Let’s face it. Being offered funding to boost your marketing efforts seems too good to be true, right? Wrong! That’s exactly why Marketing Development Funds (MDF) exist.
However, as a partner, the process of securing and executing MDF, followed by the next steps of claiming, date stamping, and providing POE (Proof of Execution) can be a bit of a minefield! And then there’s the challenges faced by vendors who need to ensure their MDF marketing dollars are being spent in the most effective way – and that they’re getting the maximum return.
At ResourceiT we have a huge amount of specific channel experience, and are perfectly equipped with a knowledgeable, agile team to help maximise your MDF opportunity. Read on for our top tips on how to secure, spend, and simplify the MDF process.
Let’s start with the basics, what is MDF?
MDF is a resource, granted by a vendor, which is allocated to indirect sales channel partners, including resellers and distributors, to pay for and support partners with their sales and marketing programs. This is typically to support with the promotion of a specific product or service.
What’s in it for channel partners?
MDF gives channel partners the opportunity to run a partially or fully funded campaign, without the need to tap into their own marketing budgets. For some, MDF is critical to their marketing plans and can make up a majority of their marketing spend in a year.
What’s in it for vendors?
By leveraging the relationships, connections, and loyalty developed in their regional market or chosen vertical(s), vendors can further their sales and marketing reach along with brand awareness. MDF means channel partners tap directly into their regional customer base, kick-starting sales in that specific market, that perhaps the vendor wouldn’t have been able to achieve alone.
Let’s take a look at the top five things you should know about MDF to make your opportunity a success.
1. Allocation frequency
Many of the vendors we work with release quarterly MDF funding, with set execution and claiming deadlines. Deadlines must be upheld in order for partners to be paid, however it is not uncommon for some MDFs to be paid at the beginning of the agreements due to cash flow considerations.
It’s important for partners to understand individual vendor calendars to better determine allocation frequency, along with reporting and claims requirements. Each vendor will have a set budget for each partner and each program, along with a period during which fund applications will be accepted. Understanding the nuances of each vendor’s MDF process is crucial.
2. The importance of collaboration
For partners and vendors to successfully increase sales and drive demand generation, we recommend close collaboration to identify marketing activities that are mutually beneficial. Sharing ideas and discussing joint objectives, as well as lead generation and sales strategies, will help reassure both parties that their end goals are aligned. It’s important to remember that the vendor will also have valuable insight about marketing strategies that work well with marketing and selling their products and services which should always be taken into account.
3. Justifying projections
To meet vendor ROI goals, partners need to show marketing plans that include how their strategies will be actualised from the funds allocated. For example;
- What will be spent on each initiative?
- How will the financial goals be achieved that were approved for this plan?
To help justify MDF projections it’s important to share who the target market is, what vertical or market they’re in, and what the lead generation programs will look like – including any events, social media activity, and collateral that will be developed. To realise more return from their MDF funds, vendors must strategically plan, budget, and allocate funds, and consider the option of creating a financial incentive program. Awarding partners can entice them to generate more leads from their marketing initiatives, and encourage them to continue promoting the vendor brand into the future.
4. The submission process
Each vendor will have a pre-determined application process, for which it’s critical partners understand the required format. If you’re a partner, make sure you know who to submit the application to, what documentation is mandated and of course, when the deadline is. This is something we here at ResourceiT specialise in, and can take your submission headaches away using our years of experience and knowledge in this area.
5. Follow up
Accurately tracking spending and measuring results is vital, but it is an often overlooked part of the MDF process. Partners must document the leads, opportunities and ROI that results from the MDF campaign and provide follow-up reporting and POE (proof-of-execution) on these MDF-backed programs. This helps the vendor evaluate the effectiveness of the allocated MDF, enabling them to build the case for securing additional funds next time round.
Whether you’re a partner struggling with MDF complexity or a vendor looking to maximise your MDF ROI, ResourceiT are set up to effectively administer, manage, and measure your MDF program.
We support partners by helping them secure and execute their MDF in the best way possible, and provide vendors with approved, time-stamped reporting and POE. By simplifying the management and reporting process and saving you time, we enable you to focus on executing a successful MDF program that creates new opportunities and builds pipeline for your sales team.
To discuss your requirements and learn more about making MDF work for you, get in touch with us today.