Jeff Wood, principal, Alexander Group
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The current fintech landscape is challenging to navigate—for several reasons.
First, there are more players than ever before. A more crowded playing field means margins are getting squeezed. Businesses must work harder to sharpen their value propositions and differentiate themselves.
There are also new offerings—like embedded payments, risk functionality, and open banking—which drive the industry forward whether businesses are ready or not.
Fintech organizations are presented with two paths forward: adapt or get left behind. Adapting often means forging new relationships, carving out new revenue segments, and developing sales coverage models to take advantage of these opportunities.
It used to be enough for fintech organizations to offer only core services like payment processing. But thanks, in part, to the proliferation of technology, these services are now easily commoditized. Fintechs must expand beyond their traditional offerings and find new ways to add value.
Businesses must meet the moment to address these challenges. Otherwise, they’ll be too late to ride the wave.
Doing more doesn’t mean losing balance
With so much pressure to grow, business leaders may be tempted to take the path of least resistance: simply tacking on more and more new services in an attempt to stand out and meet customer needs.
This method will push teams to their limits—and, if firms fail to deliver the right customer and partner support, it will jeopardize business longevity. What needs to happen instead is much more strategic.
There’s a different way business leaders can heed the call of the market; one that unlocks expansion, delivers more value for end-customers, and sets the organization up for long-term growth.
The way forward is by activating the right partner program structure, support, and enablement to drive value to customers, partners, and your company.
A partnership how-to in broad strokes.
Developing partnerships with complementary businesses will help fintech organizations expand and deepen their services through value-for-value relationships. Getting started will look different for every organization. Broadly, though, the following considerations may help establish the framework necessary to move forward.
Overall strategy
- Determine how partners will fit into your organization’s go-to-market (GTM) model. What will their responsibilities be?
- Identify your ideal partner type. What kind of services are you looking for? What would add the most value for customers? In-demand services include credit card processing, payment processing, gift cards, loyalty programs, and marketing programs.
- Determine which end-user customer segments you’ll target through the partnership. What ideal customer profile (ICP) will your partner reach? Who will this partnership serve?
- Partnerships must be mutually beneficial. What is your organization’s value proposition to future partners? How will you retain and activate them for accelerated growth?
Program components
- Now it’s time to think a little more about getting the partner program off the ground. Sales teams will need comprehensive guidance on how they should position the program.
- Facilitating training sessions is an effective way to get teams up to speed. They’ll also need to know about incentives (both financial and non-financial) and eligibility and tiering.
- Resources will need to be created to support marketing efforts, including collateral and demos.
- Customer success materials will help encourage retention and open the door for cross- and up-sell opportunities.
Execution elements
- Map out the logistics of the partnership’s channel organization, including coverage, program governance, rules of engagement, channel sales compensation, and program administration.
- Your partners are an extension of your own team. Make sure you can help them deliver the same caliber of customer experience you would. Set them up for success.
- Finally, spend some time ironing out the infrastructure and analysis. How will you incorporate metrics, tracking, and forecasting? What technology and tools will teams need to drive success? How will teams, partners, and customers communicate? Is a portal necessary? What are the necessary investments, and can you quantify ROI at this time?
These are just a few themes fintech leaders will need to explore if they’re interested in developing a fruitful partnership.
The road ahead
Of course, creating a partnership is just the first step. The bulk of the work lies in maintaining and scaling it to drive ongoing results as well as avoiding paper deals that fail to realize any benefit.
If approached thoughtfully, though, fintech organizations can use partnerships to move beyond their primary product offer and become a true platform for customers.
