Leveraging Indirect Sales: How I Learned To Sell More By Selling Less

In a previous role selling software, I kept running into the same issue. Despite winning demos from researched and personalized pitches, I struggled to convince prospects to rip and replace a competitor’s solution. Most of them had used the industry incumbent for years. The cost and uncertainty of a migration just wasn’t worth the effort despite our product’s advantages.

After a few early months of banging my head into a wall, I was lucky enough to demo the product for an inbound lead who hit me with a revelation: He had reached out at the direction of a trusted consultant who knew the market inside and out. That consultant recommended our solution as the best fit for the client’s needs.

Not surprisingly, the sale was a layup, and my mind was racing when I hung up the call. Could I rely on someone else to do some of the selling for me? Spoiler alert: Yes, I could.

This is how I discovered the power of indirect sales. I’ll share what I learned with you so you can leverage indirect sales, too.

Table of Contents

• What is indirect sales?
• Who should I partner with for indirect selling?
• Benefits of Indirect Sales
• 6 Tips for Indirect Selling Success

What is indirect sales?

Indirect sales refers to the sale of a product or service through a third party — such as a partner, reseller, affiliate, or distributor — rather than through your company’s sales team. In other words, someone else is selling your product on your behalf, benefiting both you and the reseller.

This concept is often contrasted with direct sales, where your employees sell straight to the consumer or client. (Think: your in-house sales reps closing deals or a company with an ecommerce store selling its products directly online.) Both models have their place, and many businesses use a mix of direct and indirect channels.

Who should I partner with for indirect selling?

In the example I cited above, I was still making that sale for my company — I just had a much easier time of it because the prospect was referred to me by a trusted advisor. Those sales transformed from direct to indirect the moment that consultant signed a referral agreement with my company.

In return for sending clients our way, we agreed to pay a referral commission. Over the next 24 months, that agreement proved to be a huge source of sales for me and a nice monthly commission for the referrer. I still have a great relationship with that consultant to this day. Besides referral agreements, indirect sales can come from a variety of sources.

Resellers and VARs (Value-Added Resellers)

Resellers and VARs are independent businesses that resell a product, sometimes after adding their own services or bundles.

For example, a local IT consulting firm might whitelabel and resell a big software company’s product as part of a total solution for clients. The firm’s clients see the name and logo on the software instead of the creator, and they cover all or part of the cost the firm is paying the creator.

Distributors

Distributors are intermediaries who buy products from the original manufacturer and then distribute them to retailers or end-users. Many consumer goods companies (think products you buy in the grocery store) use wholesale distributors and grocery chains to get products into many stores.

Affiliates

Affiliates are individuals or organizations that promote your product and earn a commission for each sale or lead they generate. An example might be a blogger who earns a cut every time a reader buys a product using the blogger’s referral link — that’s indirect sales via affiliate marketing.

Franchisees or Agents

In some cases, companies license others to sell under their brand (franchise models), or they have independent agents represent them in the field.

These situations fall under the indirect sales category because the actual seller isn’t the company itself but instead a partner or contractor operating under the company’s umbrella. Think fast food chains or individual agents who sell beauty and health products.

Benefits of Indirect Sales

Adding an indirect sales strategy to your overall sales plan allows for scale. In my own experience, indirect sales have provided a pipeline of warm leads that I simply couldn’t have gotten without a partner in my corner. Once I set up a referral agreement, my company was able to expand its sales team without increasing headcount, making it an efficient source of growth.

Despite the wins it generated for our organization, indirect sales weren’t just “free money.” I had to manage a relationship and interface regularly with the referral partner to ensure we were in alignment. I also calculated commissions and wrote checks each month for the business the partner brought in.

Still, I found the juice to be well worth the squeeze. If you think indirect selling will drive results in your sales process, let’s talk about how to do it effectively.

6 Tips for Indirect Selling Success

1. Define your partner strategy.

What role do you want your partners to play in your sales process? Where can they have the biggest impact? In the example I mentioned at the beginning of this article, I was connecting with plenty of leads but struggling to find the ones who were actually in the market for my product.

My referral partner helped turn that around by sending me leads who were primed to buy. As an added bonus, I knew ahead of time that our software was a good fit for their needs.

2. Create an ideal partner profile.

In the same way you build out an ideal customer profile (ICP) to make sure you invest valuable time in the right prospects, it’s important to think carefully about an ideal partner profile. In my case, integration consultants were an excellent source of referrals.

Depending on your own product and industry, you might partner with consultants and implementation experts, marketing agencies, HR specialists, educators or influencers, or someone else entirely. The key is to find a complementary business that serves your target market but doesn’t compete with your offering.

3. Incentivize your affiliates.

According to Curt Frieden, senior vice president of business development at partner marketing and affiliate tracking platform Everflow, “Incentivizing your partners is critical for alignment and delight in being a referral partner.”

Frieden shares that Everflow offers a referral fee if a deal closes and pays for different stages of the deal so partners “feel the love.” Partners then “get compensated faster and more frequently than waiting through what could be a long sales cycle,” Frieden notes.

Since changing to the new incentive model, Frieden says Everflow has seen a 120% increase in leads generated through referral partners. These results inspired them to create a whitepaper and help other SaaS businesses crack the incentive code.

4. Offer enablement resources.

If you’ve built the right incentive structure, a win for your indirect sales partners is a win for your organization. That makes it a good idea to enable these partners however you can.

I made it a habit to coach referral partners on new feature releases before they went into production, ensuring they had the most complete picture of our software. By knowing what was coming, partners could do a better job selling for us. They could even spot upcoming opportunities when a feature was still technically in the pipeline.

5. Maintain regular communication.

It’s natural to feel like your job is done once the ink is drying on the partnership agreement. It’s out of your hands, right? In my experience, it almost never works that way.

The best partners are the ones you’re in close communication with, nurturing the relationship, strategizing together, and outlining what mutual wins you can achieve next. If new partners don’t hear from you, trust me — you’re unlikely to hear from them.

6. Don’t forget your role.

Just because a partner is bringing you referrals or perhaps even closing deals on your behalf doesn’t mean you can forget basic sales fundamentals. It’s still critical to qualify prospects or new customers thoroughly to ensure they’re a good fit, understand their unique needs, establish your own relationship, and deliver a seamless onboarding experience.

In fact, these things are even more important for indirect sales, because a subpar experience has the potential to hurt your relationship with a valuable partner in addition to costing you a customer. Need a quick refresher on some best practices? Check out these B2B Sales Tips.

Indirect Sales, Direct Impact

To me, the term “indirect sales” is a bit of a misnomer — mainly because it sounds like someone else is doing all the work. Not surprisingly, if you approach potential partnerships like you’re going to sit there and take orders as the hot leads come rushing in, you’re going to be disappointed.

Instead, go into indirect sales with intention. Leverage the tips and best practices I discussed — from carefully selecting partners and enabling their success to maintaining strong relationships and continuously improving your approach. It takes work to set up and manage a partner program, but the reward is growth that can be hard to get otherwise.

In the end, indirect sales isn’t about outsourcing your sales function. It’s about extending your reach and amplifying your sales potential. I’m fortunate to have learned this lesson early on, and I’d encourage you to sketch out a plan for an indirect strategy if you haven’t already. Your next big deal might come from someplace you never expected.