What’s Holding Local Partners Back From Marketing Maturity?

BrandMuscle | January 28, 2022

Brands must help their local partners reach higher levels of marketing maturity to drive incremental revenue

Each year we survey thousands of channel partners and numerous large national brands across a variety of industries to create our State of Local Marketing Report, the single most comprehensive study on local marketing trends and best practices. Within the report, The BrandMuscle® Local Marketing Maturity Matrix™ offers a proven framework for identifying the factors that have the greatest impact on channel marketing program performance and revenue growth, what’s holding partners back, and how brands came improve participation.

How Brands Benefit From Improving Channel Partner Marketing Maturity

There are many ways that brands benefit from improving their channel partners’ marketing maturity.

Since 2019, two of our State of Local Marketing Report findings have consistently correlated channel partners’ ability to achieve greater revenue growth to their investment in marketing and marketing maturity. This will not surprise marketing professionals, but for many local partners, investment in marketing may not be a priority. Helping partners understand the quantifiable ways marketing investments drive revenue will help them be more successful. Unfortunately, in 2021, our data shows that partner reinvestment in marketing was down year over year, with only 50% investing more than 1% of their annual revenue back into marketing. Partners who reinvested 1% or more in marketing realized 14% higher revenue growth that their peers. Despite all other program factors, investment in marketing consistently results in higher revenue growth. Unfortunately, there are numerous barriers that hold partners back from increasing their marketing acumen and maturity.

1. Poor Channel Marketing Programs

The top factors that hold partners back from becoming more marketing mature are mapped through The BrandMuscle® Local Marketing Maturity Matrix™. Our proven framework identifies the factors that have the greatest impact on channel marketing program performance and revenue growth. In 2021, Marketing Mature partners realized almost two times more revenue growth than their less mature peers. But what keeps others from reaching marketing maturity?

Our research shows that factors holding partners back from marketing maturity include:

  • Local partner spend
  • Corporate commitment
  • Digital needs / business listings
  • Program familiarity
  • Content relevance
  • Program variety
  • Partner commitment
  • Content quality
  • Digital needs / website
  • Program ease of use

And when partners commit to their corporate marketing program, everybody wins.

2. Difficulty Accessing Co-op and Marketing Funds

Our research identifies three reasons why co-op and marketing funds go unused: lack of program knowledge, complicated processes, and insufficient marketing support. Program perception is another big obstacle.

Half of the roughly $70 billion dollars allocated to fund co-op advertising programs every year go unused. That’s $35 billion that companies leave on the table, $35 billion that doesn’t lead to sales and shape the consumer journey. Busy partners leave funds on the table because they do not feel that program participation is worth their time. The amount of funds available, and the types of actions approved, all culminate in a perceived “worth” for the partner, and that worth must be valuable enough to move them to action.

The State of Local Marketing Report 2021-2022 shows that perception of program worth has declined, with only 46% viewing funding programs as definitely being worth their time. 31% of partners are not convinced that participation is worth their time. This could be because they view programs as hard to use. 23% indicated usage is hard or very hard, and another 26% indicated it was of average difficulty. Co-op marketing is not an easy task in and of itself, but brands frequently make utilization of funds more difficult than necessary with long approval processes for brand compliance and restricting use of certain tactics or vendors. Brands must simplify their programs to remove barriers to entry and participation.

3. Lack of Investment

The data clearly connects marketing maturity with increased revenue growth. It also shows that, while investment may help achieve slightly better results, the ways partners choose to invest their funds greatly impact revenue potential. It is investment coupled with actions that help move partners along the maturity spectrum to greater revenue growth.

For 50% of local partners, investment in marketing is one of the main factors holding them back from advancing in marketing maturity. While brands cannot force partners to invest in marketing, they can encourage appropriate investment by better leveraging their co-op and marketing fund programs. Reimbursement rates, especially on effective marketing activities, can influence spend. Higher reimbursement rates can entice partners to participate and, once they see the value, increase their investment. Adding incremental funding to support high-valued activities may increase partner trial and investment. Most importantly, demonstrating the value of any investment with ROI reporting or performance scorecards can help validate the advantages of marketing to partners. Only 18% of brands share ROI data with their partners and help them understand how to apply it to their business.

Through their channel marketing programs, brands have a significant impact on the next set of factors that are holding partners back. Ensuring partners understand program offerings and how to access the tools provided is critical to participation. Program familiarity is an issue for 27% of partners — meaning, they do not understand what is being offered to them through the channel marketing program or how to access it. Beyond that, enabling local partners to increase participation in local marketing efforts through investment in a variety of locally relevant program offerings will resonate with individual partner’s needs. Finally, proactively educating, training, and recommending marketing actions demonstrates a commitment to the channel marketing program and partners’ success.

Focusing investments on enabling partner growth will have a cyclical effect. Participation improves performance and revenue, which naturally results in future participation. Through participation, partners become more marketing mature.

Opportunities for Improvement

When assessing ways to improve your partners’ marketing maturing, program participation, and investment, ask yourself a few questions:

  1. What percent of total company revenue can be attributed to your channel marketing program and local partners?
  2. Where do your partners fall in BrandMuscle’s Local Marketing Maturity Matrix?
  3. What are the biggest challenges within your current channel marketing program that are impacting partner participation?

Ready to Help Partners Drive Sales Through Local Marketing?

Participate in BrandMuscle’s State of Local Marketing Assessment to identify which barriers are holding you back, download The State of Local Marketing Report 2021-2022, and contact us to discuss how you can create more marketing mature partners who invest in local marketing.

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