March 09, 2021

Partner Program Tiers: The Set Up Process A-Z

No two partners are alike. Every partner is motivated by something different. Because of this, catering to the needs of each partner while scaling your program can be difficult. The solution – Partner Program Tiers.

partner-program-tiers

Understanding the Need for Partner Program Tiers 

Partner program tiers can be described as levels within a partner program. Each level has different requirements, benefits, and rewards. These levels take into consideration the varying skill sets, activities, and factors motivating your partners to help meet their needs. For example, the rewards associated with customer referrals on one level would be quite different from the rewards associated with another level where partners sell the product actively.

Partner tiers make it easier to give each partner a program that suits them and keeps them motivated. It also allows you to scale the program easily and grow your partner network. Today, 52% of all partner programs use partner tiers.

How to Set Up Partner Program Tiers

There is no set rule as to how program tiers can be set up. The ideal solution for your partner program depends on your goals. You can have as many levels as you like, but companies normally use 3 levels. Each level will have different prerequisites from your partner and different rewards and benefits being offered. To develop these tiers, ask yourself questions like:

  • What qualifies a partner to stand at this level?

  • How much training is required?

  • What are the resources needed?

  • What are the benefits and rewards offered?

That said, let’s take a look at a common structure. Think of this as a pyramid structure with the first level at the bottom.

First level: You will probably have the highest number of partners in this tier. Partners in this tier do not necessarily need to be well-placed or have a very strong network. They are required to offer basic support in terms of referring your product to potential customers. These may be existing customers or industry influencers. These partners do not actively sell your product.

Second level: Second-level partners are strategic partners who are well-connected to your target audience and add value to your business. They make recommendations and introduce potential customers to your product but may not be able to close the deal. Agencies, consultants, and other non-competitive tech company partners may be placed at this level. These partners provide more support and hence require more investment and bigger rewards.

Third level: Third-level partners are at the top of the pyramid. These partners invest a lot of their time and effort in actively selling your product and converting leads. At this level, you will need to provide quite a bit of training to your partners. Third-level partners also need higher, personal incentives to keep them motivated. Partners such as VARs, integrators, and MSPs could stand at this level. 

Here is an example of how you can set up the requirements, benefits, and rewards of your partner tiers:

partner tiers requirements board
partner-program-tiers-requirements-board
Partner program reward board
partner-tier-program-reward-board

Easing Potential Challenges 

When creating partner program tiers, you must ensure that the tiers do not complicate partner management. Since every partner can have different goals, may need varying amounts of resources and training, and can be offered different rewards, you must make sure they are well-fitted to the tier. 

This is where Partner Relationship Management (PRM) tools can help. A PRM facilitates the onboarding process and helps track each partner’s progress. It also makes it easier for you to give your partners the support they need. It provides valuable insights such as partner attribution rates and partner KPIs to aid in strategic decisions for the future of your partner program.

To start with, you need to specify the requirements, goals, resources, training needs, commission, rewards, etc. for each tier. Onboard all your partners and place them in the appropriate tier. A good PRM will also let some or all of your partners access the system through a partner portal so that they are informed of the needs and objectives of their tier.  For example, leads provided by tier 1 partners may be tracked through personal referral links while those provided by tier 2 partners could be tracked through submissions on the partner portal. 

Examples of Successful Partner Program Tiers 

More than half the companies that run a partner program use a tiered system. Let’s look at a few examples:

Zendesk’s Partner Tiers

Zendesk has a three-tier program similar to the structure described above. Partners in tier 1 must fulfill very basic requirements and need not have exceptional technical expertise. However, the requirements grow for tier 2 and tier 3. The rewards and benefits also increase proportionately. 

One of the key benefits offered is lead distribution. Through this, the company shares leads with partners who have the highest probability of closing a deal. For example, a partner may already have an established relationship with the lead. A PRM makes it easy to do this and allows partners to access leads through the partner portal. 

Zendesk Partner Program

Pipedrive’s Partner Tiers

Pipedrive has a similar 3-tiered structure. While the top level is reserved for consultants, VARs, and integrators, the first level is open to anyone wanting to recommend Pipedrive.

Pipedrive Partner Program
Pipedrive breaks down the rewards and benefits for their partner tiers.

Aircall's Partner Tiers

Aircall’s partner tiers focus on the role played by their partners instead of their overall sales potential. In their case, partners in the first tier only provide leads and those in the second tier manage the sales cycle and help the business grow. Third-tier partners complete the sales cycle and provide after-sales support. Thus, the tiers are linked to the partner’s capabilities. As a partner’s capabilities and expertise grow, they may move from one tier to the next.

Aircall Partner Program
Aircall explains the types of partners in their program and their benefits.

Hubspot’s Partner Tiers

Hubspot has a 5-tier program based on how much each partner sells. With a PRM, managing such a structure can be automated and when a partner crosses the revenue threshold, they can be automatically moved to the next level.

Hubspot partner program

Finding a PRM suited to your program

Irrespective of how you design your tiers and how many levels you create, a PRM is essential. The Kiflo PRM simplifies the tier management of partners. It is designed specifically with tech startups and SMB structures in mind. From partner onboarding and attribution to tier management, Kiflo simplifies it all.

Align and amplify your partner ecosystem, all in one place.

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Frequently Asked Questions (FAQ)

What are partner program tiers?

Partner program tiers are ways of segmenting partners in your program based on activity, operations, strengths, and goals.

Are partner program tiers important?

Yes! Partner program tiers serve many purposes for both vendors and partners. They help motivate partners, create transparency on requirements and rewards, and let channel managers know how to delegate partner resources.

How are partner program tiers organized?

The most common way to organize partner programs is through a three-tiered system. For example, bronze, silver, and gold partners.

Are their different ways to set up partner program tiers?

Yes, partner program tiers should be built to mirror the companies goals, making them very subjective to the needs and operations of the company itself.

Can PRM software help build partner program tiers?

A good PRM software will help you build, manage, and scale your partner program tiers. For example, Kiflo PRM allows you to build completely customized programs with different requirements, rewards, and benefits for each tier, as well as track data on those tiers.

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