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Market Development Funds--The Current State

2023 is starting out as a challenging year for the larger technology companies--meaning the budgets for market development funds (MDF) are tighter. It's just part of the technology industry landscape--there are expansion years and contraction years. Although 2023 is starting out as a contraction year, it may not end that way. Despite all this, MDF money is available--for the right partner with the right market and creative campaign ideas. Always bear in mind that the endgame for MDF (market development funds) is at least lead generation and, depending on the channel partner, also sales. Think like the MDF provider.

A vendor will offer MDF funds to channel partners before any sale has taken place. MDF money is essentially a marketing incentive. MDF is offered to select partners based on the specific needs of the vendor and the proven and potential for success of the partner. For example, the vendor may be looking to increase sales for a specific solution or a specific vertical where the channel partner successfully plays. Expectations are discussed and campaign plans are submitted for approval beforehand. Detailed results reporting is also required prior to fund disbursement by most vendors.

How Partners can Secure a Share of the Money that is Available

Despite the current contraction, most major technology companies have set aside money for partner campaigns this year-though generally not as much as other years. This shouldn't keep you from applying for funds as long as you tamp down expectations.

Showing commitment to the vendor helps in the quest for marketing money. Partners need to demonstrate proficiency in the vendor's product or service and possess the relevant technical certifications. They also need to demonstrate that they can sell the vendor's offering. Beyond that it’s really about organization and mastering the process. Show good faith. This means making things as easy as possible for the vendor's rep. Follow the rules!

Steps for Applying for MDF Money

1. Get organized: Assemble all program materials into one folder.

2. Master the MDF portal: Assuming there is one, note usability issues and questions.

3. Get clear direction from the vendor rep: Take notes during conversations and save emails.

4. Ask for a sample: Ask for one or more samples of a successful MDF request—this saves time and frustration.

5. Create a list of application steps: Run this by the rep for feedback.

6. Create an initial request: Expect that there are going to be multiple modifications before it is accepted. The goal is to avoid making the same mistake twice.

As long as you can show results -- and show what you are using the money for – many vendors will continue to be willing to invest. Your goal in 2023 is to find a creative way to use every dime of MDF that is available.


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