Xero’s partner program will be overhauled to address bookkeepers’ complaints of licence poaching by accountants, Chris Ridd, Xero managing director for Australia, announced last Wednesday.
Xero partners who achieved gold status or higher received a larger margin from the monthly Xero subscription and were positioned at the front of Xero’s online partner directory which received high numbers of sales inquiries. The current program encouraged partners to accumulate more licences so they ranked higher in the directory than others in the same bracket.
“It’s been an interesting year managing partners with predatory behaviour,” Ridd told Digital First.
The new program, likely to launch in August, would reduce the emphasis on the number of registered clients and focus on on-going training and certification, attendance at Xero events and other factors.
Speaking at Xero’s Sydney roadshow last week, Ridd said Xero management had been surprised when a bookkeeper at last year’s annual conference recounted how an accountant had asked mutual clients to make him the registered partner on their Xero accounts.
“It was an awkward moment. The bookkeeper was pretty much in tears, and she put up her hand and said ‘I had an accountant steal my clients and I’ve dropped back to bronze’,” Ridd told the audience.
Xero’s CEO Rod Drury was “pretty upset” by the incident, Ridd told Digital First later. “Rod said, ‘We just got smashed on stage’.”
The existing program also lacked incentives for partners on silver or gold to develop their relationship with Xero, Ridd said.
“Every now and then a partner gets to a certain level and they might have staff leave and they don’t recertify or they stop coming to events and that’s a problem for us,” Ridd said. “You could be gold (status) and own 120 organisations and be on the top of the directory and do nothing else. That’s not fair for a bookkeeper who is doing a whole lot more.”
Xero was designing a rewards program similar to a frequent flyer loyalty scheme with the focus on constant engagement rather than hitting sales targets, Ridd said.
The new points based system would reward commitment to Xero. If a client or another adviser invited a partner into a Xero account they would receive points. “It suggests you’re good at what you do,” Ridd said.
Partners would also receive points for the number staff certified on Xero and for attending events.
“The important message is that size is not everything. If I never want to manage 25 clients, but I’m committed and I’m on the journey, then I want a reward for that. Hopefully that can still get you silver” status, Ridd said.
Accountants and bookkeepers that were passionate and engaged with Xero were likelier to have happier clients who would stay with the Xero accounting platform. “If their clients are happier, they stick. That’s a better partner,” Ridd said. “It’s all about loyalty and stickiness, driving down our churn buy having more committed partners.”