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A Guide to Developing Channel Partner Incentive Programs

Learn how to use incentive programs to drive sales and improve the quality of your partnerships with this guide.
Use this Guide to Develop Channel Partner Incentive Programs
Published on
October 25, 2022


Let's admit it, we all enjoy receiving appreciation for our efforts because positive reinforcement feels great. 

It's even better when it helps our skills, abilities, and businesses grow and develop.

A channel partner incentive program encourages long-term partner loyalty by rewarding them with incentives that help them grow their businesses and earn more money while also assisting your business in expanding.

This article will explore and guide you on how a partner incentive program can benefit you and your partners.

Benefits of Partner Incentive Programs

A successful channel partner program can help businesses scale quickly in new markets and deliver effective products and services with a big impact. So, why not reward your partners for assisting you in reaching that level of potential?

To do so, one must first understand why and how partner incentive programs are important, and how they can help with partner retention and activation

Increase Brand Awareness and Growth

Rewarding your partners with incentives increases program loyalty; additionally, partners can advertise your brand in their existing markets, resulting in brand growth and awareness.

Increase Sales and Market Share

Apart from encouraging long-term partner loyalty, it also helps boost sales and makes them prefer your product over competitors' brands, which is a step in the right direction because partners frequently rely on the extra support and revenue generated to grow their business.

Increase Innovation

Your organization's products and processes may benefit from working with partners who have different specialties and geographical locations.

This presents you with a fresh opportunity to discover more about the local market and what drives various kinds of businesses on the whole. This provides you with ideas on how to change and modify your product or even completely innovate a new product to meet market demands.

Building Your Channel Partner Incentives 

Yes, creating partner incentives is essential to the success of your program; however, take care not to overcomplicate it. The less work required of your partners to complete your incentive program and sell your product, the better.

Here are a few things to think about when building your partner incentives:

Work Within Your Capabilities

The idea of rewarding large and limitless incentives appears to be a good one, and one that appears to be simple to implement, until you have nothing left to give. 

So, before embarking on an incentive program or model, it is critical to consider your budget because you don't want to get started on something you won't be able to finish.

Diversify Your Incentives 

Using monetary incentives is a great idea because it shows your willingness to invest in the partner’s success, but you should also keep the program engaging to spur participation from your partners. And while monetary awards are a common incentive, don't let that discourage you from looking into other types of awards, such as:

Another factor to consider is the level of incentives; in other words, the more the partner participates, the greater the reward. Setting goals that allow your partners to achieve a certain status when they meet an objective and rewarding them with the appropriate incentive can help keep current partners motivated and bring you more clients.

Offer a Competitive Incentive

Your partners can drive significant results for your company, which is why it is more important to provide your partners with a generous incentive to push, refer, and sell your product, especially in a competitive market where it can be difficult to keep your partners satisfied, devoted, and—more crucially—engaged with your brand.

Whether you offer a cash award for each percentage of new business, a sales discount, or a flat rate award for each sale, make sure your incentive is competitive.

Review Your Incentives Regularly

Don't set up a commission or reward system unless you're prepared to review it frequently. 

You can use these reviews to determine which programs are working well and to check that the return on investment (ROI) is appropriate given the results the program is generating.

Keep in mind that you should:

  • Examine incentives in relation to your revenue rates.
  • Confirm that your incentives are delivered on time and at the appropriate intervals.

Incentive Programs by Type of Partner

Incentives that work with one partner may not work with another. As a result, it is critical that you investigate various types of incentives as well as the partners who best match them.

Affiliate Partner Incentives

Finding and working with quality affiliate partners takes time and effort because they can help you reach a wider audience and lend their reliable voices to your brand to bring you more customers and sales.

As a result, it is critical that affiliate incentives be of the highest caliber while remaining easy to track and reward.

Using affiliate incentives to intentionally reward your top-performing affiliates can help motivate them to continue driving sales. Increased motivation for affiliates to stay alert and actively promote your brand means more sales and revenue for you.

