It’s no secret that an online store can be a powerful tool for generating sales and growing a business. However, it’s also important to remember that an online store is just one piece of the sales puzzle. To really maximize your sales potential, you need to have a well-defined sales channel strategy in place. In this blog post, we will discuss how to build a sales channel strategy around your online store that will help you grow your business without losing any customers!
What Are Channel Sales?
Before we can dive into how to build a sales channel strategy around your online store, it’s important to first understand what exactly channel sales are. In short, channel sales refers to the various methods that you use to sell your products and services. There are a number of different sales channels that you can use, and each has its own advantages and disadvantages.
Some of the most common sales channels used by businesses include direct sales via a website or physical store, ecommerce platforms such as Shopify or BigCommerce (both of which we offer), and third-party marketplaces such as Amazon or eBay. Each of these channels has its own pros and cons, but it may be helpful to think of them as a continuum.
On one end is direct sales, where you sell directly to the customer (e.g., through your website or physical store). On the other end are third-party marketplaces, where you sell through a platform that isn’t owned by you. In the middle are ecommerce platforms, which allow you to sell through your own website, but still give you some of the benefits of a third-party marketplace (e.g., access to a larger customer base, built-in payment processing, etc.).
Types Of Sales Channels
Traditional marketplaces, such as Amazon and eBay, are some of the most popular sales channels used by businesses. This is largely due to their widespread popularity with consumers. According to a study conducted by eMarketer in 2017, over 50% of Americans have made an online purchase from Amazon in the past year.
Third-party marketplaces also offer some benefits for businesses, such as access to payment processing and fulfilment services that can help reduce costs associated with selling products directly through your own website.
Modern marketplaces are content-driven platforms that enable commerce, such as Instagram and Facebook. While these platforms aren’t designed for selling products, they do offer the ability to create pages where you can showcase your products and link directly to your website. These platforms allow users to browse products from multiple retailers, follow their favourite brands and shops, and then purchase products directly from the site.
While modern marketplaces don’t offer the same level of reach as traditional marketplaces, they do offer a number of benefits for businesses, including:
– A built-in audience – According to Pinterest, the site has over 250 million monthly active users who use the platform to discover and purchase products they love.
– Reduced costs – Unlike traditional marketplaces, modern marketplaces don’t charge businesses a commission on sales.
– Enhanced brand awareness – Being featured on a popular site like Pinterest can help increase brand awareness and drive traffic to your website.
Retail marketplaces, such as Walmart and Target, allow businesses to sell products directly through their websites. This allows businesses to reach a large audience of consumers who are already familiar with these brands.
One of the main benefits of selling through a retail marketplace is that businesses can take advantage of the brand’s reputation and reach. For example, a customer who visits Walmart.com to buy diapers may also be interested in purchasing some of your baby products. This gives you the opportunity to increase sales without having to spend money on advertising your products elsewhere.
Wholesale marketplaces are platforms that allow businesses to sell products directly to other businesses, such as Alibaba and Made-in-China.com. These marketplaces typically require businesses to have a minimum order quantity, which can be beneficial for businesses that are looking to sell products in bulk quantities.
One of the main benefits of selling through a wholesale marketplace is that it gives you access to potential customers who may not otherwise have discovered your products. Some businesses choose to sell their products only wholesale. Others use wholesaling as one way to sell products, alongside other sales channels like online.
Channel Sales Advantages
There are many advantages to using a sales channel when selling your products. For example, you can reach a larger audience of potential customers who may not otherwise have discovered your products.
Well Known Brand Presence
Many sales channels already have a built-in audience of consumers who trust that they’ll find the products they’re looking for. For example, people often go to Walmart or Target because they know that these stores offer high-quality products at affordable prices.
This means that businesses can take advantage of this built-in trust and reach new customers without having to spend money on advertising. In addition, businesses can benefit from the trust that these platforms have earned over time.
Having one channel manager work with several partners can bring in the same amount of revenue as if five or six salespeople were hired.
