Zero Tier Distribution® enables a cost-effective, personal, sales-and-service partnership between new technology innovators and enterprise customers, ultimately creating a ‘win-win’ scenario for both. Enterprises have access to the best, cutting-edge technology, and the innovators of the technology gain sales access to the enterprise market.
BENEFITING FROM ZERO-TIER DISTRIBUTION®
Good distribution maintains three important attributes: it creates a greatly magnified sales force, its broad, and its cheap.
In recent years product pricing has evolved from a purchase model to a pay-per-use model. This has changed the nature of being a supplier – everything is essentially treated as a service and services are paid for with recurring, small fees.
The downside for a vendor is that a bunch of strung out little checks do not compensate for one great big one up-front. It does not matter if the deliverable is an actual service or not. Physical products are being “sold” this way as well. A great example is zipcar.com. The use of any conceivable car is available to you on demand and you do not pay a cent unless you actually use one.
The upside of receiving several smaller checks is that they never stop coming (presuming the customer remains happy) as customers continue to pay you forever. Over time, this is a great business model for vendors. However, in the short term, it can be financially challenging.
MTP maintains a sizable field of independent experts we term “associates”, and we unite them under the processes we term “zero-tier distribution®”. In the past distribution referred to the use of resellers. Multiple tiers referred to multiple resellers selling through each other to facilitate product stocking and distribute products across geographic areas. Tiers of resellers are also expensive; everyone takes their cut. Zero-tier distribution* eliminates these costs.
Beyond external reseller tiers, the most precious resource a company may deploy is an outside sales force. It is this organization that can most quickly drain a new technology company of its cash. Outside sales forces, ones that personally meet customers, are evolving to a minimal but very effective force, except in the most complex of environments. Yet, customers still say they prefer to actually and routinely meet the suppliers of their critical technology. Zero-tier distribution+ augments and magnifies the effects of a minimally sized, yet expert, outside sales force. MTP associates support effective and qualified customer meetings, while using corporate outside sales force as the equivalent of the nuclear option. They spend time with the most precious or difficult accounts.
The zero-tier distribution® idea expands on prior work improved upon by countless companies as is described by David Skok here. While over-simplifying things, we have essentially implemented inside and outside sales combining and unifying well-trained, but non-affiliated associates. These associates sell our client products and provide excellent services to our enterprise accounts. Zero-tier distribution® is most effective when combined with powerful inbound-marketing programs, a clear value-proposition, and accompanied by effective messaging.
One reason zero-tier distribution® works is that it is primarily used to sell products that are in the explosive growth phase; that is, customers already understand the principles behind the products. It makes extensive use of inbound marketing, and results we have ample eager customers calling associates who then often operate in the fulfillment and customer satisfaction mode. Access to highly-qualified associates has been recently amplified by substantial reductions-in-force in the technology sector.
Using Zero-Tier Distribution® before explosive growth
We make two exceptions to our standing practice that the MTP associates only sell products people urgently want to buy. First, when a supplier has found product-market fit and is in the ramp phase (and refining its business model) they may use associates to sell at a progressively increasing intensity to validate their business model. Second, we use the associates to judiciously help our clients searching for product-market fit to test their hypotheses. We can bring 50 validating prospects to a technology innovator in the time it takes the company’s native sales force to acquire just one.
The MTP associates are a formidable force of over 100+ people using a this powerful methodology. They bring economic health to market entrants which may be adversely impacted by low-payment, recurring revenue business models.