Maturing Into A Horizontal Channel Management Platform Aligned With CRM and Marketing Automation

Channel and alliance leaders are known to be good jugglers. With the average partner program containing over 90 distinct components, encouraging channel growth while mediating conflict is a complex undertaking.

Partner relationship management (PRM) connects the dots between partner planning, recruitment, onboarding, enablement, incentives, co-selling, co-marketing, and management. Due to the growing number and types of partners, managing a channel program today has become less of a linear approach and more on-demand with automated workflows, personalization, customization, and scalability.

As brands increasingly use channels, partnerships, and alliances as a primary vehicle to reach customers, managing these relationships in a consistent, predictable, and productive way is critical. Strong partner programs that serve indirect routes-to-market will differentiate companies in the next decade, and channel pros need the right technologies to support and scale them, providing personalization, automation, and self-service at every interaction point.

Attempting to satisfy the permutations and combinations in the modern channel with spreadsheets and personnel has become a competitive disadvantage for many brands. PRM platforms continue to mature, with focus on business intelligence, automation, and template-based workflows.

As I have mentioned in the past, sales and marketing leaders have been transforming themselves into predictable, data-driven business units. The CRM stage started in the 1990s and accelerated quickly a decade later with integrated cloud offerings. The marketing automation stage began to grow exponentially around 2008 and has reached critical mass in its first decade. With 75% of world trade flowing indirectly, brands are starting to invest in their indirect channels, partnerships, and alliances at the same level.

The third stage in sales and marketing transformation will be anchored around effective partner relationship management and through-channel marketing automation (TCMA). Enabling partners of all types to leverage a single portal with access to enablement, onboarding, incentives, engagement, co-selling, and co-marketing is critical to driving a winning customer experience and improved partner experience.

Those brands that can balance their direct and indirect execution while ensuring consistent customer expectations and experience are having outsized success in the market. We are seeing that quick-start templates, personalization, and advanced analytics are key differentiators in the PRM market. As legacy technology becomes outdated and less effective, the ability to scale a partner program includes the use of more specialized templates, improved business logic and workflows, personalization at the company and individual level, and analytics that drive the next best action.

Here Is A Glimpse Of The Global PRM Market

  • Twenty-three vendors offer some level of PRM functionality, driving $350 million (USD) in pure software revenue per year. Another $500 million is estimated in related technology services, including installation, implementation, integration, security, compliance, and business continuity. This does not include through-channel-related concierge, integration, and consulting, which is reported on here.
  • Forrester predicts the PRM software market to grow to $679 million by 2023, a CAGR of 14.2 percent.
  • An additional $971 million will be generated by 2023 in downstream technology services in this ecosystem. The broader PRM services market includes hundreds of channel-specific consultants, thousands of sales and marketing firms, tens of thousands of marketing digital agencies, systems integrators (SIs), and a complimentary ISV ecosystem that is adjacent to these platforms.
  • The total PRM ecosystem, including software and services, is $850 million today and predicted to be $1.65 billion by 2023.
  • PRM is a horizontal solution serving indirect channels in all 27 industries. The top industries by revenue are technology/telco (34%), manufacturing (23%), insurance (9%), retail/franchising (6%), finance (6%), healthcare (6%), hospitality (4%), automotive (2%), and “other” (8%).
  • Over 12 million end users log into these systems, with the average deal size around $51,130 for these 23 vendors.
  • An estimated 1,633 employees are fully dedicated to PRM software development, with tens of thousands of others making money on services wrapped around it. According to LinkedIn, these vendors had 3.2% employee growth last year and 21.2% in the past two years.
  • This is a mature industry, with the average PRM solution launching 10 years ago and mostly US-based. Only five companies were founded outside the US.

Forrester is seeing numerous changes happen within channels across every industry and region of the world. From demographic shifts to new buyers emboldening new types of channels, the need to manage a growing and diverse set of partners and alliances is critical to a brand’s success.

The PRM market is growing because more executive teams, as well as channel, marketing, and sales professionals, are recognizing the impact of third-party influencers in getting to new buyers. They are placing trust in PRM providers to act as strategic partners, allowing them to broaden their reach and influence the partner journey in new ways.

In our recent 26-criteria evaluation of PRM providers, Forrester identified the 12 most significant ones — Allbound, Channeltivity, ChannelXperts, Impartner, Magentrix, Mindmatrix, Oracle, Salesforce, TIE Kinetix, Webinfinity, Zift Solutions, and ZINFI — and researched, analyzed, and scored them.

“The Forrester Wave™: Partner Relationship Management, Q4 2018” report shows how each provider measures up and helps B2B channel and marketing professionals make the right choice.