Evaluating Your MDF Strategy at the Halfway Mark
July marks the halfway point for evaluating partner program spend and impact. As a leading indicator of partner-driven growth, program health, and budget performance, it’s a crucial period for program owners to assess the effectiveness of Marketing Development Funds (MDF) consumption.
The Critical Role of MDF in Partner Program Success
Large enterprises with well-established partner ecosystems often allocate upwards of 30% of their channel marketing budget to MDF. In contrast, smaller companies or those with emerging partner programs might allocate a smaller percentage, around 10-15%, as they continue to build out their MDF processes and partner relationships. It is common to budget for a 3:1 to 5:1 return on such investments.
These numbers reflect meaningful investments for vendors and significant growth opportunities for partners. However, as much as 60% of MDF remains unclaimed each quarter.
Every unused dollar of MDF is a wasted opportunity to strengthen partner relationships, accelerate ecosystem outcomes, and demonstrate program impact to secure 2025 program budget.
Strategies for Maximizing MDF Use
As we move into the second half of the year, here are several strategies you can employ to drive partners to claim outstanding funds, thereby accelerating demand and pipeline conversion by the end of year:
1. Provide Partners with Options and Support
Your ecosystem is made of partners with varying levels of marketing expertise, resources, and needs. Offer a catalog of turnkey MDF-approved packages and services that partners can easily select from and activate to maximize the effectiveness of their MDF. These offerings can include marketing content creation, paid media services, lead gen campaign execution, and event support (virtual and/or in person). Tailor the offerings to the partner type: what will activate an ISV is different than what will resonate with an MSP or GSI.
2. (Re)communicate the Value and Availability of MDF
At the beginning of each quarter (now for Q3!) proactively communicate to your partners about the availability of MDF: amount offered, deadlines for use, recommended activities it can be applied to. A structured communication plan that includes emails, social media posts, and direct interactions can significantly enhance awareness and engagement.
3. Highlight Partner Success Stories
Motivate your partners and create a sense of urgency (and healthy competition) to utilize available funds. Showcase examples of partners who have successfully leveraged MDF to achieve tangible results. Incorporate best practices and suggest next steps to make these examples immediately actionable for your partners.
4. Demonstrate Partner ROI
Partners are more likely to use MDF if they can see the direct benefits. Point to data that shows the impact of MDF-funded activities across your partner set. Confirm your commitment to providing performance insights regularly and encourage your partners to do the same (if it is not already a proof-of-execution requirement). A transparent MDF performance feedback loop between you and your partners is critical for guiding program and funding optimizations, in addition to improving immediate results.
5. Clarify the MDF Process
The process of claiming and using MDF must be simple. While it may not be feasible to update your MDF management processes and tools mid-year, taking small steps to re-surface program guidelines and resources to partners can help reduce administrative friction in the short term. Ensure all program documentation is quickly discoverable online. Make the content easy to consume through videos, recorded webinars, and guided process demos. Conduct open office hours to field questions from partners.
Effective utilization of MDF requires a combination of clear partner communication, valuable marketing activities aligned with your partners’ marketing priorities and investments, and comprehensive execution support.
With the end of the year quickly approaching, now is the time to accelerate partner usage of funds to ensure mutual growth and success to close out 2024.
Empower Your Ecosystem with Bridge Partners
By partnering with Bridge Partners, you can unlock the full potential of your partner ecosystem. Let us help you achieve your goals and drive significant results, ensuring your MDF investments lead to mutual growth and success. Our turnkey partner packages and services are designed to elevate your partner programs, enable your channel, and accelerate your pipelines. See how Bridge Partners can help you.
