What is Channel Strategy?

Successful entrepreneurs experiment and master skills for managing channels and strategizing how to leverage them to increase sales and improve business. What do we mean by channel strategy? We’re referring to the channels that products or services travel through before they reach the end goal: the customer!

For example, we’re all familiar with a traditional channel from producer to retailer to customer. A common product like coffee is grown, processed, distributed, and is accessed by the consumer at the grocery store. Alternatively, online channels have revolutionized how customers find products. A coffee brand may sell to customers on Amazon, on social media accounts, through an e-commerce website…the possibilities are endless.

Photo Credit: httpss://static.pexels.com/photos/356042/pexels-photo-356042.jpeg

Channels are sometimes created through business-to-business marketing. A producer sells to a wholesaler, retailer, reseller and/or distributor. A franchise is another channel, in which the same products/services are delivered to customers by the franchisee. A direct channel is one in which the producer sells directly to the customer, either through e-commerce, mailers, catalogs, social media, a sales force, etc. An indirect channel is formed when multiple companies/businesses handle the product before it makes its way to the customer.

With a plethora of channel strategies to choose from and test, seasoned entrepreneurs know that their strategies have to be designed to appeal to the target market on the channel. You’ll need to answer questions like:

-How are you going to get your potential customers interested in purchasing your produce once they find it?

-Which channels are you going to focus most of your marketing efforts on?

-Will you sell through one channel or through multiple channels?

-Will you develop partnerships with other businesses to develop indirect marketing channels?

-How do you plan to manage ongoing partnerships and channel strategies?

A multi-channel strategy is becoming more common since modern consumers are likely to shop in-store as well as online. They may also be introduced to products through social media channels and digital advertising across the web. Some entrepreneurs define each social media platform as a separate channel for customers in different segments to access products/services. You may decide to market yourself on one or all of these social media websites:







Your marketing efforts on each channel must be optimized for the segment you are targeting. Customers in a retail store are going to have different needs and desires than customers surfing an e-commerce website. A shopper at an Old Navy store may decide to try on different options before purchasing clothes, whereas an online shopper might prefer to buy clothes from home without trying them on.

Compare both of these shoppers to Old Navy’s Instagram followers, who enjoy looking through the company’s Instagram posts to get creative ideas for which pieces to mix and match, how to wear the pieces, and the activities they may enjoy while wearing their new outfits. Old Navy and similar companies also include a link to their online store in the Instagram profile text.

Photo Credit: httpss://www.instagram.com/oldnavy/?hl=en

Photo Credit: httpss://www.instagram.com/oldnavy/?hl=en

To avoid conflict however, channels must work together effectively to provide a memorable and satisfying experience for customers. The automobile industry has done an excellent job of managing multiple channels. Customers can shop for a car online and place their purchase order. They will then pick up the car at a local dealer in their area. They’ll still be able to take the car to the dealer for maintenance and repairs.

Photo Credit: httpss://www.denver.buyatoyota.com/en/offers/corolla/

Don’t forget bloggers and influencers as another channel where potential customers will find your products/services. Apartment Therapy presented an example in the blog post 30 Home Finds Under $50 From a New Best-of-Amazon Curation Site. Apartment Therapy is a popular home décor and home organization content producer. By publishing this blog post, Apartment Therapy is directing potential customers to another website, titled Canopy. Apartment Therapy’s readers may decide to try using Canopy, a website where they can find products on Amazon that have been curated. As Canopy states, “We bring boutique curation to the Internet’s largest catalog.” As a result, Amazon will see increased purchases and the target market on Canopy will enjoy a unique shopping experience.

Whichever channel strategy you use, always analyze your efforts through measurable goals. Find out what works and leverage that success to improve your channel strategy.

Square 1 Group is a web development firm that creates beautiful and efficient websites for our multi-screened world. Put your best foot forward by allowing us to design usable websites (on both desktop and mobile) that will provide sophisticated presentation and help customers find you and your services. Contact us today to discuss website development, social media marketing, content creation, and more.

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