This document discusses managing distribution channels, which is one of the four Ps of marketing. It explains that distribution channels play a key role in marketing strategy by helping expand a company's reach to penetrate its market. The document provides an overview of different types of distribution channels companies can use, including direct sales, dealers/resellers, e-commerce, and more. It also discusses factors to consider when evaluating distribution channels, such as how customers prefer to buy and any customization or support needs.

1. Managing
distribution
channels
Vasiliy Starostin
Materials from
www.marketingmo.com

2. Distribu(on,
also
known
as
placement,
is
one
of
the
classic
“4
Ps”
of
marke(ng
mix
Distribu(on
channels
play
one
of
the
key
role
in
your
en(re
marke(ng
strategy
—
they
help
you
expand
your
reach
to
penetrate
your
market.
*Цикл
товародвижения
по
всем
этапам
PLC
2
Распределение
Производство
Сырье,
материалы,
компоненты

3. Evaluate
how
your
end-­‐users
need
to
buy
Your
distribu(on
strategy
should
deliver
the
informa(on
and
service
your
prospects
need.
For
each
customer
segment,
consider:
How
and
where
they
prefer
to
buy
Whether
your
product
needs
to
be
serviced
Whether
your
product
needs
to
be
customized
or
installed
Whether
they
need
personalized
educa(on
and
training
Whether
they
need
addi(onal
products
or
services
to
be
used
along
with
yours
3

4. B2B
and
B2C
companies
can
sell
through
a
single
channel
or
through
mul(ple
channels
that
may
include:
• Selling
through
your
own
e-­‐
commerce
website.
Direct/
Internet
• One
or
more
sales
teams
that
you
employ
directly.
You
may
use
mul(ple
teams
that
specialize
in
different
products
or
customer
segments.
Direct/Sales
Team
• Selling
through
your
own
catalog.
Direct
Catalog
• Retailers
sell
directly
to
end-­‐
users
via
a
physical
store,
a
website
or
a
catalog.
Retail
• A
company
that
buys
products
in
bulk
from
many
manufacturers
and
then
resells
smaller
volumes
to
resellers
or
retailers.
Wholesaler/
Distributor
• A
VAR
works
with
end-­‐users
to
provide
custom
solu(ons
that
may
include
mul(ple
products
and
services
from
different
manufacturers.
Value-­‐Added
Reseller
• A
consultant
develops
rela(onships
with
companies
and
provides
various
types
of
services;
they
may
recommend
a
manufacturer’s
product
or
simply
purchase
it
to
deliver
a
solu(on
to
their
client.
Consultant
• A
company
or
person
who
buys
inventory
from
either
a
manufacturer
or
a
distributor,
then
resells
it
to
an
end-­‐user.
Dealer
• You
can
outsource
your
sales
func(on
to
a
company
that
sells
different
manufacturers’
products
to
a
group
of
similar
customers
in
a
specific
territory.
Sales
Agent
4

5. DIRECT
TO
END
USERS
SELL
THROUGH
A
DEALER
NETWORK
SELL
THROUGH
A
VAR
(VALUE-­‐ADDED
RESELLER
You
have
a
sales
team
that
sells
directly
to
Fortune
100
companies.
You
have
a
second
product
line
for
small
businesses.
Instead
of
using
your
sales
team,
you
sell
this
line
directly
to
end-­‐users
through
your
website
and
marke(ng
campaigns.
You
have
two
markets
and
two
distribu(on
channels.
You
sell
a
product
through
a
geographical
network
of
dealers
who
sell
to
end-­‐users
in
their
areas.
The
dealers
may
service
the
product
as
well.
Your
dealers
are
essen(ally
your
customers,
and
you
have
a
strong
program
to
train
and
support
them
with
marke(ng
campaigns
and
materials.
You
sell
a
product
to
a
company
who
bundles
it
with
services
or
other
products
and
resells
it.
That
company
is
called
a
Value
Added
Reseller
(VAR)
because
it
adds
value
to
your
product.
A
VAR
may
work
with
an
end-­‐
user
to
determine
the
right
products
and
configura(ons,
and
then
implement
a
system
that
includes
your
product.
5

6. 6

7. Ques(ons
to
consider
1. If
users
need
personalized
service,
you
can
u(lize
a
local
dealer
network
or
reseller
program
to
provide
that
service.
2. If
your
users
prefer
to
buy
online,
you
can
create
an
e-­‐commerce
website
and
fulfillment
system
and
sell
direct;
you
can
also
sell
to
another
online
retailer
or
distributor
that
can
offer
your
product
on
their
own
sites.
3. You
can
build
your
own
specialized
sales
team
to
prospect
and
close
deals
directly
with
customers.
7

8. 8

9. Before
you
begin
1. Your
distribu(on
channels
should
support
your
posi(oning
and
brand
strategy.
– You
are
a
selling
value-­‐added
product
– So}ware
vendor
2. It’s
especially
important
to
think
about
distribu(on
when
you’re
going
a}er
a
new
customer
segment,
releasing
a
new
product,
or
looking
for
ways
to
aggressively
grow
your
business.
9

10. Minimize
pricing
conflicts
Mul(ple
channels
• Carefully
map
out
the
price
for
each
step
in
your
channel
and
include
a
fair
profit
for
each
type
of
partner.
• Then
compare
the
price
that
the
end-­‐user
will
pay;
if
a
customer
can
buy
from
one
channel
at
a
lower
price
than
from
another,
your
partners
will
righ€ully
have
concerns.
• Pricing
conflict
is
common,
and
it
can
jeopardize
your
en(re
strategy,
so
do
your
best
to
map
out
the
price
at
each
step
and
develop
the
best
solu(on
possible.
10

11. 11