The channel strategy includes all decisions on design and management of the different sales channels of a supplier. The strategy needs to answer the following four questions:
Which (additional) sales channels should be used?
The answer to the first question is based on the results of customer and competitor analyses as well as on the defined objectives. The current design of the sales channels needs to be in line with customer needs and corporate goals.
What should the (additional) distribution channels be used for?
To answer this question, it is necessary to determine the functions of each channel and the market segments each channel serves.
How can the sales channels be coordinated?
Regarding the third question, it is necessary to specify the management and coordination of the different sales channels in order to ensure a smooth sales process and to avoid conflicts.
How can sales success be measured in the respective channel?
The fourth question relates to the regular monitoring of distribution channels. In our opinion, this last question is neglected by many companies who have established additional sales channels in recent years. In quite a few cases, the efficiency of a multichannel system could be increased further by an expansion of the newly implemented channels, given that this expansion is driven forward systematically.