February 23, 2023

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In her Supernode 2022 fireside chat, General Partner at Andreessen Horowitz Sarah Wang shared why it’s necessary for companies to have strong partner programs in order to weather economic storms.

“Partnerships are more important than ever. Specifically, because you are bringing in pipeline, shortening sales cycles, and increasing conversion rates,” she shared. “Partnerships are a ‘need to have’, not a ‘nice to have’, especially in this environment.”

This kind of partnerships-forward strategy that Wang referred to is also called ecosystem-led growth (ELG). ELG is the acceleration of customer acquisition, account expansion, and access to new markets using partners and partner data to power go-to-market (GTM) motions. For example, a company using ELG might use partner data to help their sales team close deals faster and at a higher conversion rate via ecosystem-led sales.

Companies who are either on the fence about leaning into ELG or unsure of where to start, this article is for you. We’re covering:

The rise in popularity of sharing partner data securely combined with changes in privacy laws has created conditions for ELG to become a predominant business strategy for tech companies. Here’s why.

How many tech companies are actually using ELG today? How has that number changed in the past few years? To find out, we’ve calculated the ratio of the total number of tech companies using ELG out of all of the tech companies in the world with existing partner programs.

Starting in January 2020, we took the total number of companies in Partnerbase, a database that tracks every company worldwide with a partner program of some kind, and made that the denominator in our ratio. Then, we pulled the number of companies sharing account level partner data on Crossbeam from the same time range and made that the numerator. What we found was that the number of companies using ELG is growing exponentially.

As we’ve interviewed partnership leaders, CMOs, CEOs, and other GTM professionals who use ELG, we have seen (and recorded) firsthand how they’ve increased revenue for their companies. Some examples:

The way companies can legally buy and sell data is changing; third-party data is getting more difficult to acquire and second party data (including partner data) will have to take its place if companies expect to generate high quality leads and personalize sales and marketing outreach.

In its “Next In Personalization” 2021 report, McKinsey & Company found that 71% of respondents “expect personalization” from brands and businesses and 76% “get frustrated” when this expectation is unmet. Simultaneously, companies like Apple and Google are proactively responding to changes in third-party data laws. This has included Google announcing a 2023 ban on the use of third-party cookies on its Chrome browser and ad networks.

As the supply of third party customer data dwindles, a company’s commitment to sharing data with partners will most likely become increasingly valuable. For example:

74% of companies implementing ELG use a partner ecosystem platform (PEP). PEPs helps companies securely share data with their partners and drive ecosystem-led growth.

A PEP connects directly to your data source, such as your customer relationship management (CRM) system or CSV file, and surfaces overlaps between your data and your partner’s data. For example: If you have a high amount of customers in common with your partner, this is a signal that you should develop an integration to help your mutual customers get more value from your products.

The fastest way to know where you and your partner should invest in a potential partnership is by real-time account mapping using a PEP. . (We’ll get to the most common types of overlaps and how to use them in a bit!)

PEP usage continues to trend upward among US and European companies (with a 16% increase in the US since 2022!). In a volatile economic climate where 31% of respondents reported reductions in their SaaS spending,
PEPs are growing in popularity. Future Market Insights reported that the PEP industry will reach a $201.6B value by 2032.

Because PEPs are the tools that enable partner data sharing (the very backbone of ELG) they are an integral part of ELG-led companies’ tech stacks. Partner data bolsters the success of every GTM team and can power their respective tech stacks.

You can integrate your PEP with the existing tools in your tech stack, helping your GTM teams generate leads, close deals, and retain more customers at scale.. For example, Crossbeam integrates with:

You realize the importance of a PEP and you sign up for Crossbeam… Now what? We took a look at our product data to surface the most common actions that our customers take. This is a great place to kick off your PEP journey and can make sure you’re taking advantage of the easy wins that can help you prove value faster to your higher-ups.

When you map accounts with your partners in Crossbeam, you get to see nine “standard” overlap types (not including custom populations created by users). Here are the top three most common overlap reports that our users create (and their corresponding use cases) to make identifying your first three PEP plays easy.

The customers <> customers overlap identifies the group of people who will benefit from an integration between your product and your partner’s product. If you are considering building an integration with a partner, a high customer <> customer overlap count is a major green flag.

Instead of asking your higher-ups to invest time and resources into building an integration based on good faith, show them the amount of customers you have in common. The overlap data will show just how many people are eligible to adopt the integration immediately. (Plus, you can add that integration users are 58% less likely to churn than non-integration users.)

Once you’ve built the integration, your customers <> customers overlap list becomes your target group of early adopters. Your marketing team can create co-marketing motions such as a webinar or joint blog posts explaining the new integration to potential adopters.

Customers <> customers overlaps are also a good indicator of the overall health of a potential partnership. Having shared customers shows that you and your partner have a similar ideal customer profile (ICP). This is a signal that you’re likely to have overlaps between your prospects and opportunities as well. And mapping accounts between these populations will give you proof in seconds.

Read:
How Bynder doubled the size of their tech ecosystem in just six months with ELG

Having a prospect who’s already an existing customer of your partner’s is kind of like knowing someone who already works at the company you’re applying to: having someone on the inside who can put in a good word can go a long way in helping you stand out from your competition.

When you surface prospects <> customers overlaps, you’re identifying a group of accounts (and AEs) that can benefit from a warm intro. Warm intros help show that your partner trusts you and your product aligns with theirs. This can reduce the time between initial outreach and the prospect booking their first sales call. This is what we call ecosystem-led sales.

To get started, we recommend working with your
AE to create:

Read:
8 times sales reps won the deal by co-selling with partners.

As The Beatles once sang, we get by with a little help from our friends (or in this case, partners). When a deal stalls, an AE is ghosted, or they need more support pushing the deal across the finish line, a partner can help.

For example:

• Plus, they can educate the opportunity about the value of your product or integration during their sales conversations and onboarding with new customers.
  

For your opportunities <> customers overlaps, we recommend:

Read: How an AE at SEO platform Botify went from being ghosted by an opportunity to closing the deal just two weeks later, thanks to a partner.