Tips For Selecting Your Market Channels


In the not so distant past, companies designed their marketing channels (or go-to-market networks and mechanisms) in a very simple and straightforward way. They sold their products directly to all customers in the one way. Such a ‘one size fits all’ channel strategy is no longer tenable in today’s fragmented markets and customer multi-segments. Here are tips for selecting your marketing channels:

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Marketing Channels

Marketing channels perform a number of key tasks for a company. These can be generically categorized as:

1. Demand Generation 

The mechanisms by which a company or possibly a collaborator / partner generates a lead, qualifies that lead (suspect to prospect) and undertakes pre-sale, persuasion of prospective customers. Mechanisms may be advertising, sales force or a retail partner.

2. Demand Fulfilment 

How an order for the product is taken. How the product is delivered. How the product is installed or used. There may be a third party delivery partner, for example.

3. After-Sale Service 

The ongoing service.

4. Account Management 

Future or additional product sales to the customer.

Recommended reading: How To Do a Market Segmentation Strategy For Your Startup

Channel Selection

For each of the four ‘channel’ tasks, there are a number of options to be considered by a company, having regard to (1) customer needs and requirements (2) the way the industry operates in a market and (3) the company’s own objectives for competitiveness and effectiveness.

In the start up and emerging stages, the entrepreneur has limited (time, personnel and financial) resources and it is often best to select a limited number of channels that offer:

1. Greatest ease of market segment entry

You need to be able to enter the market quickly and against the competition

2. Known distribution

Distribution methods and dynamics that are understood/previously experienced by your management.

3. Lowest cost of entry

Compared to the competition.

4. Best fit with brand and product positioning

For example “complex” products will need dedicated sellers or re-sellers that really know the product/service. 

5. Least financial risk

You don't want to invest heavily in a channel that fails to deliver. 

6. Strategic commitment

Channels where you can make a strategic commitment to the distribution of your product or service. 

7. Likely to be permanent

Switching marketing channels all the time can be costly as you get up and running again. 

8. Sufficient volume potential

You want to be able to reach immediate and short-term revenue and profit goals

9. Alternative routes to market

Should one lapse or cease producing business.

10. Significant level of control in at least one channel

To ensure you can communicate fully your product positioning (USP) and can keep the end customer knowledgeable at all times to evolve and develop that positioning.

Recommended reading: How To Go About Market Opportunity Analysis

Over to you now. How did you go about selecting your marketing channels? Tell us in the comments below. 

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