Monogamy in the Marketing Marketplace

The relationships companies build with partners can be just as mission-critical as the ones built with customers — and just as fragile, as Jeff Pedowitz and Bruce Culbert recently discovered.

After months of trying to salvage the relationship between their company, The Pedowitz Group (TPG), a provider of demand generation and marketing services, and marketing automation solution provider Eloqua, Pedowitz and Culbert say the two firms had to call it quits.

"It came down to a diverging of interests," says Pedowitz, TPG's president and chief executive officer. The final straw? According to Pedowitz, the tipping point was Eloqua's insistence that TPG commit to selling no marketing solution other than Eloqua's. The agency declined, putting an end to a long-term partnership in which TPG had become Eloqua's top channel-distribution partner. A TPG statement released after the break-up noted that "at the 2009 Eloqua Partner Summit, TPG was recognized as Eloqua's top revenue provider and ranked highest in customer service among the company's 40+ partners."

How could a successful arrangement fall apart so completely?

"Eloqua originally came to us out of concern that we were working with some of their competitors in the marketplace," Pedowitz explains. "They wanted all partners to be exclusive. Gutturally, we felt it was not the right thing for our customers.  It was a tough decision, but we have to stand our ground and we have got to stay true to what we are about, focusing on customers — their issues, their challenges, and their opportunities. And that means providing them with the best solution that we can harness from the industry."

Prior to the falling out, TPG had been a top channel partner with Eloqua, but also a top-tier partner with marketing software provider Marketo and a number-two partner of marketing automation company Genius.com. According to a recent blogpost ("Changes in the Channel") written by Rob Brewster, the Eloqua executive responsible for driving the growth of the company's partner business, Eloqua determined that a close relationship between TPG and competitors posed a threat to Eloqua's intellectual property.

"Over the last year," Brewster writes in the post, "TPG undertook a strategy to be an agency that represents multiple competing brands in our space. This approach is inconsistent with our vision for Eloqua’s channel because we are concerned about sharing our intellectual property (IP) with any company that works closely with our competitors."

"We have different types of partners — resellers, systems integrators, etc. — and our strong preference for exclusivity applies only to one type: resellers specializing in demand-generation space," clarifies Joe Chernov, director of content marketing for Eloqua, in an email. "The Pedowitz Group falls into that category."

Chernov also notes in his email that Eloqua plans to ask other resellers in the demand-generation space to agree to the same terms that TPG declined. "They know this is a priority of ours," he writes. TPG executives, however, say they have spoken to Eloqua partners with similar business models and have yet to hear of another firm facing the same ultimatum.

"Apparently," Pedowitz says, "we are the only ones."

[Continued on next page]

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