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Building an Effective Channel Incentives Program

Rachel Reed
8/28/19 5:26 PM

As of 2016, 84% of U.S. businesses utilize non-cash incentives and rewards as a method of retaining and engaging their employees, salespeople, channel/dealer partners, and clients. Top performing manufacturing organizations are more likely to see channel incentive programs as a critical tool in managing the company’s performance.

In fact, executives at top performing manufacturing firms were more than twice as likely as those at average performing manufacturing firms to regard their reward and recognition programs as a competitive advantage.

In order to build an effective channel incentives program: 

  1. Identify your objectives
    Research by the Incentive Research Foundation (IRF) found that top performing manufacturing organizations cite the following objectives in running channel loyalty programs:

    Product & brand awareness
    Customer loyalty
    Partner loyalty
    Sales & market share

  2. Identify your key players
    Which distributors, partners, and customers have the most influence over your B2B sales? Identify your B2B market collective and offer incentives that benefit each channel to boost sales and promote brand loyalty. 

  3. Add channel-wide value
    Show your channel partners what’s in it for them, and they’re more likely to support an incentives program. A channel incentive program will influence end customer purchase decisions. But when distributors are also incentivized (think rebates), your program will be prioritized over the competition.

  4. Influence & engage
    Leverage a channel program to influence and engage distributors. Harness the power of influence with a channel incentives program which allows you to not only market and promote products to your channel partners, but identify power customer purchase behavior. Having distributors on board and incentivized makes engaging with the end customer organic. Opening up the line of communication creates new opportunity to market and promote product awareness. 

  5. Educate your reps and sales channel partners
    Leverage your incentives program to educate and motivate sales reps. Create campaigns around high margin products and reward sales channel members. 


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