Marketing Development Funds: Use ‘Em or Lose ‘Em

Renee Cancro

B2B marketing development funding (MDF) from sponsor vendors to fortify their channel partners is both a marathon and a sprint. In this blog, find out why you need to plan ahead and then boldly deliver on this important, and often hidden, source of funding.

Every year, the typical marketing budget for an IT reseller or partner includes a mix of new media and special event opportunities funded by Marketing Development Funds or MDF. You might use a different term for MDF, such as sponsored channel marketing, discretionary business development, co-marketing, or reseller growth funding. Whatever you call it, you should accept and allocate these funds because they are typically lost if you don’t use them.

In fact, I found a few industry sources that suggested billions of dollars in vendor funding remains unspent each year. Don’t let your opportunity slip! Contact your channel partners and clarify with each one exactly what your MDF budget is for next year. Once you have this number, it is important to carefully review the funding expiration dates and mandatory proof of performance requirements for allowable activities.

Value of MDF

It is important to value the role MDF plays in the product launch and sales cycles. Through the magic of MDF, the big brand names are calling on their partner network to wave the banner, promote awareness, increase lead gen, and drive sales.

With MDF dollars, you can:

  • Try new marketing methods, techniques, and options
  • Focus on industry verticals and channel partners
  • Leverage co-branding to connect global brands with regional markets
  • Spread cost-of-sales over a wider audience
  • Diversify the marketing mix through social media
  • Increase demand through traditional and new media
  • Engage with more new customers
  • Convert more new customers
  • Analyze metrics and refine your approach over time

Getting Started with MDF

To renew your MDF efforts or start a new partner program, you need to designate an administrator or manager who will oversee the project planning and financial transparency of the program. He or she will develop relationships with vendors and improve the efficiency of the reimbursement process.

Your dedicated staff person will be able to expand the range of events and activities implemented under the MDF umbrella. To give you new ideas, here are some recent examples highlighting some of the ways we’ve used vendor funding for lead generation:

  • Social Media Campaigns
  • Content Marketing: Videos, blogs, whitepapers, etc.
  • Search Engine Optimization (SEO)
  • Online Advertising & Banner Ads
  • Printing, Publishing, and Marketing Collateral
  • E-Mail and Direct Mail Marketing
  • Customer Success Stories
  • Conferences, Trade Shows, and Special Events
  • Promotional Items
  • Sponsorships
  • Technical Training and Incentives
  • Demo Equipment
  • New Websites and Website Upgrades

To help you prioritize, always estimate the percentage of leads you expect and the total attendance or market audience from each segment or activity. Follow the analytics data and track the metrics to the best of your ability to be sure you allocate the right proportion of MDF funding the following year.

The Final Word

Looking to assess how you did? After six months of new MDF initiatives, ask yourself these questions to help you measure performance and renew your focus.

Did you meet your lead generation goals? If so, great! If not, why?

Lead generation tactics not based on goals cannot result in measurable success. Did you engage with and convert more new customers? Obtain your goal of quality leads? Analyze which events, campaigns and content strategies were most successful as well as which ones didn’t quite make the grade. You’ll be able to adjust your plan accordingly for next quarter and come up with a new plan and set of ideas.

Did you capture the metrics and adjust your plans based on real data?

When evaluating your campaigns, you want to capture reports, charts, and dashboards that show how you maximized every dollar of MDF. You will need to identify what is not working and cut your losses or make improvements. Do not adjust what is working. For example, if a popular video or whitepaper download is still generating 50 new leads per week after twelve weeks, resist the urge to make any changes. Apply lessons learned from analysis of clicks, sessions, and user behaviors.

Utilize different platforms and tools to help you capture these metrics and streamline your activities. Tools like Marketo, Salesforce, Google Analytics, Microsoft Power BI, Campaign Monitor, Hubspot and Adobe Experience Manager, can help you understand your customers based on their preferences and, more importantly, their actions.

Did you target the top regional markets?

Small businesses often succeed in niche local markets; however, mid-size and large businesses enjoy more sustained success when they blend brand might with regional appeal. Understand the history and motivations driving your customers and design your MDF campaigns to appeal to them. Share some of your insights with your MDF vendor. Impress upon them that you are a valued strategic partner and worthy of their continued MDF investment.

Renee Cancro

Renee Cancro, Marketing Operations Manager

Renee Cancro, Marketing Operations Manager, began her career with CDI in 2005 and is responsible for the coordination and administration of all marketing development funds (MDF) and proof-of-performance (POP) reporting. In her current role, she also assists with companywide event management, database management and mining and maintaining strategic partner marketing relationships. Renee has achieved advanced channel marketing accreditations and certifications with many leading OEM partners. She holds a Bachelor of Science in Business Administration and Marketing from Montclair State University.