If you’re like most partner organizations, chances are you’ve heard of market development funds programs – or “MDF” for short – from the providers you work with. The purpose of these funds is to help you run effective marketing campaigns and be more successful. After all, your success is contributing to their success.
Why are we writing this article?
Reason #1: Lots of provider MDF goes unused. Generally, these are resources that you’ve either earned through your sales or have access to through your partnership. Letting it go unused is a wasted opportunity to stretch your company’s marketing efforts.
Reason #2: To tap into these MDF resources, you need to prepare a solid business case and plan. In our experience, many submissions have very little thought behind them or are lacking a sound plan from a reporting and tracking standpoint.
What is MDF and what is it for?
Market Development Funds (MDF) are designed to assist a partner’s revenue-generating activities by co-funding programs that drive growth in the business partnership. Not every supplier has a formal MDF program or budget set aside for partners to access these resources. Focus on your top partnerships and ask about availability.
It is typically granted in one of two ways:
- You automatically earn it through your sales.
- You apply for it through the provider.
What isn’t it for?
- MDF is only granted to partners who are in good contractual standing with the provider.
- It is generally not used for funding company employee costs or to cover overhead that is considered standard operating costs for your business.
- Lastly, MDF is typically not available for schmooze-only events like taking clients golfing or out to dinner.
How to get MDF for your business
Step 1: Research
In order to qualify for MDF, you need to understand the provider’s expectations up front. To start, request a copy of the provider’s MDF guidelines (if available). Many of them have documentation that explains exactly what they will cover, won’t cover, and how to apply. If they don’t have formal guidelines, ask the provider if they would consider reviewing a detailed business case for these resources.
Next, request a call with the provider to review expectations. Let them know what you’re planning, and ask for their feedback. Make sure you clearly present overall goals for your campaign or request!
While on the call, ask for examples of others who have been successful with their programs. This will give you ideas to add to your own, and chances are that if another agent was successful with a particular strategy, the provider is more likely to fund a similar one with you.
Finally, ask if they have a preferred format for submissions. This will ensure your request gets processed quickly with less back and forth.
Remember, the provider wants to give you the funds. They just want to ensure it will be spent wisely with a well thought-out plan and an acceptable ROI.
Step 2: Create your plan
Armed with information from your provider, it’s time to tackle your plan. The more specific the better, as it demonstrates you have put thought into your plan.
Here are some questions to consider addressing:
- Is your campaign aimed at new business, retention, or upselling?
- Will you be targeting a specific vertical or market segment?
- Will someone be helping you implement the plan, like an agency or contractor?
- Have you had success with similar strategies in the past?
- What specifically are you requesting it for? (examples below)
- What is your timeline? What will happen when?
Make sure to follow the MDF application guidelines and instructions provided to you. And again, more information is better here. You want to instill confidence in the provider so you’re more likely to get approved for funding. Illustrating an ROI will be critical.
Step 3: Create a budget
Go through your plan and indicate how much you are spending on each item. You may be tempted to just ask for the total amount, but remember, the provider wants to see details. While this can seem a little tedious to break out the budget by line item, it will save you time in the back-and-forth with the provider. Make sure you understand from the provider the timeline in which you’ll receive the MDF so you can plan your campaign effectively.
Remember to include any documentation or forms from the provider.
Step 4: Include goals and projections
This part may be the most difficult yet the most important piece of your application. If you haven’t executed similar strategies before, you may have no idea what to expect in return. That’s okay – just take your best business estimate.
Keep in mind, this is the most important aspect for the provider. They want to see a projected ROI for the funds they are giving you.
Here are some sample goals and metrics to include in your plan:
- Results of your campaign
- Number of leads generated
- Lead conversion success percentage
- Expected revenue per sale or upsell
- Number of leads closed/won
- Total sales from your campaign
- Number of attendees (in case of an event or webinar)
- Increased traffic and engagement to your website
- Estimated ROI. Do the math. Take the number of your estimated closed deals and multiply it by your average-sized deal with the provider.
- Include a timeline showing your plan to continue to work leads that come in.
Step 5: Reviews and Changes
At this point, we recommend having someone you trust review your application before submitting. Ask for feedback and suggestions. Is everything clear? Are you missing key information?
Once you’re ready, go ahead and submit it to your provider.
Keep in mind, your provider may request changes or updates to your plan, so be open to that. Also, they may want to see or approve campaign assets, like landing pages or digital ads, prior to use.
I got my MDF! Now what?
Congratulations! You’ve done the hard work to create a well thought-out MDF proposal plan and secured your funding. Now it’s time to get to work implementing your plan.
To keep your provider happy, make sure to follow through on deadlines, and respond to any requests for results in a timely manner. Consider establishing a routine cadence of sharing campaign results.
Providers don’t expect perfection, but they do expect transparency. If your campaign didn’t go exactly as planned, explain what you think went wrong, what you learned, and how you would do it differently next time.
We hope this article has been helpful to you and will serve as a resource to help make you more successful. Following these guidelines will ensure you consistently qualify for MDF for years to come and help grow your business!
*This article was co-authored by Brian Snortheim, head of agent channel marketing at Avaya.