February 01, 2022

10 Partner Program KPIs You Need in 2022

How will you measure partner engagement in 2022? What are the signs of a successful partnership? This article explains the 10 most important partnership KPIs you'll need this year.

10-partner-program-kpis

No partner program is perfect from the get-go. You need to systematically track performance to improve its effectiveness. It’s not possible to just launch a program with a hands-off approach— success doesn’t happen on its own. Whether you are scaling up an existing program or , tracking and measuring the right Key Performance Indicators (KPIs) will help you build and grow an effective, profitable partner program. 

Why measure? You might ask. For starters, it will help you steer your resources to the most profitable sales channels. It also allows you to identify areas that need improvement, which helps you plan your activities and finances accordingly. What’s more, it is the only way to align your partners and internal teams for optimal performance and results. 

The Challenge of Generating Partner Program KPIs You Need

Unfortunately, many companies are unaware of the fundamental KPIs to track, while others don’t have the tools to do it automatically. Even worse, some others measure only revenue and ignore other vital metrics, which affects the health and quality of partnerships.

Ultimately, data-driven decisions are always the best ones. If you don’t keep partnership metrics, you could be investing your time and energy in the wrong places.

Are you looking to optimize your program? Here are the top 10 partner program KPIs you should track and measure in 2022.

Partner Program KPI #1: Number of Partners

This one is a no-brainer. The number of partners–existing and new–is the first and most obvious sign that your program is growing. It also helps establish your program in the business landscape, especially during the initial stages.  

Moreover, it testifies to the effectiveness of your recruiting strategies and indicates whether the program has the right ingredients that appeal to and attract partners. The number of new partners joining the program is also proof that your promotional efforts are reaching the prospects and addressing their priorities. It might say a thing or two about how attractive your initial offering is. 

According to the State of the Partner Ecosystem 2021 report, partner numbers are a highly relevant KPI for SMEs in the early stages of growth and channel maturity. If you belong to this category, there are many ways you can increase the number of partners–identifying your ideal partner persona, offering attractive deals, and developing a scalable partner ecosystem.

Partner Program KPI #2: Partner Types

Another major partner program KPI you should track and measure is the type of partners. You must categorize and track partnerships based on the status, nature of association, and location, for each reveals pivotal insights about your program. 

  • Partner Status: Make sure to keep track of partners by the current status. For instance, how many active partners do you have? How many are being recruited and onboarded? What’s the number of new prospects you have identified? These numbers will tell how successful your recruitment and activation strategies are.

  • Nature of Association: Similarly, you must categorize partners based on the nature of association – Value-Added Resellers (VARs), co-sellers, technology partners, , referrals, service partners, independent software vendors, and the like. It will help you assess where in your strategy each partner type fits so that you can focus on those who drive the most value. 

  • Partners by Location: Tracking partners by location is also essential while measuring the effectiveness of the program. It enables you to evaluate your global footprint and helps assess how effective your partner strategy for each region is. 

Partner Program KPI #3: Total Revenue Generated by Partners

Revenue, perhaps, is one of the most fundamental channel partner performance metrics to track in any partner program. After all, increasing revenue has been one of your key objectives, right? Measuring it, however, is more challenging than you think–you must take into account two types of revenues:

  • Partner-sourced Revenue is the direct revenue generated by a deal sourced by a partner. That is, the partner brings in a new lead (ecosystem-qualified lead) into your sales pipeline–there would be no deal if not for the partner. 

  • Partner-influenced Revenue refers to the indirect revenue partners generated by helping you make or close a deal. In other words, they initiate or accelerate it, but your sales team closes the deal. 

Measuring these types of revenue metrics is easier said than done, though. Often, there are challenges related to deal ownership and attribution. Two or more partners may register the same deal on the same day, or there could be channel conflicts between partners and your sales team about who gets the credit for a closed deal.

You must pay extra care while tracking revenue since it is one of the top indicators of successful partnership programs. Here is where PRM tools and software such as Kiflo come to your aid. Such tools help you register deals and track revenue with the highest levels of accuracy.

Partner Program KPI #4: Total Commission Given to Partners

Partner commission is a KPI that helps evaluate whether the program is profitable to both parties involved. Sometimes commissions can make up quite a significant chunk of expenses. However, it tends to be more cost-effective than many sales or marketing efforts because it generates real, qualified leads. Partners also bring in customers that tend to stay longer because they have another personal connection to your company.

The total commission distributed to partners gives you a better understanding of partner profitability–that is, whether the margins are good enough to keep them active and interested in the program. The better the commission, the happier the partners and the lower the attrition rates will be. 

Partner Program KPI #5: ROI of Partner Program

This is another no-brainer, but surprisingly many companies don’t know the ROI of their program mostly due to their difficulty to track leads and commission. The Return on Investment compares the financial returns of the program against the costs of running it. While calculating the total cost, one must factor in commission, marketing fees, advertising campaigns, and other related expenses.

ROI helps companies determine the effectiveness of their marketing efforts and campaigns. It is also a clear indicator of whether you are ready to scale–when your partner program reaches positive ROI, you know it’s time to take the next step. Furthermore, it throws light on whether a partner is profitable as an affiliate, referral, or reseller.

