© Tweeter Linder 2017 – All rights reserved. Photo by iStock
Businesses face a growing complexity associated with serving multiple routes to market. A scenario where channel partners complement the reach of your direct sales force. Beyond indirect channels a digital direct sales channel might be in play. So how can you manage sales with multiple routes to market. Where some might “compete” with each other.
In reality there are seldom a real conflict of interest
The first insight is the channel conflict is often of artificial nature. Customers have different channel preferences. Limited reach and penetration of your direct sales force. And digital channels evolving faster than most companies can adapt. Competition is not always real. And stem from predictions about how it will affect a business leader’s outlook.
The second insight is about what the second best alternative look like. Coupled to the feasibility of expanding your direct sales force. Or investment, talent and timing constrained. Is business outlook solid in the direct channel without risk. Or are you exposed to cannibalization from digital alternatives. Be careful not to exaggerate the capabilities of the existing channel/s option. As it is likely to augment perceived channel competition.
The third insight is current and future customers are moving targets. The customers you sold to yesterday might not be the ones representing your future growth. By being flexible in selecting optimal channels you can adapt faster to both current and future customers.
Multiple routes to market drive sales channel complexity
The task for businesses to manage multiple routes to market is often complex. The structure and metrics for each channel need to be sharper and better governed than in a single channel set-up.
Customers freedom to choose and move between channels is adding to complexity. As business owner you need to steer on both customer and channel needs. And set rules supporting scenarios where customers move beyond your control.
Channels don’t represent apple to apple comparisons. And you want to maximize value add for your offerings in each channel. And appropriate sales investments in each channel.
Selling through a partner/customer to the final end user
The channel challenge is further complicated when your offering is part of a sell through or sell with scenario. Where your partner can play the role as both customer and channel. A common scenario in integration intensive businesses with a large scope.
Your offering can either be a piece in a broader offering or a base for suitable for add-ons. To maximize your potential, you are keen on exploring both. Sometimes creating conflicts with other parts of your own organization.
Tensions when you both sell to and with/through your customers is a delicate topic.
Compete/Cooperate with your own direct sales force
The last scenario is when you sell both direct and indirect with a grey-zone in target segments. You might want to sell direct, up to a point where you understand a given segment. And leverage channels for scaling your business. Until you have nailed the launch customer you might target the same customers as your channel partner.
This scenario is further complicated if you have channel and direct sales in different teams. But the red thread through this blogpost is clear strategy and metrics reduce the problem. And when you aspire to grow faster than you can grow your classic direct channel, indirect and digital options are attractive.
Questions for you and your team
- Do we have real or artificial conflicts – in a real growth case expect artificial to be the norm.
- How do we qualify opportunities between direct and channel sales – unclear guidelines increase competition.
- What is our strategy for direct and channel expansion – clear strategies reduce potential conflict.
- Which competitive scenario do we struggle with the most – be crisp on articulating and addressing one issue at a time.
Additional reading suggestions
- Why channel leaders need to think like top sales leaders [BLOGPOST] – The Spur Group
- How to avoid sales channel conflict [BLOGPOST] – by Openview
- Channel conflict management: How to manage through it and win [BLOGPOST] – by Mondaq
- Managing sales channel conflicts: Help reps play together [BLOGPOST] – by CEB
- The great versus indirect vs indirect debate: a shifting battleground [BLOGPOST] – by Eye for travel