What is the best way to choose distribution channels for your product?

1 Understand your product

The first step to choose the best distribution channels for your product is to understand its characteristics, such as its value, quality, complexity, and shelf life. These factors will influence how you package, transport, store, and sell your product. For example, if your product is perishable, you may need a shorter and more direct channel that can preserve its freshness and reduce waste. If your product is high-end, you may want a selective channel that can enhance its image and exclusivity.

2 Know your market

The second step to choose the best distribution channels for your product is to know your target market, such as its size, location, preferences, and behavior. These factors will influence how you reach, communicate, and serve your customers. For example, if your market is large and dispersed, you may need a wider and more indirect channel that can increase your coverage and accessibility. If your market is niche and loyal, you may want a closer and more direct channel that can build trust and relationships.

3 Define your goals

The third step to choose the best distribution channels for your product is to define your goals, such as your revenue, profit, growth, and differentiation. These factors will influence how you price, promote, and distribute your product. For example, if your goal is to maximize revenue, you may need a more aggressive and diversified channel that can capture more market segments and opportunities. If your goal is to optimize profit, you may want a more efficient and integrated channel that can reduce costs and risks.

4 Assess your resources

The fourth step to choose the best distribution channels for your product is to assess your resources, such as your budget, capacity, expertise, and network. These factors will influence how you manage, control, and support your distribution channels. For example, if you have limited resources, you may need a simpler and more outsourced channel that can leverage the capabilities and connections of intermediaries. If you have abundant resources, you may want a more complex and more owned channel that can give you more autonomy and flexibility.

5 Compare your options

The fifth step to choose the best distribution channels for your product is to compare your options, such as their advantages, disadvantages, and trade-offs. You can use various criteria to evaluate different distribution channels, such as their suitability, feasibility, profitability, and compatibility. For example, you can compare how well each channel matches your product, market, and goals; how easy and realistic each channel is to implement and maintain; how much each channel contributes to your bottom line; and how consistent each channel is with your brand and values.

6 Test and refine

The final step to choose the best distribution channels for your product is to test and refine them, such as by conducting market research, experimenting with different combinations, and collecting feedback. You can use various methods to test and refine your distribution channels, such as surveys, focus groups, pilot programs, and analytics. For example, you can ask your customers about their preferences and satisfaction with your distribution channels; you can try different mixes of direct and indirect channels; and you can measure the performance and impact of your distribution channels on your sales, costs, and customer loyalty.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?