Pax8’s “Loyalty” scheme becomes first to aggregate tiered benefits across 140+ marketplace vendors prompting a shake up for the legacy partner programme model
Although officially launching on November 4th, marketplace pioneer Pax8 has announced details of its Voyager Alliance “marketplace experience” that could radically change how MSPs gain value from the traditional partner program.
“We launched this as a partner program, and the reason we use these words is that MSPs understand what partner programs are, but it's not a partner program,” says Phylip Morgan, Chief Revenue Officer for Pax8 in EMEA. “This is focused on a partner experience. For myself [and many others on our team who have run MSPs], what we don't need is another partner program, right?”
Morgan outlines a scenario where an MSP working with eight vendors must navigate multiple accreditation and program requirements that are constantly changing, creating hurdles in delivering a consistent vendor engagement experience. “What we definitely don't need is another programmatic approach to the industry,” says Morgan. “Instead, what we need to focus on is the user experience, the customer experience, or in our case, the partner experience.”
The new Voyager Alliance structure is based on five tiers. Every new partner joins as an Alliance member and can progress through run-rate revenue bands starting at over €500 for the Ignite tier, €2,250 for Velocity, and stepping up through various increments to Titan and Galactic levels, with the latter requiring €90,000 in monthly recurring revenue (RR).
At each tier, partners unlock rewards and potential loyalty points, which can be spent on various benefits such as training, events, professional services support, and other elements. While Morgan wouldn't confirm whether this would include marketing development funds (MDF), it seems likely at the mid to higher tiers.
One crucial difference from traditional partner programs is that higher-tier partners in the Voyager Alliance do not receive discounts on pricing. “Most of the partners that come to us every single day and join the Pax8 marketplace do so because of the way we help them grow their business, gain efficiencies, and manage risks. Few partners say, ‘I'm coming to you because you can save me 2% or 3% on this or that.’ That’s not the value we add to an MSP's business.”
Morgan also notes that no legacy distributor has taken this approach of aggregating benefits across multiple vendors, but he emphasizes that although it is marketed as a partner program, it is far closer to a B2B loyalty scheme. Pax8 will announce more details about the program on November 4th, including the list of benefits and where its 30,000+ partners will initially sit within the structure.
IT Europa Analysis
Pax8 is a disruptor, and like its peers, it has tried to craft language to define a concept that could be quite revolutionary. From this journalist’s simplistic perspective, this is a loyalty scheme that benefits partners running transactions through Pax8, irrespective of the vendor. It seems like a logical step for a distributor (or marketplace, in Pax8’s terms) to take. Collectively, I’ve asked journalist colleagues if they can think of any marketplace (or legacy distributor) who has done this before, and none spring to mind.
Why is this radical? Imagine the scenario of a mid-sized MSP that works with 20 or so vendors but doesn’t have enough run-rate with any single vendor to become a “Gold” or “Elite” partner and qualify for the associated benefits of those individual partner programs. Under the Pax8 model, the aggregate €20k of monthly spend might qualify it as a “Titan” level partner, unlocking a range of perks.
The devil is in the details. What are the benefits? How many can I access? Are these perks freebies or offered at a discounted rate? While those specifics remain to be seen, conceptually, this is a good deal for all transacting partners. It may prompt some to abandon vendor partner programs where they don’t accrue benefits and instead channel transactions through Pax8.
Pax8 may be the first to introduce this model, but it seems such a good idea that they are unlikely to be the last! For MSPs, especially smaller ones, the benefits of a marketplace model that streamlines transactional processes just got a cherry on top.
