Sales and Distribution Channels Explained
The success of your product strategy relies in part on how good your company gets at putting the right offer in front of the right customers, because one thing defines the other: the customers you target define the products you need to create, in the same way that the products you create define the customers you should target with them. That is the two-way street.
With that being said, there’s no such a thing as “a great product” unless you specify who the target customer is. A modern arc-flash industrial oven may be a great novelty, but useless for a plastic surgeon.
Putting the right product in front of the right customers implies that sales and distribution channels are a critical component to make your strategy work. At the end, you may have people willing to buy your products, but if the product is inaccessible to them, they can’t be considered as demand. A great customer segment that you can’t reach is as bad as reaching the wrong customer with the right product.
Promotion efforts, on the other hand, may also play an important role, pre-selling the benefits of your offer to your target consumers, since for sales to happen buyers must first believe that the solution can deliver its promise.
Advertising, mass and direct marketing, product information, public relations and other forms of promotion are used to affect the perception of the product in the target customers’ minds in a way that maximizes its sales.
A company can have the greatest salespeople in their workforce, but if the messaging about the solution is out-of-synch with the expectations of target customers, sales efforts will be a waste. The role of the promotion effort is to disseminate relevant information that helps differentiate products and services in the eyes of target consumers.
Sales and distribution channels, along with promotional efforts, expand the scope of your product’s value proposition and convert mere target buyers into demand. Together, they help position the solution in a competitive market.
This is where serious market research really pays off, and why defining a customer value proposition simply as a “statement of value” falls short of its true power in demand creation. To quote marketing guru Peter Drucker:
“The aim of marketing is to make selling superfluous. The aim of marketing is to know and understand the customer so well that the product or service fits him and sells itself”.