The Value of Partnerships in a SaaS World

Having run channels & alliances at multiple companies over the past 20 years, I’ve come to realize that partnerships in the SaaS world have undergone a transformative and almost unrecognizable metamorphosis.

Let’s start with the most fundamental question: what’s the purpose of partnerships in a SaaS world?

If you ask five people this question, you’ll probably get five different answers. But at the core of it, the only answer is customer value. Partnerships in a SaaS world have their greatest and most sustaining value when they deliver ROI to the partners’ joint customers.

That may sound obvious, but it’s much easier said than done. For instance, how many companies do you know where the primary purpose of partners is to refer business to them? While it’s great to have partners refer business, it’s relatively rare (my estimate is that it happens in roughly 15% of all partner interactions). Partner referrals should be viewed as a fortunate by-product of healthy partnerships rather than the sole reason they exist.

Do you know any companies where the partner program itself is viewed as an important source of revenue? I am seeing this increase within the martech ecosystem, and it’s a disturbing trend. When the cost of participation in the program is prohibitively high, the ultimate losers are end customers who are denied the expertise of innovative ISVs and service providers.

While such misperceptions about the purpose of partnerships are rampant, they’re not that surprising. The fact is, the SaaS world is different from anything we’ve seen over the past 20+ years. Not long ago, VAR networks and distribution channels provided a combination of solution development and market reach, without which the OEM (or ISV) could not scale. But in a SaaS world – where innovation is rapid, solution integration is available immediately through common protocols, and prospects can be reached in virtual yet personalized environments – software vendors don’t need partners for these purposes.

So, in this (relatively new) SaaS world, what does it look like when partnerships are designed with the primary purpose of making joint customers successful? As a martech SaaS company who serves CMOs, I’ll give you a couple examples:

Partnerships that feature interoperability between software solutions are critical. That new piece of software is just one part of the typical CMO’s 20+ marketing tech stack. Each plays a role in figuring out who to target, what message to deliver, which channel to deliver it through, and how to measure the performance, which means they all need to talk to one another.

Partnerships with deep expertise enable the CMO to create their vision through technology without having to have someone in-house. The people side of the equation is a risk that the CMO needs to mitigate when making buying decisions and partnerships can help fill that gap.

Partner programs that put customer success at the center have a focus on partner development. This means treating the partner as an extension of the family by providing training opportunities and communicating early about new developments. And while they measure and celebrate referrals, they recognize that this direct impact on the top line is actually a by-product of the more fundamental mission of making customers successful.

If you’re a CMO or marketing pro who’s involved in determining what solutions to buy, make sure you look beyond the features and functions and look at the ecosystem of partners who surround the platform. If you’re like most marketing organizations, you will need to stitch together multiple technology solutions and seek help from outside experts. To a very real degree, when you make a commitment to a platform, you’re also committing to the ecosystem that surrounds it – so make sure it’s designed with the central purpose of making you successful.

Check out how the Demandbase ABM Ecosystem can provide value to you and your team.