What is Channel Marketing? An Expert Guide for the Beginners.

We all know that in order to complete a task we often require assistance or some medium to finish the task from beginning till the end. This medium can be in the form of things, a helping hand etc. Channel marketing is somewhat a similar concept to this. So let’s have a look on what is channel marketing and how it works.

WHAT IS CHANNEL MARKETING?

Channel marketing is the process of distributing a product or service from beginning till the end. Now anything that comes in between is a channel in layman’s language. Thus this process can consist of people, activities and multiple other companies or organizations that are a part of this process of sending goods from the manufacturer to consumers.

Let’s look at an example to have a clear understanding about what channel marketing is?

Imagine that you are eating a biscuit from a biscuit packet. How did you get your hands on that packet?

It starts in the wheat field and then it goes to the grinding factory where those biscuits are made, then it will go to a factory where packaging of biscuits is done. With the help of a transportation facility, the biscuits packets are then sent in the market for sale where they are finally purchased.

In the above example everything including the grinding factory, packaging factory, transportation facility, salesman etc. are channels or mediums engaged in the final consumption of the product. Thus, everything from wheat fields till the consumer is a part of channel marketing.

A careful look at the above example will help you understand the fact that the main motive of a marketing channel is to create a link between the organization that has actually created the product or service and the customers who want to avail those products and services.

The channel marketing includes channel partners that help your product in reaching the audience. These channel partners can include people like;

• Distributors
• Resellers
• Retailers
• Affiliates
• Agents
• Other third parties

HOW DOES CHANNEL MARKETING ACTUALLY WORKS?

The basic idea behind channel marketing is that you depend on several other sources to reach your audience which means the deals are mutually beneficial for all the parties involved. It’s basically the mutually beneficial relationship between you and your channel marketing partners that keep your channel marketing chain intact.

Obviously it’s not just one channel involved in the process, there are multiple other channels too. Which typically means you have multiple businesses who are engaged in the process of selling a single product.

It’s not just benefiting you but also your channel partners as you will have to provide a percentage of the money you gain by selling that particular product.

MODERN MARKETING CHANNELS

For the sale of physical goods we can classify marketing channels into four categories, they are;

1. Direct selling – when there is no involvement of retailers and you sell a product directly to consumers then it is called direct selling.
2. Intermediary selling– when there are intermediaries involved such as agents, wholesalers, retailers etc. in the manufacturing of the product from the beginning till it reaches the customers , it is known as intermediary selling.
3. Dual distribution– this involves both the above selling technique i.e. direct selling and intermediary selling. When the manufacturer sells a product directly to consumers or may choose the involvement of intermediaries, then it is known as dual distribution.
4. Reverse marketing– it basically includes scenarios such as returns or recycling. As the name suggests it is the reverse flow of product. When the product moves from the customer to the manufacturer then it is known as reverse marketing.

IMPORTANCE OF MARKETING CHANNELS

What will happen if there are no marketing channels involved? What impact will it have on the product or its pricing? The answer to all these questions is that you need to understand the actual importance of marketing channels. For this you must know that an effective marketing channel consist of 4P’s of marketing

• Product– the first factor is the product itself. Manufacturing a product that the consumer actually wants and satisfies their needs is the most important thing because only then they will purchase the products.
• Pricing– while it is important that prices are competitive to the similar products that are selling in the market but it is also important that prices are reasonable. It should be worthy of the type of product you sell and ultimately something payable by the customers.
• Place– now it’s very important for the manufacturer to decide the place of selling for example for buying an electronic gadget the customers will either prefer online purchase i.e. direct selling or from a retail which will be an intermediary selling.
• Promotion– after all these factors are put to place, then what is required is promoting your product among the Audience. Promoting your product includes telling about your product, its benefits, uses, price and where to buy it from. For organizations that are engaged in direct selling promotion through online channels is very important.

DIGITAL MARKETING CHANNELS FOR PROMOTING YOUR PRODUCTS

If you are selling your product through the internet then the involvement of any retailer or agent is hardly required hence most likely you are involved in the direct selling model of marketing channels.

