives

Creating the right incentives requires the partner’s goals to be attainable, and the rewards need to be flexible. Offering referral bonuses for sales but having the actual sale go through directly or through a discount channel minimizes channel conflict and increases engagement. 

Channel incentive travel rewards are a great idea as well. This allows top channel partners to earn a group travel reward trip, creating an opportunity to form lasting relationships with company executives.

Creative rewards have a significant impact on relationships. A culture of partner engagement requires more to build and sustain strong emotional engagement. 

Rewards need to be 

1. Tangible 
2. In concert with regular verbal recognition
3. Regular acknowledgment of contributions

Information sharing and recognition are mission-critical. It merits taking the time to know and recognize the channel partners’ individual salespeople. An excellent way to go about this would be to have sales personnel from the company meet with a channel partner’s sales team. This can be done to share the previous month’s results and recognize achievements once a month.

Having an organized sales incentive program in place as part of your overall engagement strategy allows the company to understand who the best channel partner salespeople are. 

What can you incentivize?

Listed below are a few metrics that may seem obvious but aren’t usually considered for incentives or rewards. 

Customer loyalty

Having customers come back to you time and time again, despite cheaper deals elsewhere, is a sign of true loyalty. This is made possible only when channel partners are

• Highly-skilled
• Dedicated
• Proficient 

A great way to demonstrate appreciation for them going the extra mile would be to incentivize loyalty. For example, a reward for a certain amount of repeat business as part of your Incentive Program structure. 

Training

It is essential to understand that a channel partner can sell high volumes of a product only if they really understand its nuances and how it can benefit the customer. 

1. Achieving functional understanding and knowledge is a priority
2. Training is required on what the company does 
3. Training to understand how best to sell your products 

An excellent way to start the reward scheme would be to reward channel partners that undergo a certain amount of training, such as product demos, before incentivizing sales. 

Brand Exposure 

Incentivising brand exposure, channel partners can create demand for products among their customer base. This can be done through: 

1. Engaging them in email marketing campaigns 
2. Having them organize regular events that prominently feature your brand 

While not directly linked to sales figures, this works wonders for driving channel partner engagement.

Gathering Customer Information

With data driving digitization and transformation, the more information available about customers, the better the product can meet their demands. However, if there are plenty of channel partners, getting pertinent information can prove to be tough. 

• Incentivising channel partners for collecting necessary information
• Passing on the collected information to you
• Maintaining legal and regulatory compliance throughout the process 

While not directly linked to sales, the more data available, the easier it is to sell to customers. This significantly impacts the company’s bottom line. 

The final word

Having a substantial reward and recognition program helps the company grow while enhancing employee satisfaction and boosting morale. Zaggle Propel is an easy to use platform that builds and strengthens engagement for employees, consumers, and channel partners.

With point-based rewards, easy points redemption, and a real-time dashboard Zaggle Propel simplifies the employee and channel partner incentive playbook. With an extensive catalog for redemption, Zaggle Propel provides over 100 different gift card brands across various categories, with new brands added to the roster every month. 

Please reach out to us in case of any queries.