According to Marketing Channels, “Producing and managing information well is at the core of developing distribution channel excellence.” Marketing research firm Gartner reaffirms this statement by noting that small and mid-sized companies can go a long way towards leveling the playing field with larger competitors by taking advantage of affordable new web technologies. Furthermore, manufacturing and service companies that sell through partners are a competitive advantage if they actively use the Internet to better manage their distribution channel relationships.

A crucial component of an effective channel strategy that leverages Internet technology is the “partner extranet”. A partner extranet is a website maintained by a company for the private use of its distribution partners – wholesalers, retailers, dealers, agents, etc. Each partner is given permission-based access to information specific to that partner’s relationship to the company. It automates many channel management and communications tasks and provides channel members up-to-date information on products, pricing and marketing programs. If effectively used, a partner extranet can enable two-way communications, facilitate collaboration, lower the cost of delivering support, enhance program effectiveness, improve customer service and increase sales.

Well-executed extranets make partners more productive, successful and loyal – and all this at a low overall cost of ownership. Moreover, the payback period can be short, that is, measured in months and not years. Another advantage, companies can easily keep the information on their extranet current, so partners can find everything they need.

Research shows that channel members are increasingly viewing partner extranets as very important in sizing up potential vendors. It is vital to remember at all times that when a channel partner is visiting your site you have the attention of a critical audience to engage or turn away. At this moment, the power is in your hands.

By nature, channel partner communications is dynamic because it occurs within the context of the competitive environment. Plans and programs are always subject to revision in response to competitive moves and counter-moves. A partner extranet should automate and facilitate the flow of partner communications in the context of constant change.

A channel manager always has two very important tasks:
• Minimize the cost of running the marketing channel in order to preserve profit margins;
• Spend enough to guarantee the generation of the desired sales.

There is no doubt that achieving the above two points are a demanding task.

Therefore, an effective partner extranet should enable and empower channel marketers and channel sales professionals to communicate directly with their channel members (be it one-to-one or one-to-many).

Very importantly, this also means customized content for particular members at whatever time they require it. Well –executed extranets can dramatically improve communications speed and effectiveness and change the competitive landscape.

For a partner extranet to pay off, it must perform these tasks well:

• Content must always be up-to-date and relevant to the partners’ sales missions. Use the extranet to quickly spread the word about new products, services, promotions, and policies, including accurate gross and net pricing.
• Get the pulse of your channel with easy-to-use online surveys.
• Offer competitive head-to-head product analysis – how does your product stack. up against the competition. Arm your channel members with the information they need to win business.
• It must be easily maintained by non-technical personnel.
• Find articles in trade publications – in addition to marketing collateral, content management allows the extranet to be quickly linked to trade publications that mention the company, allowing partners to be up to date on the latest news.
• Trade shows & Seminars – Partners should easily access a schedule to see what relevant events, training sessions are available. In addition, if there is a fee to attend, payment should be easily processed.
• Problem Solving & Knowledge Transfer – through discussion groups and surveys, companies can leverage and extend the value of their “human capital,” bringing problems to resolution faster, automating the channel evaluating and feedback process, and improving overall channel efficiency.
• Include e-learning – study materials and online testing and certifications. An e-learning capability, available on your partner extranet, that re-packages traditional training materials, provides an easy way to leverage your training assets across your channel partners. This provides a self-service avenue for increasing distributor confidence, and making your products easier and more comfortable to sell – which has the distributors win, and you win too by increasing overall sales performance.
• Above all, partners must be able to navigate the site easily quickly find what they need.

An effective extranet fosters communication between the company and its partners, and creates an environment that brings partners back to the website again and again, knowing that they will always finds the information they need to have an edge with you product.

The most important measure of a Partner Extranet may be the less tangible results that occur by virtue of the closer relationship fostered and support that channel partners’ experience.

It is critical to note that it is not the manufacturers who own the partner extranet but the channel partners.

The direct value of a partner extranet is to the distribution partner. The focus is on having the partner be successful and empowered to produce the results, in other words – sales.

To sum it up, when used effectively, partner extranets:

• Increase communications effectiveness while lowering the costs
• Provide partner education
• Reward performance
• Reinforce your value proposition
• Build one-to-one relationships with channel partner employees
• Build communities centered around your products or services
• Erect barriers to entry.

So, ensure you are using your partner extranet to its full potential see to it that it drives productivity through your channels.