The main objective of a sales team is, of course, the sale. Achieving this can be simple for small organizations with a single, clear sales channel. However, complex businesses with many sales channels can benefit from a more inclusive approach. A successful multi-channel strategy engages, among others, the marketing, distribution and finance teams. He can also spend as much time managing direct and indirect sales teams. This integrated approach can increase profits, but it can also increase management challenges. To achieve the ultimate goal of more sales, managers must have a solid understanding of sales channel marketing and its many components.
Sales Channel Marketing Responsibilities
As noted above, a myopic focus on sales may not lead to more sales, especially within a large-scale, interconnected sales strategy. An effective strategy identifies the best use of marketing and sales resources to increase collaboration and minimize conflict. To achieve these general objectives, a sales channel management strategy must align the efforts of internal and external teams.
The roles of marketing, sales and distribution
So what is channel marketing? What role does it play in a sales channel strategy? A channel marketing strategy supports a sales team by building awareness of a product and helping prepare a potential customer to interact with a member of the sales team.
A channel marketing strategy can help prospects simply know that a product exists. For well-known products, it can continue to keep a brand top of mind or reaffirm its key differentiators. During long sales cycles, a marketing team may send an ongoing set of messages to potential customers to help prospects “prepare” for the sales team.
Historically, the distinction between the marketing department and the sales department, the first responsible for leads, the second for sales, has led to conflicts. When profits plummet, marketers tend to claim that sales staff fail to close quality leads. On the other hand, members of the sales team tend to say that the leads are of poor quality.
This potential source of conflict can quickly undermine an effort to develop a functional multi-channel strategy, which depends on deep collaboration. The need for collaboration can extend beyond marketing and sales teams to include channel partners as well. While the marketing and sales channels must generate sales, the distribution channel must fulfill these obligations.
A dysfunctional distribution component can severely hamper a company’s ability to deliver a product or service to customers. Thus, all three channels must work together to build a sustainable multi-channel strategy that promises customers compelling benefits and consistently delivers those benefits.
Direct Sales, Indirect Sales, and Channel Conflicts
Even within sales, there are important distinctions. Direct sales refer to sales made by sales personnel within the company. Indirect sales are those made by third-party partners. This distinction has two main implications:
- Sales channel marketing should support direct and indirect sales.
A channel marketing strategy may need to influence more than the end customers. He may also need to influence partners who are part of an indirect sales strategy. After all, partners are interested in working with companies that will also help them earn money.
A comprehensive sales channel marketing strategy can help consumers understand the benefits of a product and also help channel partners understand the profitability of selling that product. These demands on channel marketers often require a large team to develop targeted messages for each party.
- Sales channel managers should seek to reduce conflict.
With multiple sales channels, customers can choose to buy directly from the company, through a wholesaler, or at retail. Companies seek to develop these channels to provide customers with increased access and choice, which can lead to increased overall sales.
However, this choice also raises the conflict potential. Internal and external sales teams can fight over the same customer, which can lead to confusion and frustration. Successful sales channel managers closely monitor sales team responsibilities to minimize conflict across all sales channels.
Deeper interdepartmental collaboration
A collaborative process may not stop at sales, marketing and distribution. Ultimately, a sales manager or vice president of sales reports to the CEO. During these conversations, the most important metric may not be the raw number of sales, but rather the profitability of those sales.
To develop a profitable channel selling strategy, managers may need to work with a company’s finance department to determine the expense-to-revenue ratio for different channels. Beyond identifying the most lucrative channels, this knowledge can help predict staffing needs and ensure a growing sales team stays within the bounds of company profitability.
Increased integration may concern managers accustomed to working more autonomously. Yet the demands of a multi-channel strategy continue to provide benefits to those increasing collaboration within an organization as well as with external partners.
How to Effectively Manage Sales Channel Marketing
The many responsibilities involved in managing sales and marketing channels provide opportunities for continuous improvement. These are the keys to developing and maintaining a successful strategy.
Conduct extensive background research
At the start of a new or expanded distribution strategy, managers should ask themselves three key questions:
- Who is the buyer?
In many cases, the response will include multiple buyers. These buyers can be consumers, wholesalers, retailers or others. As part of an initial research phase, all potential buyers must be included, even if some are subsequently excluded from the strategy. Assessing the complete landscape for all potential buyers provides managers with an initial understanding of the full potential of a multi-channel strategy.
- Where can we reach them?
By identifying potential places of influence, managers can begin to develop a sales channel marketing strategy to reach potential customers. These customers can provide a diverse list of marketing opportunities that include trade publications and trade shows, as well as traditional direct-to-consumer channels like television or radio.
- How to reach them?
This last question begins to assess the feasibility of reaching target audiences. By understanding the potential cost of reaching certain consumers, such as developing, producing, and distributing a TV ad, managers can begin to realize which channels will have the highest spend. This advance information can help direct a marketing and sales strategy towards the most profitable avenues.
Take advantage of technology
Some salespeople or managers may be hesitant to adopt new technologies. However, using a Customer Relationship Management (CRM) or Partner Relationship Management (PRM) system has significant benefits for channel management:
Sales forecast. To accurately forecast sales, managers need a constant stream of historical and contemporary sales data. A CRM or PRM allows sales staff to rate prospects based on the likelihood of a sale and the potential value of that sale. This information, in turn, can be combined to generate sales forecasts. By monitoring the accuracy of these forecasts, managers can help sales team members adopt better lead scoring practices to improve forecast accuracy.
Channel analysis. In a multi-channel strategy, managers benefit from knowing more about the value of each channel. A CRM or PRM can segment lead and sales data by channel. In addition to helping identify valuable channels, real-time insights can help shift resources for maximum impact. For example, a sudden growth in wholesale leads may warrant increased investment in an email marketing campaign that targets their needs.
Combined analysis. A CRM and a PRM combine data from marketing and sales teams. The evaluation of sales data can influence the content of marketing materials. Likewise, including marketing information can help sales reps learn about a prospect’s past interactions before the sales conversation begins. the continuous exchange of information between teams can help create a smoother experience for prospects.
The requirements and benefits of channel marketing and sales
The multi-channel approach described in this article involves many components of a business simultaneously. A marketing team must generate leads from multiple types of customers, and a sales team must work with internal and external partners to build profitable relationships. Next, a company’s distribution must fulfill the promises made by the sales and marketing departments. Finally, all components are evaluated for their contributions to the business goals defined by the C-Suite.
Developing a successful marketing and sales strategy can be fraught with challenges. Managers who are reluctant to increase collaboration and openly share data may struggle to overcome some of these common issues. Successful managers, on the other hand, benefit from remaining open to new internal and external partnerships, and the deployment of technology that supports them.