Share, , Google Plus, Pinterest,

Posted in:

Sales channels: which one is the best for you?

Do you know which sales channels will be best for you? Sales channels are those avenues which you use to get your product into the hands of your customers. They can be indirect or direct channels. Direct channels are ones where you have more control on how your brand is displayed and you have direct contact with your customers. Indirect channels are ones where you make a sale through an intermediary. But which one is the best for you?

Before you decide on which sales channel to use, you need to answer some questions about your product:

  1. What are you selling? Is it a high-end product where you need to build a rapport with your clients or do you have a product which people are keen to buy online?
  2. How do you receive payments for your products?
  3. How many products do people buy at a time?
  4. How long do your clients like to wait to get their product?
  5. Where are you customers located?
  6. What products complement your product?

When you have answered these questions you can decide which sales channels to use:

Direct sales channels are:

  1. Retail
    This is a brick and mortar shop with salespeople. This is the most expensive option for your business. It is great for high-end products or products where you need to demo how it works or you need to develop a rapport with your client for them to buy from you. It is also great for products which have detailed information about their benefits.
  2. Trade shows or exhibitions
    This would be a good investment because you may meet people outside of your area of influence. You could also access those people who may not be internet savvy. By attending a trade show, you can speak directly to your customers and find out what their pain points are and how you can solve them. Furthermore, you could see what your competition is doing and see if there are other products which you could partner with.
  3. Bids or tenders
    These are very important if you want to get a deal with the public sector. It is important to do some research about how long it will take to prepare the bid, the chances of winning the contract and the value of the contract before you decide to bid. When you have this information you will be able to make an informed decision about whether to bid for it or not.
  4. An online store
    This is a store which is built into your website. You can sell your products directly to your clients and you would direct your clients to your products through the use of social media marketing.

Indirect sales channels are:

  1. Resellers
    This is a company who buys your product and then sells it for you through their channels.
  2. Affiliates
    These are people or companies who sell your product for you for a commission. A caution when dealing with affiliates is you need to make sure they don’t participate in fraudulent behaviour as this could have a bad impact on your brand. Research the affiliates before you allow them to promote and sell your product. The advantage of using an affiliate is that it will be word-of-mouth advertising to a group of people you may not have considered approaching.
  3. Online marketplaces
    There is a great variety of online marketplaces which offer different kinds of benefits and challenges for your products. It is important to choose an online sales channel which will complement your product.
  4. Distributors
    These are companies which buy your product wholesale and then distribute them through channels that they are associated with. The benefits of using a distributor is that you will not have to train up a sales force to sell your product. A limitation is that the mark-up on the goods may not be good for low-value products.

It is important no matter which channel you chose to always evaluate the channel and ensure that they are adding to your sales. You should also make sure that channels are not taking customers away from other channels which you use to make sales.

Proudly brought to you by the NSBC.