Am I Getting ROI On My MDF Investments?

Many channel programs offer Marketing Development Funds (MDF) but not all of these programs are created equal. Some channel leaders are getting more bang for their MDF bucks by knowing just how those MDF dollars are performing. Here are the 3 critical components needed to determine which MDF activities pack a financial punch and which ones fall flat:

  1. Automate and manage with MDF technology. The foundation of a successful MDF program is technology. It is critical to deploy something to manage the MDF process start to finish. Partners need a centralized place to manage their MDF activities and you need the ability to track and report on your partner spend. Your MDF technology should include the ability for partners to request, update, claim, upload, and manage their MDF activities. This system should also integrate with your CRM system for lead management and tracking. A well deployed MDF technology will provide you with the tools needed to manage your MDF program and start you down the path towards tracking ROI.

  2. Get the lead data from your partners. Before we can get to MDF ROI we need to understand the results of the MDF spend. With a MDF process and system in place you can start tracking what your MDF spend is generating. It is crucial to require partners to provide you with the details of their MDF activities as part of your proof of performance (POP). Activity details could include a list of attendees, the leads generated from a banner ad, names from a tradeshow or a list an email blast was sent to. This information should be added to your CRM system and related back to your partners via your partner relationship management solution (PRM). This process is commonly referred to as lead distribution.

  3. Setup campaigns to analyze the data. Now that you have the MDF lead details, you need to track your MDF leads just as you would track traditional marketing leads: via a campaign. MDF generated leads should be added to a campaign within your CRM system. Campaigns need to be setup with ROI in mind so start thinking about how you want to measure ROI. This could be based on individual partner activity, by activity type or something else relevant to your business. The campaign should include the activity spend and the leads generated so the leads can be tracked as they move through your sales process. Keep in mind that the way you set up the campaign will determine how you will be able to measure your ROI. As your partners work their leads through the sales process, the campaigns will populate with the detail needed to understand which activities are performing.

When implemented as described, an MDF program will provide the data needed to understand which activities and partners are performing and which ones are not. Within a matter of months, you will start to understand what activities make the most sense to spend your money on. You will also be able to tell which partners you should spend your money with. When it comes to MDF, always remember that the focus should be on your partner’s business success and that will get you the ROI you are looking for.

This post by Raegan Wilson, Chief Channel Officer, Channel Squared Consulting, was recently published in our new eBook, The Top 10 Things Making Channel Chiefs into Insomniacs, and What to do About It. In creating this guide for Channel Chiefs, we tapped our network of top channel strategists to provide thoughtful, meaty, practical advice on Chiefs' key questions about the market today. Click here to down full eBook for recommendations that will help you transform your channel operations, accelerate your indirect sales — and sleep peacefully.

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