What’s the Best Channel Strategy for Your Brand?

Start with Online Channel Strategy

With many consumers expecting to start their initial investigation and shopping online, brands have little choice but to invest in an online channel strategy. And, even for a small business, keeping a mobile app and website current may require ongoing maintenance and upgrades of around $2500/month or $30,000 per year (not counting the initial investment).  Of course, the investment can be far more than that.

That’s why one of the experts whose worked recently with our Vistage CEO group, Ark Rozental, has called the app or mobile website “your best salesperson” and urged a focus on conversions, in addition to visits, to capitalize on this investment.     

The question comes as to whether putting additional investment into the online channel is the best choice for your brand.

Channel Choices, Category and Channel Needs

Depending on the category, the complexity of the decision, and the preferences of the customer, the customer may want to shop in store, meet in person with an experienced salesperson, consult with someone on the phone, or complete the entire purchase process online.

  A starting set of channels might include some of these many options:

  • Distributor: Company focuses on distributor who then reaches end customer
  • Retail stores: Company branded
  • Retail stores: Multi-brand, mass merchandisers, department stores
  • Other types of retailers: B2B stores, convenience stores, dollar stores, warehouse clubs, etc.
  • Kiosks/vending machines: Company branded or multi brand
  • Online through Amazon: Currently capturing majority of ecommerce in many categories
  • Online: App and/or website
  • Online: Brand aggregator/comparison shopping
  • Other types of online
  • Outside sales, direct to consumer/customer: Employees on company salary visit in-home or at the place of business (e.g., home repair/improvement)
  • Outside sales, direct to consumer/customer: Not employees, run their own business but dedicated to the one brand
  • Inside sales, direct to consumer/customer: Outbound phone and inbound phone call/service center
  • Manufacturer’s reps: An independent sales representative who represents multiple organizations and sells to retailers or wholesalers
  • Brokers: An independent sales representative who sells directly to end customers (e.g., insurance brokers that represent multiple organizations)
  • Direct to consumer/customer: Direct mail and catalog
  • Other channel choices
What’s the Best Channel Strategy for Your Brand?

Customer Journey: A Disciplined Approach to Channel Strategy

A foundational step for many brands is to map the customer journey, with all the touchpoints and pain points. This journey is doing by starting with a customer persona(s), and relevant insights about that customer including his or her goals.  Customer journey mapping should involve customer research and validation, but some companies choose to rely on hypotheses of the management team, given limited resources or a lack of commitment to understanding.   

With this understanding in place, the company needs to make channel choices and prioritize resources. Our AAA Channel Strategy Case Study showed the six factors that go into narrowing down channels.  

For many, offering a seamless, omni-channel experience that delivers the ideal experience is not realistic. From my non-comprehensive list above of 15 channel options, it would be unsustainable to choose every channel. For instance, I’ve noticed several app-dominant players have eliminated website functionality and require the user to use an app. That may be because the app does certain things better than the website, such as branding and the ability to work faster, but cost to maintain both likely plays a role as well.  

What’s the Best Channel Strategy for Your Brand?

Making Channel Strategy Choices: Consider Channel Conflict

While there may be multiple approaches that meet the customer’s needs, the company must think through the alternatives. Otherwise, it can create channel conflict, leading to unintended consequences, particularly when the channels are a mix of company/brand owned and non-company/brand owned.

One organization I admire has chosen to stay committed to its sales representatives who are independent business owners representing just the one brand. This company also meets its customer’s needs with online, app and phone options, but always makes sure the primary channel (in their case the independent sales representative) is supported, and the primary focus. This is a very different strategy from one of its close competitors, who has deliberately promoted channel conflict. 

Another company I admire is 100% ecommerce, selling directly to hobbyist end users, industrial customers and distributors.  After careful consideration, market research and insights work, this firm has selected distributors as its primary channel.  Making this strategic choice led to clarity in the focus of product development, marketing and sales. The distributors will provide the customized support that larger industrial customers require, and the company will eliminate those costs. A distributor council and business best practices for distributors is being created.

As shown, the best channel strategy for your brand depends on several factors and requires careful decision-making. Deciding which channels to eliminate is as important as selecting the channels to prioritize. Contact us to see how the channel strategy experts at Insight to Action can help your brand make strategic channel choices.

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