Channels of Distribution

Once you have selected and developed a unique product or business idea, correctly positioned and targeted it to buyers, and developed your packaging and pricing, the selection of distribution channels and sales representation is key to successful marketing.

It's fairly easy to change many of your marketing tactics and strategies on a periodic basis; pricing, packaging, and product mix are among these flexible choices. However, distribution and sales decisions, once made, are much more difficult to change. And distribution affects the selection and utilization of all other marketing tools.

There is a wide variety of possible distribution channels, including:

Retail Outlets owned by your company or by an independent merchant or chain

Wholesale Outlets of your own or those of independent distributors or brokers

Sales Force compensated by salary, commission, or both

Direct mail via your own catalog or flyers

Telemarketing on your own or through a contract firm

Cyber Marketing, surfing the newest frontier

TV and Cable direct marketing and home shopping channels

Distribution choices for a service business follow the same lines as those for a physical product.

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Hypothetical channel distribution

Earth distribution channel

For example, financial planning services may be offered from printed material, sold at retail by consultants, delivered electronically by computer, or relayed by phone, fax or mail.

Steps for selecting distribution and sales force representation include:

Identify how competitors' products are sold.

Analyze strengths, weaknesses, opportunities, and threats for your business.

Examine costs of channels and sales force options.

Determine which distribution options match your overall marketing strategy.

Prioritize your distribution choices.

Identify How Competitors' Products are Sold.

Small businesses may face a particular difficulty in identifying their directly competitive selling channels, not usually in identifying where target buyers buy competitive products. How Are Competitor's Products Sold?

Small companies should make a list of any competitors in their marketing area...