Tracking ROI is a challenging and complex task because of all the data that is required to calculate it. However, tracking the ROI is the only way to align internally on where to invest more efforts to grow in the most efficient way possible.

Partner Program KPI #6: Leads Created

According to the latest reports, "leads generated by partners" tops the list of the most common KPIs in 2022. Leads can come from several sources in a partner program, including referrals, channel partners, tech partners, and others. Though many of these leads don’t turn into opportunities or revenue, they still are crucial opportunity metrics that reveal a lot about the effectiveness of your partner program. 

For instance, if your partners are not bringing new leads, it could indicate that the partnership is not working. Or, it could give you some insights into the sales process of your partners. By tracking leads, you can identify partners who generate and convert the maximum number of quality leads, helping you narrow down the partnerships in which you should be investing.  

Partner Program KPI #7: Deals Generated and Distributed

The number of deals generated by partners and distributed to partners is a strong indicator of successful partnerships. Keeping a close track of these metrics is one of the best ways to gain financial visibility, analyze your partner’s pipeline, predict sales, and forecast revenue. It will also help you better align the efforts of your partners, marketing team, and sales team.

Remember, it is not enough to measure the deals registered by partners. You must also track average deal size and average closing time along with deal volume. Conversion rates are also critical – you can measure the total number of registered deals against closed deals to determine the conversion rate. Poor conversion rates might point toward the gaps in the customer journey, which you must rectify to improve sales.

Being able to view the number of deals generated gives you insights into your sales processes, points to improve, and the overall success of your program.

Partner Program KPI #8: Pipeline Summary

A pipeline summary, or the number of deals and their value at each stage of the sales process, is a critical partner program KPI you must track to predict future revenue. It gives you insights into two things: at what stage of the sales process your prospects are in and how many of them are likely to close deals. With these insights, your sales team can forecast revenue with the highest possible accuracy. 

It can also give you actionable data on how prospects behave at each stage of the pipeline. How many of them skip one or more stages? What is the average they spend at each? How many opportunities do you need at each stage to hit your target? Such details inform the decision you must take at each stage to increase the close rates.

Partner Program KPI #9: Partner Performance

Measuring partner performance is integral to optimizing your partner program. You must identify the top performers so that you know who to invest in to drive more value to you and your clients. By identifying the high-value partners, you can also strategize to enhance the joint value proposition. 

You must also measure the performance of individual partners against the revenue, leads, and deals each generates. Similarly, partner engagement is another vital area you need to measure periodically– partner logins, activities and attendance, and marketing activities are all pivotal here.  

Here’s an example from Kiflo, for instance, of stats you can get on each partner:

Partner Deal Statistics Example
Example of a partner's deal statistics tracked in Kiflo.
Partner Lead Statistics Example
Example of a partner's lead statistics tracked in Kiflo.

Partner Program KPI #10: Performance of Resources

Performance of resources is an essential metric most companies tend to ignore. When partners join the program, you provide them with a set of resources to prepare them to engage with customers. Measuring the usefulness of these resources is integral to ensuring partner program success.

For instance, technical training is a resource every company typically offers their partners for sales enablement. Some other vital resources include:

  • Training resources

  • Sales scripts, docs, and presentations

  • Marketing assets

  • Partner portals with updated news

All your partners must be able to rate these resources so that you can see which ones contribute to the value and worth of the program and which ones need improvement. Tracking the effectiveness of resources is also one of the best ways to keep them updated based on the changing nature of the program and the target market. 

Conclusion 

They say you cannot improve what you don’t measure, and we agree. Measuring KPIs is the fail-proof way to grow and optimize your partner program. You will need a combination of KPIs based on the size and maturity of the program. For instance, the number of new partners is a vital KPI in the initial days. However, as your program grows, revenue, leads, deals, active pipeline value, etc., become equally or more important. 

Remember, investing in the right partner management platform is the key to successfully measuring your partner program metrics.


Frequently Asked Questions (FAQ)

1. What are partner performance metrics?

Partner performance metrics are a set of measurable data you can use to track and assess the effectiveness of your partner program. They give you actionable insights into your revenue, sales, marketing, partner engagement, profitability, and more.

2. How do you measure partner engagement?

You can measure partner engagement through metrics like portal logins, communication, event participation, deal registration, conversion rates, and marketing and promotional activities. These metrics indicate how active partners are in the program.

3. What are the benefits of channel partner performance metrics?

Partner performance metrics help you assess whether the program is going in the right direction and identify the areas that need more attention. They also offer insights into the effectiveness of your recruitment strategy, sales and promotions, training, processes, and tools.

4. What are the main indicators of a successful partnership?

Increased revenue, profitability, ROI, leads, and conversion rates are the top indicators that your partnership is a financial success. Other indicators include partner satisfaction, the value you bring into the market, and partner engagement.

5. How do you generate Partner Program KPIs?

One of the best ways to get partner program KPIs is through platforms like Kiflo. You can monitor, measure, and assess various performance indicators that determine the success of your partnerships using such platforms.

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