Insights Insight 08

08Partner funding - value

Your network can create value beyond the budget you put into it.

A dealer network matters to more businesses than the manufacturer alone. Suppliers, service providers and commercial partners also have objectives that depend on what happens across it. That creates an opportunity to make the programme commercially bigger than its original budget.

Sherbet InsightsPhil O’BrienAugust 20265 min read

Dealer networks create enormous commercial value.

  • They sell vehicles.
  • Maintain them.
  • Supply parts.
  • Sell accessories.
  • Arrange finance.
  • Build customer relationships.
  • Represent brands in hundreds of local markets.

And around that network sits a much wider automotive ecosystem.

  • Oil and lubricant brands.
  • Tyre manufacturers.
  • Parts suppliers.
  • Accessory providers.
  • Finance businesses.
  • Insurance providers.
  • Charging companies.
  • Technology businesses.
  • And many others.

These organisations often have something in common.

Their own commercial objectives can be influenced by activity across the dealer network.

That makes them more than suppliers.

In the right circumstances, they can become programme partners.

Start with aligned interests

The important phrase is in the right circumstances.

This is not about selling access to the network or filling a programme with third-party promotions.

The starting point should be alignment.

  • What does the manufacturer want to achieve?
  • What does the partner want to achieve?
  • What would be useful to the retailer?
  • What makes sense for the people participating?

If those interests overlap, there may be an opportunity to create activity that produces value for everybody involved.

Take an aftersales environment.

  • A manufacturer may want to grow workshop performance.
  • A relevant supplier may want greater penetration of its product.
  • The retailer benefits from additional commercial activity.
  • The participant has a clear objective and an opportunity for recognition or reward.
  • The customer receives an appropriate product or service.

One activity can create value in several directions at once.

The network value flywheel

Dealer network at the centre

  1. ManufacturerCommercial priority
  2. PartnerRelevant product + funding
  3. PeopleAction + recognition/reward
  4. Customer outcomeValue created
  5. ↑ And back to manufacturer and partner

More valuemore activitymore engagementmore value

The programme doesn’t only distribute value. It can help create it.

A circle with the dealer network at the centre and four stations on the ring, each connected to the centre: manufacturer, commercial priority; partner, relevant product and funding; people, action and recognition or reward; customer outcome, value created. Value moves around the ring and outward from the centre to every station, and the cycle reads: more value, more activity, more engagement, more value.

Partner funding enters the ecosystem. Value flows to everyone in it. Illustrative, not client data.

A network is an extraordinarily valuable route to market

For an appropriate partner, activating hundreds of retailers independently would be difficult.

The manufacturer already has something much more powerful.

  • A connected network.
  • Known retailers.
  • Known roles.
  • Established commercial priorities.
  • Performance information.

An existing programme can provide a structured way to bring those pieces together.

That means partner activity can be more precise than simply communicating an offer to everybody.

  • Which retailers represent the greatest opportunity?
  • Which roles can influence the outcome?
  • What behaviour matters?
  • How will success be measured?

The same principles that improve manufacturer-funded activity also apply to partner-funded activity.

Start with the objective. Find the audience. Define the behaviour. Then design the activity.

Partner funding can enlarge the programme

Most programmes begin with a budget.

That naturally creates a boundary around what can be done.

But if appropriate partners can fund activity that also supports the manufacturer’s priorities, the total value available to the programme can grow.

  • That additional value might fund rewards.
  • Activity.
  • Recognition.
  • Experiences.
  • Communications.
  • Or other programme benefits.

The precise commercial structure will vary.

The strategic point is simpler:

The value available to a network programme does not necessarily have to equal the amount the manufacturer originally puts into it.

A well-structured programme can attract additional investment because it creates measurable commercial value for organisations beyond the OEM.

Relevance is what protects the model

There is an obvious risk.

Add too many commercial partners and a useful programme can begin to feel like a marketplace.

That would undermine the very thing that makes the opportunity valuable.

The programme has the attention of people across the network because its activity is relevant to their working lives.

That relevance needs protecting.

A partner belongs in the programme when there is a credible connection between its objective and the network’s commercial activity.

Not simply because it has budget.

That creates a useful test:

Would this activity still make sense to the retailer if the partner’s funding were removed?

If the answer is no, it probably doesn’t belong.

Data makes partner activity more accountable

Traditional trade activity can sometimes make attribution difficult.

  • A partner funds something.
  • Activity takes place.
  • Sales are measured later.
  • The relationship between the two may be unclear.

A connected programme creates the possibility of a more measurable model.

  • Who was eligible?
  • Who participated?
  • What activity took place?
  • Where did performance change?
  • Which retailers responded?
  • What was achieved?

The available level of measurement will depend on the programme and data, but the principle is important.

Partners are not simply buying exposure.

They are supporting defined activity against a defined commercial objective.

That makes the proposition more valuable to them and more defensible to the manufacturer.

The programme team remains in control

Partner participation should not mean handing over the relationship with the network.

The manufacturer and programme team determine what is appropriate.

  • They define the audience.
  • They approve the activity.
  • They decide where it sits alongside other priorities.
  • They retain visibility of what happens.

That keeps the programme coherent.

To the participant, it should still feel like part of the same programme they already know rather than a third party arriving with an unrelated campaign.

The partner contributes to the ecosystem.

The programme remains the organising layer.

Partners can bring more than money

Funding is the most obvious contribution, but it is not the only one.

A partner may bring expertise.

  • Products.
  • Experiences.
  • Content.
  • Access.
  • Recognition opportunities.
  • Customer value.
  • Or something distinctive that makes participation more interesting.

That opens the programme beyond the traditional equation of:

OEM budget → incentive → participant

The value exchange can become much richer.

And because different partners are relevant to different commercial priorities, the ecosystem can evolve with the programme.

The strongest programmes can become commercially productive

This changes how we think about programme economics.

An incentive programme is often viewed primarily as a cost.

  • Platform cost.
  • Management cost.
  • Reward budget.
  • Communication cost.

Those investments should produce a return through improved performance.

But a programme capable of attracting appropriate commercial partners introduces another dimension.

It can potentially generate funding as well as consume it.

  • That funding supports more activity.
  • More activity can create more value.
  • Demonstrated value makes future partner participation more attractive.

This is the flywheel.

Not an endless stream of sponsorship.

A carefully controlled ecosystem of aligned commercial interests.

The network is the asset

This series began with a simple idea:

One dealer network can become many different audiences depending on the commercial priority.

That same idea creates the partner opportunity.

  • A tyre manufacturer may care about one audience.
  • An oil company another.
  • An accessory provider another.
  • An EV charging partner another.

The programme can identify the relevant part of the network rather than offering everybody the same thing.

That makes partner activity more useful.

More measurable.

And potentially more valuable.

Create value, don’t just distribute it

Reward programmes are naturally associated with distributing value.

  • Points.
  • Cash.
  • Products.
  • Experiences.
  • Recognition.

But the more interesting commercial opportunity is to build a programme capable of creating additional value around the network itself.

  • The manufacturer has priorities.
  • Partners have priorities.
  • Retailers have opportunities.
  • People across the network can influence them.

Bring those interests together intelligently and the programme becomes more than a budget to administer.

It becomes a commercial platform.

The network creates the opportunity.

The programme connects it.

And the value created can become considerably greater than the budget you started with.

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