Types of Affiliate partner incentives:

  • Commission per frequency of clicks and/or posts
  • Rewards per leads and deals generated from the partner’s audience
  • Benefits for generating a certain amount of revenue 

Referral Partner Incentives 

Referrals are a new and improved way for businesses to grow because they are free and have a high success rate. They allow your partners to capitalize on their trusted relationships to bring prospects to your company.

Partners who actively promote and refer others to a brand are typically given a referral incentive. This is done through a formal referral program, which helps to engage current clients and promote word-of-mouth advertising.

Types of incentives:

  • Mutual referrals 
  • One-time commissions on referrals and/or deals closed
  • Recurring rewards per subscription plans

Reseller Partner Incentives

Reseller incentives can encourage partners to market and sell more of your goods, increasing sales and fostering business expansion while reducing the need for internal spending on marketing, sales leaders, and sales staff.

In the end, reseller partner incentives can assist you in building lasting solutions and formulating strategies that will help your company achieve high sales figures and, ultimately, bring tangible value to your end users.

Types of incentives:

  • Product discounts 
  • Rebates
  • Co-selling and co-marketing resources and support
Channel partner incentive programs guide table

Other Best Practices for Incentive Programs

Well-designed incentive programs can increase sales revenue, and if you're implementing a new channel partner program strategy and want to make sure you're setting it up for success, here are a few best practices to make sure your channel partner incentive program successfully motivates your partners.

Keep it Simple 

Most incentive program mistakes are caused by a desire to impress partners with time-consuming programs, complicated steps, and a variety of special offers. 

We are here to tell you that simplicity is key.

The foundation of a successful incentive program is to make it simple for your partners to see how they can earn incentives, claim their rewards, and even stay in touch so they can see how you're investing back into their business.

A complex program may obstruct how partners sell. They might not understand the materials they require, where to find them, or how to effectively sell the benefits of your goods or services to win over customers.

Winning programs give partners a simple set of behaviors to achieve and a clear path to earning set incentives. This allows them to focus on and continue selling your products. Furthermore, it enables you to account for your programs and clearly see where your budget is being invested to ensure that programs are working.

Don’t Just Focus on Revenue 

Yes, it is true that the primary goal of a partner incentive program is typically to increase sales, but thinking outside the box can be the special element that elevates your incentive program to a higher level.

Don't just focus on revenue; instead, focus on value

Consider investing some time in identifying key areas where your partners could use some help, even if it is not solely revenue-focused. 

Perhaps reward partners for participating in product demos or other educational activities, fund marketing campaigns, or even offer one-on-one time with particular experts in your company; the choice is entirely yours.

Be creative!

Collect Feedback

Giving your partners the best incentive programs is something you should always strive for, and feedback is an important part of that process.

Constant partner feedback from both parties is critical to success. If your partners feel included in the planning of incentive programs and understand how they will benefit them, they will be more likely to sell and promote your product.

Another thing to keep in mind is that feedback should be used to help you and your partners better understand each other's strengths and to provide the inspiration and direction needed to capitalize on those strengths.

Analyze, Adjust & Improve 

The most successful partner incentive programs are constantly monitored and analyzed in order to understand how the program drives business activity and which incentives lead to increased sales.

Consistently analyzing your program, identifying gaps where partners fall short, and updating underperforming policies and incentives are critical steps in developing a successful incentive program.

Once the data has been analyzed, it is critical to quickly model and implement changes to correct them so that partners are not inconvenienced.


Keeping track of your incentive program doesn't have to be difficult.

If there is one area in which we recommend investing to ensure that your partner incentive program gets off to the best possible start, it is your data management processes and tools.

The majority of incentive program failure is attributed to poor data-handling practices. Because what appears to be a great idea on paper can be difficult to execute in the channel. The right management tools can eliminate human errors and integration issues, freeing up your channel managers to work on optimizing the incentive program instead.

Ensure that your program is easily accessible via your reliable and automated partner portal, which can help you keep track of your partners' incentives and which programs best benefit them.

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