Monday, August 24, 2015

ANNOUNCING the gender of Schmoo 2!

Will it be girl #4 or boy #1? Find out here...

A picture from August 24, 2015 of Schmoo 2 before we knew the gender:

Here is when we made the announcement a few months ago:

Thursday, August 13, 2015

The biggest thing to happen to Channel Sales in 30 years

I have a conundrum.

According to the World Trade Organization (, about 75% of all global trade flows through indirect channels.

In fact, there is an estimated 30 million reselling (non-producing) businesses world-wide across all industries. More than 50% of the 20 million businesses in North America are primarily resellers, dealers, brokers or distributors of goods and services. The computer industry alone has over 1 million companies reselling and providing services for end users worldwide.

Sound impressive? When you start looking at sales tools, enablement, education and just plain focus, it is almost exclusively direct selling.

Here are 2 (non-scientific) observations I made recently:

1. has 438,619 books on direct sales and only 180 on indirect sales.

2. Salesforce Dreamforce, the largest software tradeshow on the planet had hundreds of vendors exhibiting and only a handful are channel related (ChannelEyes being one of them).

Hence, my conundrum.

We know that channel organizations are often the red-headed stepchild of organizations. Many times they are slotted inside the sales or marketing organizations and not funded and resourced effectively. Even though the majority of revenue flows through this route to market, their ability to drive management decision making, get access to internal resources, or place bets is restricted.

One thing we do know is that most CEO's do not come from channel backgrounds. A Business Insider report looked at the S&P 500 and found that 33% of CEO's graduated with engineering, a similar number grew through direct sales organizations, 15% come from finance, and 11% come from business administration/operations. Not sure you could find even one Channel Chief on this list. (8/17 Update: Thank to my friend Larry Kesslin for pointing out that Chuck Robbins, the new CEO of Cisco was a Channel guy for almost 10 years!)

I have written before that channels tend to be nebulous – not only hard to measure because of their indirect nature, but time-delayed as collecting data is through a complicated multi-tier supply chain. Sales in, sales out, end user reporting, return on invested capital, these are metrics that confuse even the best CEO.

With that being said, let's get to the point.

Channel organizations, specifically the front-line sellers, do not have access to high quality tools to drive higher degrees of success. The direct sales world is cluttered with great software that predicts the right activities, builds an automated workflow, and even intuitively dials for you based on millions of different data points.

The channel ecosystem has some antiquated PRM tools that focus on back-end plumbing, front-end portals that have become so large and cumbersome that 95% of partners don't take the time to log in to anymore, and some gimmicky point solutions that promise better communication, engagement, enablement (and a bunch of other Dilbert words).

But channel sellers are still stuck in the last decade. A Channel Account Manager (or CAM for short) can have over 100 partners they manage in their territory. Their only tools include a poorly formatted spreadsheet, a CRM system that has been jerry-rigged to include some partner related stuff, email and a phone. The lucky ones get to play golf now and then, but that is becoming increasingly rare.

Channel Executives know that managing with their gut and repeating the same tactics year to year doesn't move the needle, however their hands are tied.

Until now.

ChannelEyes is working on the first ever CAM workflow product that is based on advanced data science, business intelligence  and channel analytics. The product is called Optyx and it is in private beta right now.

Replacing the spreadsheet, and sitting on top of the CRM system, this software-as-a-service product changes the game significantly. By combining different data sources, including transactional, point of sale, behavioral and external Big Data, this platform has the ability to predict, notify and prescribe the next best action with partners.

The average CAM is only managing 10-20% of their territory effectively. In fact, over 50% of their Executives fear that they are not calling the right partners with the right messaging at the right time.

Optyx changes that equation. It can watch EVERY partner with built-in algorithms that trigger alerts and notifications. I am sure a CAM would like to know if one of their key partners D&B credit rating dropped or another partner is on a hiring spree with a new successful practice just launched. What if a competitor just gave an award to one of your partners? Good information to know.

There are hundreds of data sources on the public web, however the most powerful information doesn't tend to be free. Even researching one partner could take a full day sitting behind a Google Search bar.

It isn't about data though. It is about action. Specifically, a CAM's next best action.

Optyx is a workflow tool that takes these alerts and notifications and translates them into actionable and measurable activities. Calling, emailing, social selling and even on-site visits can be prioritized based on predicted outcome and then noted and tracked in the CRM system, whether it be or other.

Another powerful feature is the Partner Dashboard. Having transactional, behavioral and external Big Data all in one spot will make for informed conversations with partners and significantly cut down on the time and energy in tracking what a partner is doing and how they are performing.

CAM's report that 20% of their time is building reports for management and collecting information for partner Quarterly Business Reviews. This is now automated and that one day a week can go back to selling.

You will see Optyx go live in the next few months - if you are interested in getting a sneak peek today or joining the private beta, send me a note.

I believe it is the biggest thing to happen to Channel sales in 30 years.

Monday, August 10, 2015

Direct selling vs. Indirect

Fun fact of the day: 75% of the World's GDP is sold indirectly through Channels and Partners.

Amazon has 438,619 books on direct sales and only 180 on driving indirect sales.


Friday, August 7, 2015

Everything I know about the Partner Channel I learned from Paul Revere

There is a very important chapter in Malcolm Gladwell's Tipping Point that applies to the channel.

In the "Law of the Few", he explains that a very select group of people are responsible for the "tipping" of almost all social epidemics. These three unique groups of people are special for their incredible abilities to communicate, teach, and persuade.

