Channel Marketing Strategy & Management for Indirect Sales

Here we look at channel marketing strategy and management advice, which we have gleaned from experts in generating and increasing indirect sales revenue.

Channel marketing strategy for indirect sales

As a business owner or marketing manager, you constantly face the same predicament. You need to reach new audiences to increase revenue and growth. Yet investing too much in distribution can stretch your limited budget.

Selling your products through third-party websites, stores or reps is an excellent way to drive down costs while being present in multiple markets.

When you work with resellers, distributors, affiliate partners, or independent retailers, you build a channel sales system. This uses people and companies outside your organisation to sell and distribute your products.

This model has its ups and downs, mainly, that you don’t have complete control over distribution. But if you want to reach more customers faster, channel sales can have some serious benefits for your business.

Channel Sales Increases Efficiency

Microsoft uses channel sales to sell its software around the world. Apple relies on both brand stores and independent partners to ensure its products reach a global market. And Coca-Cola doesn’t have stores at all!

Even with the colossal budgets these brands have, it would be impossible to be everywhere without a reliable network of partners and distributors.

The channel sales model (also called indirect sales) can help you sell globally without the hassle and expense of managing hundreds of stores around the world.

You don’t need to blow your budget by launching physical locations, hiring and training salespeople, and building your own distribution channels.

In fact, according to HubSpot, one channel manager guiding several channel partners can yield revenues the equivalent of five or six salespeople, at a fraction of the cost! Moreover, finding new partners is cheaper and easier than hiring new sales personnel.

You also get:

Access to Multiple Locations

When you work with distributors and affiliates partners, your product reaches new audiences in different places. Distant sites in geographical areas where building a local presence could take months or even years, are instantly within reach.

Your channel partners travel to or have physical stores outside your national borders. This takes your brand to places that would otherwise be off the grid.

Take Advantage of Your Partners’ Reputation

Working with reliable channel partners can help you build brand awareness. By associating your image with a reputable brand that people trust, you can increase your popularity among consumers. Especially in foreign markets that may not be familiar with your brand.

Boost Productivity

With a small sales team and a handful of channel partners, you can get your products in more markets without having to increase your costs. This makes for increased productivity all round and way faster time to market.

Drawbacks of Channel Sales & Marketing

While this model is fast and convenient, it also has its challenges. To start with, you’ll need to pay close attention to detail when choosing your channel partners. Be sure to implement a series of rules and best practices to maintain your quality standards.

Collaborate with trustworthy resellers and retailers only – companies that are equally interested in maintaining a good reputation among their customers.

Just as you can benefit from their good name, you can lose market share if potential clients associate your brand with a lousy retailer.

When building a channel sales model, you also need to create and maintain efficient workflows. Communicate constantly with your channel partners to come up with new ways of improving the customer experience.

It’s essential that you work with companies that put your success on the same level as theirs. So team up with your channel partners and set common objectives to grow both your businesses.

How to Build An Effective Channel Marketing Strategy

According to a SAP Survey, 74 percent of companies using a multi-channel strategy for sales have registered increased profits. Better yet, 57 percent of them have provided an enhanced customer experience.

But selling through independent distributors is different from the traditional model where you connect directly to your buyers. Channel marketing goes beyond crafting messages for your target public, and your marketing strategy will need to be two-fold.

B2B Marketing

You’ll need to convince retailers, affiliate partners, and distributors that your product is worth selling through their channels.

In this case, you’re no longer focusing your message on how your product can help people. Your marketing message must underline the benefits of working with you and what’s in it for them!

B2C Marketing

You need a marketing message to help you hook new customers from your partner’s audience. You’ll need to speak their language and adapt the tone of your marketing materials and campaigns.

Co-branded marketing can show your channel partners that you appreciate their help and respect their contribution to your success.

Either way, you’ll need a channel marketing manager to build a stable relationship with each one of your resellers and distributors.

Together, they can come up with a customer-centric strategy to increase sales and revenues for both.

eLearning Helps You Train Your Partners

When you’re carrying out channel sales, you’ll need to focus your efforts on growing your partners as part of your strategy. Invest in educating your resellers to ensure that your customers have positive interactions with your brand outside your organisation.

The process of disseminating product and service knowledge to your partners, affiliates and resellers is sometimes known as ‘Extended Enterprise Training‘.

By making channel sales and marketing training materials available online through elearning, your partners have access to your product and service information and documentation any time and anywhere.

Benefits of Extended Enterprise eLearning

  • Reaching channel partners who might be geographically disparate – perhaps even based in multiple countries.
  • Cost reduction – no need to hire / send out trainers or have partners visit you – with all the associated travel and accommodation costs.
  • Speed of delivery – reach partners with details of new product and service details as quickly as soon as your training materials are ready – in as long as it takes to send an email.
  • Ease of updates – when your training needs to be updated due to new legislation, best practice or inventory. Need need to wait until the next available training dates.

Apple is an excellent example of channel sales best practices. The company has brand stores in many locations, but they still collaborate with resellers, for selling to companies and end-user customers.

There’s no difference between buying directly from Apple or through third-party companies, as they uphold the same high standards when it comes to quality and customer experience.

But no reseller can promote and sell your products without consistent investment in training. Customers want to know everything about a product before making a purchase. Beyond product descriptions, customers often read online reviews and technical details first.

So it’s in your interest to provide your partners with documentation, marketing content, and ongoing training. This way, they’ll know your product well enough to sell it. A portal to make the training materials for channel marketing available online is known as a learning management system or LMS. Such a platform is not only useful for 24/7 access to the elearning, but can often be branded with your own logo, colour scheme etc to help the learner feel part of your team, helping to increase engagement and a sense of partnership.

The fastest and easiest way to achieve great training results for channel marketing is without doubt through elearning.

The Takeaway

The channel marketing and indirect sales model can help you reach large audiences over different geographical areas. It’s a cost-effective solution to increase sales, without sacrificing quality.

To get the most of this system, though, you’ll need to build an efficient network of sellers, affiliates, and distributors that understand your products – and know how to promote them among their customers.

Investing in e-learning and training for your growing network of channel partners is essential, and an extended enterprise LMS can help you achieve results faster. Reach more audiences and sell more products without going into the red.