Using a sales channel can help increase the efficiency of your business operations by streamlining many tasks. For example, you may find that it’s easier to manage orders from multiple sales channels through one system instead of integrating each channel’s inventory management process.
Room To Test and Experiment
Sales channels offer a low-risk way to test new products and marketing campaigns.
When you launch a new product or campaign, it can be difficult to estimate how much interest there will be from customers. By selling through sales channels, you can get an idea of what products and services are most popular before expanding into other sales channels.
Channel Sales Disadvantages
There are also a few disadvantages to using sales channels. For example, you may find that you’re limited in the products you can sell or the pricing you can set for those products.
Less Control Over Marketing and Promotion
Sales channels often have their own rules about which products they’ll promote and how they’ll promote them. This can limit your ability to control the marketing and promotion of your products.
In some cases, you may need to get approval from the sales channel before you can make changes to your marketing materials or website. This can slow down the process of making changes and can make it harder to customize your marketing materials for specific sales channels.
Limited Control Over Pricing
When you use a sales channel, there’s a good chance that you’ll have to follow the pricing guidelines set by that sales channel.
This means that you may not be able to change the price of your products without approval from the sales channel. In some cases, you may only be able to change prices seasonally or in response to specific promotions.
’s Reputation Risk
When you sell your products through a sales channel, there’s always the risk that the sales channel will damage your brand.
For example, if you sell your products through a sales channel that doesn’t align with your brand values, you may find that your customers don’t trust your products as much as they used to.
Channel Partners Competition
If you sell your products through multiple sales channels, there’s always the risk that your business will conflict with one of its channel partners.
For example, if you’re selling a product that’s also being sold by one of your channel partners, you may find that sales are slow because customers would rather buy directly from the channel partner.
In addition, you may find that your sales channels are competing with each other for customers. This can lead to tension and conflict between your sales channels.
How to Know Whether Channel Sales is Right For Your Business
Your Business Size and Maturity
The size and maturity of your business can play a role in whether or not sales channels are the right option.
If you’re just starting out, you may not have the resources to support multiple sales channels. On the other hand, if your business is well-established and has a large customer base, sales channels can be a great way to reach more customers.
Product Line and Market Segmentation
Your product line and market segmentation can also play a role in whether or not sales channels are the right option.
If you sell products that need to be demonstrated, or that are only sold through a few specialized sales channels, you may not be able to use sales channels.
On the other hand, if you sell a wide range of products that can be sold through a variety of sales channels, you may have more success using sales channels.
Business Operating Location
Finally, your location and logistics can also play a role in whether or not sales channels are the right option.
If you sell products that are difficult or expensive to ship, you may not need sales channels. On the other hand, if your products are small and easy to ship, sales channels can be a great way to reach more customers.
If you’re still in the process of developing or testing your product, sales channels may not be right for you.
However, if your product is ready for market, sales channels can be a great way to reach more customers.
How to implement a channel sales strategy
Create Relevant & Beneficial Content To Gauge Partners
In order to attract sales partners, you need to create content that’s relevant and useful for them. This content should include information about your products as well as how they can help their customers.
Think about who you want to work with, and then create content that is relevant to them. For example, if you want to work with retail stores, you may want to create a content piece that talks about how your products can help store owners increase sales.
Once you have sales partners, it’s important to give them their own portal that’s specifically designed for their needs.
This should include tools and resources to help them sell your products as well as a place where they can track their sales and performance.
Structuring The Channel Sales Partnership
When you’re setting up a sales channel partnership, it’s important to choose the right structure. This will depend on the products you’re selling, the sales partners you’re working with, and your business goals.
Some common structures for sales channel partnerships include:
– Exclusive rights: In this structure, one sales partner is given exclusive rights to sell your products. This can be a good option if you want to focus on a specific sales partner, or if you want to enter a new market.
– Non-exclusive rights: In this structure, multiple sales partners are given the right to sell your products. This can be a good option if you want to expand your reach and sell through more sales partners.