In such a case your main aim must be the promotion of your product using some significant platform also known as the DIGITAL MARKETING channels.

Here, we have mentioned some of the most significant digital marketing channels that you can use for the promotion of your product or service. These are as follows;

WEBSITE

For those who are selling their products online, your company’s official website is what your customers will seek and that will be the main marketing channel of your product. Basically it will act like a distributor channel for your product.

BLOGS

For promotional purposes BLOGS works the best. Depending upon your interest and choice of product you can click on the website and reach on customized landing pages where you get all the information about the products and its features.

SEARCH ENGINES

The most significant channel for promotional purposes is search engines. It comprises SEO which stands for search engine optimization that mainly includes ways of making you land on search engines result pages of the desired website in order to increase traffic and push customers to buy more products.

EMAIL MARKETING

Since almost everyone has an email account therefore EMAIL MARKETING is the most widely used marketing channel for promotion of products and helps in directly communicating with the customer. It can be automated by the history of interest of the customers and the customers can subscribe to your website too for getting further notification and details about your products.

SOCIAL MEDIA MARKETING

Since the world revolves around social media nowadays therefore social media is the best marketing channel for promotional purposes. It allows people to navigate through their interests and have a two way interaction with the company. FACEBOOK MARKETING, INSTAGRAM MARKETING,etc are all forms of social media marketing.

CONTENT MARKETING

CONTENT MARKETING majorly includes marketing channels and platforms like YouTube where you can promote your products in the form of creative videos and pictures that can be informative and interesting at the same time for the customers.

PHYSICAL MARKETING CHANNEL PARTNERS

In the above paragraphs we discussed how direct selling requires the use of digital marketing channels for promotion but when we talk about intermediary selling then we need people for distribution, retail, sales and promotions.

Let’s discuss them in detail;

RESELLERS

A reseller is generally a person registered to buy and sell goods and services to their own networks and can also create their own pricing. They can also remove your brand from the product and sell it as their own which helps them to promote their own company.

Example- Amazon

Amazon resellers buy products in bulk from the market and then resell it with their own name on the Amazon website.

AFFILIATES

These are the people who provide you with the direct links to the product sites via their own site. These people earn a part of the money of the product sales known as a commission based on how much a link gets clicked. They do not directly provide you with the links but add them on their own websites, blog pages, YouTube channels etc. for you to navigate through them.

CONSULTANTS

As the name suggests they consult your customers to use your products or services and that too in the most significant and useful way. Just like affiliates they also earn commission for promoting or recommending your products to the customers.

BENEFITS OF MARKETING CHANNELS

A closer peep at the term marketing channels will help you understand that these are just some of the alliances or partnerships that you make to run your business. But let’s find out why your business actually requires these partnerships?

• It’s cost effective as it will be much more costly to employ people for your company to expand your reach within the market.
• Working with a well-known channel Marketing partner will help you to enhance your brand and increase your brand recognition. Channel marketing is quite similar to recommending your product to various networks for its own benefits.
• In order to experiment the impact of your products in the market, channel marketing is a great tool as they are a third party with a variety of customer base and thus enables you to run a variety of marketing campaigns at the same time.

Hence, these partnerships give you a helping hand to reach out to a greater audience which you alone cannot do as it is not practically possible. Also they share your workload, and provide with a greater scope of enhancing your brand recognition in the market.

CONCLUSION

So now that we know all about channel marketing we can jump to the conclusion that channel Marketing is not just another promotional marketing strategy but also a process that helps reach your product to the audience from its origin.

In intermediary selling it involves both the process of delivery of the product from its initial destination to the hands of customers and includes all the people engaged in that process.

At direct selling level it is mainly limited to the promotion of product with no involvement of a third party.

One needs to understand that channel marketing is not a trend in marketing it is something that was always there and will always be there but of course with advancement and modernization people are mostly shifting to online platforms for shopping.

Thus, the direct selling method is more likely to rise in the future than intermediary selling.

Also, it is clear that channel marketing can prove beneficial for your business only if you opt for the right channel marketing partners.

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