Gladwell illustrates the story with Paul Revere and the Midnight Ride. Revere was possibly the best connected person in Boston on April 18, 1775. When he was alerted to the impending British attack on the armory at Concord, he successfully alerted and armed much of the Boston countryside.

Most American youngsters are not taught that two other riders took off that night - William Dawes and Samuel Prescott. Revere was far more effective in delivering his message. In any given town, Revere would know the right doors to knock on, the right people to talk to, and the right message to convey. Dawes and Prescott, on the other hand, had very little knowledge of these towns, and were not particularly effective communicators, making their warnings largely ignored.

Paul Revere's vast web of acquaintances allowed him to spread the word that the British would soon attack, but he also relied on his knowledge of the current situation, a trait not typically associated with connectors. These two traits made Paul Revere an extraordinary man: he had the communication skills of a connector, and the knowledge of a maven.

Now, back to the channel and my personal story.

I moved to the U.S. in April of 2009 with very little knowledge of the U.S. IT landscape. For 15 years, I was working for IBM and Lenovo and focused exclusively on the Canadian market. I spent my first couple of months playing the role of a maven.

I collected all 16 channel magazines at the time, dozens of tradeshows, associations, peer groups, bloggers and activity on social media and created a master spreadsheet. Every time I came across a keynote speaker, top industry list, writer, board member, trainer, community leader, or vendor/distributor executive, I would write their name, company and title down along with one check-mark. If I came across them again, another check-mark was given.

After a couple of months, the spreadsheet had grown to 895 names with thousands of check-marks. I figured that I was 80% complete in understanding the who's-who of the North American channel. When I sorted the list by number of check-marks, there was an interesting cut-off at about 100 names.

My hypothesis was that connectors and influencers would be omnipresent in the industry - showing up at different shows, articles, press releases, top industry lists, communities, radio shows, and so on. And I was right.

Could it be that an industry with over 160,000 channel partners, tens of thousands of vendors and millions of people working that it all boils down to 100 super-connectors?


By the summer of 2009 I was officially a road warrior. I traveled to 40 different shows and lived out of a suitcase for weeks on end. I would do my best to target top 100 players at each show and work to make their acquaintance. Because they are connectors and social networking is their specialty, this was easier than I had thought. I spent countless hours at the hotel lobby bar listening to these individuals talk about themselves and decades spent getting to where they are.

The fact that I don't drink came in handy as I tried to memorize everything and would race up to my room and further update the spreadsheet. Connectors NEED to be in the know and spend a lot of time keeping track of the other top 100 connectors. This made my job easier.

It also allowed me to knock names off the list. If you work for a big company with tons of resources, getting keynote slots, guest blogs and industry activity can definitely be bought. Hanging around this crowd made it easy to know who "earned" their stripes and who purchased them.

One thing that surprised me was the inability to tell a connector by job title. I originally thought that they would all be successful Senior VPs or CEOs - but that was wrong. A few of them make money as peer or community leaders but that was the exception not the rule. One is a farmer from the Midwest. Some were even unemployed!

Two important things happened after meeting many of the Top 100 connectors:

1. Endorsements 

Connectors are some of the most trusted voices in the industry. Many of them have loyal followings of over 1,000 people who look to them for advice and guidance. A few of the key endorsements that Lenovo gained added tens of millions of dollars to the bottom line - and continue today.

I counted 30 endorsements in the first 12 months. Some happened on stage at shows, some in magazines and blogs, and even some on podcasts. We tracked every partner sign-up and could see the rapid word-of-mouth growth of our program and revenue.

2. Personal Celebrity

An interesting side effect of engaging (and adding value) to connectors is that other connectors take notice quickly.  Remember, connectors need to know what is going on! I didn't need to seek out all 100 people - after the first dozen or so, many of them started seeking me out at shows and over the phone.

I was strictly a maven - trying to understand how the industry worked and making up for the time I didn't spend working in the country. I learned that by associating with the connectors, I was inadvertently earning that title for myself as well.

The recognition for that started shortly after:

- Named Top 40 Under Forty by the Business Review
- Named #19 Newsmaker of the Year - ITBusiness & CDN Magazine
- Named Top 20 Global Channel Thought Leaders by ChannelPro Magazine & EH Publishing
- Named Top 50 Global Channel Influencers by The VAR Guy & Penton Media
- Named Top 100 Global Technology Thought Leaders by Vertical Systems Reseller Magazine
- Named Top 150 SMB Influencers in the world by SMB Nation and SMB Technology Network
- Named Top 250 Managed Services Executive in the world by MSPMentor
- Never Stop Marketing Award by SmartBrief
- Winner of ASCII Cup as top vendor, voted on by Channel community

While it is nice to be patted on the back - I didn't (and still don't) deserve the recognition. Getting on these lists had a positive effect of drawing others to me which created a self-propelled cycle.

As an interesting side-note, a good maven will look to validate their theories. Perhaps the IT industry was somehow different than everything else and this was not repeatable?

I tested the theory again in Raleigh, N.C. I wrote down the names of politicians, police chiefs, media, charity leaders and looked at the local events, magazines and newspapers that reported on them. After only 18 months of living there, I was able to drill down to the 100 people that make that city go around. Again, with 1,214,516 people living there, it all came down to a magic connector list of 100.

I have told this story a number of times - to vendors looking to break into the channel or an individual that wants to make a difference quickly. It starts with a plan, followed by some long nights of research and then ends with digging in and making things happen.

When are you planning your midnight run?