– Dual distribution: In this structure, your products are sold through both the direct sales channel and the indirect sales channels. This can be a good option if you want to reach more customers, but don’t want to give up control of your direct sales channel.
Choose Your Partners Wisely
Before you decide to work with a sales partner, it’s important to make sure that they’re a good fit for your business. Look for sales partners who have a similar customer base to yours and are willing to sell your products at the right price point.
You should also make sure that your sales partners are willing to work with you and provide the necessary support. For example, if you sell a product that requires technical support or installation, your sales partners should be willing to provide this for their customers.
Develop a list of what you are looking for in a partner. This will help you find someone who is right for you and your business. They need to have at least these:
- Understand your target audience.
- Offer a service that complements what you do. This can be something that is related to your industry or something else that they are good at, and can benefit your business.
- They need to be skilled and have the resources necessary to market and sell your product.
Empower & Entice your Channel Sales Partners
Your partners are an extension of you and your business. As such, it’s important to entice them with the right incentives and empower them to sell your products.
- Offer exclusive discounts to your partners: This will give them an incentive to sell more of your products.
- Provide sales training: This will help them understand how to sell your products and give their customers the best experience possible.
- Provide marketing materials: You can create brochures, flyers and other marketing materials to help your partners sell more products.
- Give them an incentive: You can give your partners an incentive to sell more products, such as a commission or bonus structure.
- Make it easy for them to track their sales: This will help your partners see how well they are doing.
- Reward them for their efforts: You can give your partners a reward when they sell more products.
- Give them leads: This will help your partners find more customers to sell to.
Hiring a channel sales Expert
If you’re not sure how to manage your sales partners, or if you don’t have the time to do it yourself, you may want to consider hiring a channel sales manager. This person will be responsible for managing your partners and helping them sell more products.
Making sure that each of your partners gets the attention they need is important for their success. Usually, this is done by companies that are bigger than yours. This is usually done by bigger companies with a channel sales manager. The channel sales manager is responsible for providing resources to partners so that they can be successful and help them with their needs.
Examples Of Sales Channel
Resellers: A reseller buys a product from the company that makes it and sells it to the customer who wants it for a profit. A reseller is like a middleman between the company and the customer.
Affiliate Partners: An affiliate partner is a company or individual that promotes your products in exchange for a commission. They usually have their own website or blog where they promote your products. This can be a great way to reach new customers and generate more sales for your business.
Distributors: They get products to the consumer. Some examples of distribution channels are agents, websites, or businesses that act as intermediaries between the manufacturer and retailer.
Wholesalers: A wholesaler is a business that buys products from manufacturers and sells them to other businesses. They usually don’t have their own sales force and rely on the manufacturers to sell their products.
Value Added Reseller (VAR): Value Added Resellers (VARs) are companies that purchase and resell technology products, including software or features. These features might be things that the original manufacturer doesn’t offer.
Independent Retailers: An independent retailer is a business that sells products to consumers. They usually have their own brand and are responsible for selling your products to the public.
Dealers: Dealers sell products to end consumers. They are different from retailers, who sell many different types of products to many different people. Automobile dealers are a good example of dealers.
Agents: In this channel, agents help buyers and sellers make deals. Agents don’t own anything, but they help with the negotiation process.
Consultants: Consultants are people who help you make a decision. They can give you advice on everything from how to sell your products to whether or not they think you should expand your business.
The channel sales model is an effective way to increase your sales. It allows you to focus on the products and services you provide while leaving the sales and marketing to your partners.
Channel sales is an important part of growing your business. It can help you reach new customers and drive more sales for your company. But, it’s important to make sure that you set up a strategy and structure that works for your business.
About The Author
Rizwan is a Senior Marketing Associate at Abubble. One thing he loves about Digital Marketing is the instant results it delivers- starting from nothing to become a brand in no time. He has specialised knowledge in SEO Content Curation & Link Building which enabled him to help clients stand out even in heavily saturated business markets. In his spare time, Rizwan can usually be found doing e-gaming & entertaining through his quick wits - he’s great at everything!