I’ve seen lots of complex models deployed to calculate the ROI of channel programs. Some involve expensive consultants conducting control group analysis combine
d with sophisticated mathematical models and techniques but are not easily deployed on a scalable basis. The consultant leaves and the analysis dies.
Bruce Cummings, a legendary channels marketing consultant, (http://www.linkedin.com/pub/bruce-cummings/0/b8b/665) espouses a refreshing approach to determining channel program ROI by using a simple “binary” technique. This technique compares the sales performance of a group of partners who participate in a particular marketing program with a group of partners who didn’t based on comparisons of actual sales-out data. Partner group “A” received the incentive during this period of time and their sales grew by x%, while partner group “B” who didn’t participate in the program saw a sales increase of y%. That’s it!
The binary method is easily implemented on an on-going basis to provide a quick check-up on the potential impact a program is having on sales. It’s not necessarily definitive but it provides a rapid check that could be done monthly—assuming the timely availability of POS sales-out data during a program’s execution.
It’s a basic but powerful approach, but are you doing it on a regular basis? Are you doing it while a program is being implemented?
