Solving the MDF conundrum

If you’re in or around “The Channel” marketing-wise you’ll be all too aware of the world of MDF. So, skip this first bit and head to the paragraph titled “The Awkward Reality of MDF” instead.

If you’re not channel-literate, MDF in this instance isn’t medium density fibreboard (as many think). Why would we be talking about the franken-wood made infamous by Handy Andy off of ‘Changing Rooms’ around the turn of the century? (The fact that programme has only scored 6.6 out of 10 on IMDB is a travesty in our opinion. Shout out to Carol Smilie too.)

Anyway. In this context MDF means Marketing Development Funds.

You might have heard them called Co-Marketing Funds (CMF), Partner Marketing Funds (PMF), Joint Marketing Funds (JMF) or something else but it’s all the same principle. It’s an incentive used by vendors where budget, resources, and/or campaign materials are made available to channel partners to run marketing activity in a (supposedly) joined up way with the vendor.

Sounds great on the surface doesn’t it? Free money and “stuff” for partners to run campaigns. Loads more marketing activity for the vendor. A healthy pipeline for everyone. It’s a win-win, surely?

Unfortunately, in most cases it isn’t.

The awkward reality of MDF

The sad fact is that roughly 60% of all MDF made available goes untouched (according to channel gurus, Zinfi Technologies). But why would that be? Well, there’s 3 main reasons that spring to our mind:

Vendors are too self-obsessed

Fair enough, vendors are giving the MDF away so they’ve every right to make it all about them if they want to. And many do. But doing so doesn’t really help anyone. If MDF doesn’t help partners deliver more of what matters to THEIR business rather than just the vendors, then why would they even bother? Short answer; they don’t.

Also, taking a “one-size-fits-all” blended with a “build it and they will come” approach sprinkled with a topping of “zero support to actually deliver” just reinforces that it’s far more about the vendor than the partner when it comes to MDF…

MDF: A short play.

VENDOR: “Howdy Partner, we’ve got a couple of stock decks and some half-decent email copy in a portal for you. How about we bung you a few quid (that you have to spend first and then claim back once you’ve done what we want you to) and you can send them to your data base to generate some more business for me…I mean us. US. Definitely meant us.” 

PARTNER: “oh, wow. Thanks vendor…I think. We’ll let you know. OK bye”

*CURTAIN*

You see what we mean. This kind of approach doesn’t work for any other facet of marketing, so why would it be any different for MDF. Another short answer; it isn’t. And it’s one reason why so much MDF gets left on the table

Partners haven’t got their act together

Vendors can’t (and shouldn’t) shoulder all of the blame though. They could set up the greatest MDF scheme the world has ever seen with fully customisable campaigns and 24/7 support, but if their partners lack the marketing brain power and/or resources to deliver then it’s all just going to be chucking money into a ROI black hole.

Partners will often be much smaller than vendors and either won’t have a dedicated marketer or marketing function, or they’ll have a small marketing team that are stretched so thin that dealing with a vendor to get something off the ground will be too much of a ball ache to bother with.

Other things are a higher priority and MDF is placed on the tiniest of back burners. Or just taken off the hob altogether.

It’s all painfully short-termist

For the vast majority of MDF engagements what it all boils down to is a need to generate sales and generate them NOW. Or at the very most by the end of whatever quarter you’re currently in.

Clearly marketing have a responsibility to generate opportunities that convert to sales, and sales and marketing should be working hand-in-hand. But you’d never (or you shouldn’t) measure the performance of marketing activity based purely on sales. The same way you wouldn’t measure the performance of a sales team based on Share of Voice or Inbound enquires.

So why is funding that’s specifically meant for marketing measured that way? If you’re funding the development of anything, it’s not marketing. It’s sales. So, something’s got to change.

Solving the MDF conundrum

So, having looked at why the current approach to MDF is a bit broken for most, what can vendors, partners and the rest of us do to fix it? We think the following is a pretty good place to start:

Let’s all shift mindsets (one way or the other)

If we want to keep calling it MDF, then there needs to be change in how success is measured. And that’s to make sure the measures of success are something that’s directly related to marketing rather than just purely sales.

Or, if you want to keep the focus on sales let’s call it something different. Sales Development Funding, Business Development Funding, Partner Development Funding? We’re not fussed, really. Just give it a name that actually describes what it does.

Vendors – go for a walk in your partners shoes

Don’t assume that as a vendor just because you’ve pulled some “stuff” together that partners are going to come flocking. There’s got to be something in it for them above and beyond the “honour” of selling your product for you and getting access to some prescriptive, one-size campaign content (that loads of other partners will probably be using too).

Work with your partners and tailor what MDF (or whatever you call it) looks like for them. Do they need content? Do they need access to experts? Do they need an email or marketing automation platform to use? Do they need help with design or digital deliverables?

Yes, it’s more effort on your part. But you could use your pot of MDF to add REAL value for your partners, which will return far more value for you over the long term.

Partners – push back on your vendor

If you’re a partner suffering in silence when it comes to MDF, make yourself known.

Want to make use of the MDF that’s on offer but not got the time, resources or skills to do it? Struggling to deliver what’s being asked of from your vendor for whatever reason? Unsure how to approach an MDF application and prove that it’ll work for the vendor? You’ve only got yourself to blame for not being more vocal.

And chances are if you’re feeling a certain way or having a negative MDF experience you won’t be alone. There’s bound to be others out there in the same boat, who want to access MDF but aren’t sure how to make it work. It might take some pushing, but make your vendor listen.

———-

If you’re a vendor struggling to see the ROI in your current MDF set up, or you’re a partner who wants to make far more of the MDF on offer then we should have a chat.

We’ve helped vendors and partners alike to make more (and make the most) of MDF…or whatever we’re going to call it from now on.

Get in touch using live chat or via the link below.