How Unbounce created a new revenue stream without building more products
Before Salesforce turned sales operations into a science, many executives believed it was a waste of time. Salesforce turned out to have a hugely profitable business strategy. Similarly, with marketing automation and customer success, business leaders were concerned mass emailing and tech platforms would de-personalize the customer experience. Now, companies can’t live without them and understand that tech brings personalization and outreach at scale.
The same goes for channel partnerships. Some executives might perceive some brand risk or potential for marketing cannibalization by leveraging a network of partners to sell for them. In reality, channel partnerships open global opportunities and become a new revenue stream for the company.
Ty Lingley, Director of Partnerships at Unbounce, the leading landing page platform for marketers, understood these concerns well when he created a new revenue stream with channel partnerships. To overcome his executive team’s concerns, Lingley knew he had to educate them on how partner channels drive revenue. He then focused on the foundational resources necessary to help partners tell the Unbounce story and on tracking the right metrics to identify success.
After just two months, Lingley delivered on his promises. Unbounce’s channel partnership program has already resulted in thousands of new partners and delivered a 15% lift in paid customer sign ups. Now, the program is ramping to full speed anticipating it will become one of the company's main revenue drivers in the next two to three years.
Revenue potential and partner brand alignment
Before launching a partner program, Lingley did a lot of research on the tangible benefits other tech firms experienced after implementing a channel program.
“I interviewed around 20 different tech companies in our space,” Lingley said. “I wanted to know the basics, like what’s going well, what’s tricky, and what would you do differently. I asked them bluntly what percentage of total revenues does channel partnerships make up. They were seeing anywhere from 8% to 25% of total revenues from this channel.”
Finally, Lingley had a compelling statistic to present to executives.
When revenue growth became the top business priority at Unbounce, Lingley presented executives with research showing how incredibly profitable channel partnerships can be. Additionally, Unbounce had already received hundreds of requests asking for a channel program. Lingley subsequently prepared a detailed plan for a channel program including a clear outline for the types of partners Unbounce would target and the amount of support and resources they would provide.
In short, Lingley showcased channel partnerships as a full revenue line item and not just a small offshoot initiative.
Channel strategy creation
“You need to start with a go-to-market strategy,” said Lingley. “Look at your segmentation. Identify higher value partners and address how you will speak to them and serve them. It’s important to do the segmentation work because you will have different types of partners, with different personas, who need to be spoken to differently.”
After explaining the segments, the support offered to partners, and confirming that partners would accurately represent Unbounce’s brand, Lingley then explained how he would promote partner success.
“Another key factor is partner on-boarding and time to value,” Lingley continued. “We had to demonstrate to our partners the value of our program and that we are here to help them be successful as quickly as possible.”
The final step in the partner strategy was the connection to Unbounce’s team. Partners are paid a percentage of revenue that Unbounce receives from customers referred by partners. But since every Unbounce subscription starts with a 14-day free trial, partners do not get paid just for referring traffic, they have to deliver high quality leads that convert to paying customers.
On the one hand, Unbounce’s commission structure paid partners a premium reward for closing high quality accounts. On the other hand, partners needed to wait for their referrals to convert to paying customers before they were rewarded for their work. To ensure partners were supported during the free trial period, Lingley assured partners that Unbounce treated its customers acquired through channel partnerships the same way they treated its customers from any other source. This not only gave the channel partners confidence that Unbounce wanted the users they referred to be successful, but also allowed Unbounce to track the quality of leads by segment and compare it to other customer acquisition methods.
Metrics that matter
In the few months since the launch, Unbounce has recruited thousands of partners. In the first 90 days, the partners in the channel program have brought over 500 new trial starts, which is a 15% lift over previous marketing channels. Lingley and the Unbounce team not only monitor how much they pay their partners in commission, but they leverage data through PartnerStack’s app to measure success, including:
- Conversion rates
- Customer lifetime value (LTV) compared to other customer acquisition methods
- Customer quality (support tickets, growth, etc.) compared to other customer acquisition methods
- Net new MRR added from Partners
“PartnerStack helped build an awesome dashboard,” said Lingley. “It’s acting as our health thermometer, so to speak, for the channel program. We use PartnerStack for all payouts, too, and it’s super easy for us to review at the end of the month. After we approve the partner rewards, PartnerStack runs all payments for us.”
Building channel revenue
The world is evolving, and with it, how companies sell is changing too. Sales people continue to evolve from cold-calls, emails, and social media posts to strategic actors that leverage networks to sell for them. Channel programs represent the next step in that evolution, and companies like Unbounce are already seeing the benefits.
Fresh off a successful beta test and the launch of their full program, Lingley is looking ahead to what’s next. Initial indicators point to channel partnerships becoming ingrained in how Unbounce does business.
“I see it as a table stakes marketing channel,” Lingley said. “As we get better at helping partners, it’s only going to continue to grow. My goal is to have channel account for at least 10% of total revenues, which I think is totally possible."