Over the last few years, Cisco has transformed from a hardware to a software-defined business, putting a great deal of emphasis on customer success. At its annual Partner Summit in November 2019, Cisco announced its new “Lifecycle Incentives Program” designed to encourage partners to do more than just resell its products and instead drive software activation and adoption among customers. However, much of Cisco’s transformation relies on partner action. For many Cisco resellers and distributors, the task of adopting a lifecycle-first approach can be intimidating. So, what is the value of Lifecycle Incentives, and how can we help?

Cisco’s Lifecycle-First Approach

Partner programs such as Cisco Lifecycle Incentives reward channel partners who ensure their customers realize the full value of the software they have implemented with them. In contrast, Cisco’s longest-running channel incentive program, the Value Incentive Program (VIP), has always been based on a measurement of sales volume; the more you sell, the more rebates you are likely to receive.

Lifecycle Incentives are now part of what we like to call a new era for channel partners. This is all about measuring the level of customer experience partners deliver to companies. The more value they deliver, the more they earn. Partners can earn additional incentives as they uncover new opportunities, expand the original client agreement and eventually renew the software.

This is a significant shift for partners in terms of where they should focus their efforts, especially in order to optimize and leverage the new Lifecycle Incentives benefits.  Historically, compliance management has always been fundamental and played a significant role in the program. The amount of compliance and the level of their relationship with Cisco determines the amount of incentive partners can receive, and it is no different with Lifecycle. By remaining compliant, partners are eligible for all different tracks of rebate. But now partners have to take this one additional step by managing and monitoring the level of customer experience (CX) with Cisco. Customer experience is now an eligibility requirement for the level of opportunity they receive from Lifecycle Incentives. The higher the CX level reached with Cisco, the more opportunities partners are able to work on, with the ability to enrol on different lifecycle incentive rebate tracks.

Shifting to a Customer-Centric Model

The opportunities for Cisco’s partners are significant. However, from what our customer success team has seen on the ground, partners and vendors require a level of support to implement lifecycle practices and manage their own programs, and this is where Vortex 6 comes to the fore.

We have a thorough understanding when it comes to the issues and challenges our partners face. For example, channel partners need to adapt to changing business models working with Cisco, with the emphasis now on moving towards a more customer-centric model, rather than focusing on transaction volumes and sales.

Lifecycle Opportunities are Slipping Under the Radar

Lifecycle Incentives is a quarterly based program which differs from the Value Incentive Program (VIP), where partners wait six months to see the incentive and the rebates they’ve been working towards achieved. Lifecycle Incentives lead to quicker rebates earned and therefore partners can start to receive a return on investment in a much shorter timeframe.

For over a year now, partners have been creating opportunities and starting to understand how the program works and, as a result, building their own lifecycle practices. The challenge that still remains is understanding where the opportunity comes from and the key actions required to optimize the rebate and reward opportunity. Some are doing this purely based on data, others are relying on internal sources such as the sales team to identify when a lifecycle opportunity has appeared. Consequently, opportunities are slipping under the radar and being missed. We estimate that partners are losing a significant amount of rebate, perhaps up to $2 million per partner, per country, where the program is active.

Gaining a sufficient level of insight requires a lot of work, and a whole new method of tracking and understanding. Partners must truly understand the complexities of the program to fully reap the rewards and be able to project how much rebate they could earn. However, it is far from simple and does require a great deal of effort to actually start capitalizing on it. For partners who are already managing more programs than ever before this is no easy task and, since the program is quarterly, the opportunities are going to expire much quicker than they are able to build out their plans to start earning their incentives.

Keeping Partners Plugged into Customer Lifecycles

Since releasing our Lifecycle Incentives management module in Q4 2020, we have been asked if we can support more partners to help them understand the level of historical rebate that may have been available, and what they should do to secure future opportunities. Our goal is to enable partners to design and execute a successful customer experience practice that is unique to their business.

With our solution and advisory service, we can keep partners plugged into customer lifecycles; data insights, and best practices to enhance the value delivered to customers. We give partners comprehensive, real-time visibility of their Lifecycle Incentives benefits, and offer expert help to ensure they are making the most of the program, reducing the amount of time and internal resources required to manage it. In turn, we simply make doing business with Cisco more profitable. We have already demonstrated to partners the significant Lifecycle Incentives rebate and rewards that can be achieved.

Through conversations with our global partners, we have identified the top three most common challenges they are experiencing:

1) Understanding the level of opportunity and which opportunities they are eligible for.

2) Integrating those opportunities into the Lifecycle Incentives program and understanding exactly what steps are required to start receiving rebates.

3) Evolving the customer success team to improve their customer experience.

Providing a Roadmap for Channel Partners

 Our priority is to help our partners overcome 2 key challenges.  We provide a roadmap for the partners to follow, in order to make sure that they’re optimizing all of these different benefits and incentives that are available to them.  As part of our service, we undertake knowledge transfer helping them learn the program and how it evolves. Our reports allow partners to identify opportunities they never knew they were eligible for, put forward the data to Cisco, and earn rebates.

Growing a Customer Success Team with Lifecycle Incentives

Cisco encourages partners to develop their own customer experience success teams. However, the only way to develop such teams is through additional investment. With Lifecycle Incentives, we have opened up a revenue pathway to help partners grow their internal customer experience and success teams. Many of our partners who are benefiting from the rebate are now investing in their internal teams to help them grow. This means they can work on more opportunities and continue growing their rebate, so the knock-on effect is a huge win-win.

We hope we have helped shine a light on the huge rewards that are out there for Cisco’s partners through the Lifecycle Incentives program, along with the potential risks of neglecting lifecycle practices. To find out more, visit https://www.vortex6.com/lifecycle-practices/.