Insights / Checklist / Go-to-market (GTM) and commercial strategy
ChecklistChannel choices: direct, partners or online
Each sales channel trades margin, control and reach. A short checklist helps you choose the right mix for your product and customers.
How you reach customers shapes your business as much as what you sell. The same product can succeed through a direct sales team, struggle through partners and thrive online, or the reverse. Yet channel choices are often made by habit: the way the company has always sold, or the way a competitor does.
Each channel trades margin, control and reach. There is no universally right answer, only a better or worse fit for your product, your customers and your resources. This checklist sets out the trade-offs and the questions to ask before committing.
Direct
High control and margin, but higher cost to serve. Selling directly, through your own salespeople or account managers, gives you the closest relationship with customers. You control the message, the price and the experience, and you keep the full margin. You also learn directly what customers want, which feeds product and service improvements.
The cost is significant. Salespeople are expensive to hire, train and retain, and each one can only manage a limited number of relationships. Direct sales work best for complex, high-value offers where customers need advice, where deals are large enough to justify the cost and where the relationship continues after the sale.
- Best for: complex products, large deals, long relationships, offers that need tailoring.
- Watch for: high cost per sale, slow scaling, dependence on a few key salespeople.
Partners
Wider reach with shared margin. Distributors, resellers, agents, consultants and technology partners can take your product to customers you could not reach alone. They bring existing relationships, local presence and sometimes complementary services that make your offer more complete.
In return, they take a share of the margin and some control. Partners sell many products, and yours competes for their attention. They need training, materials, support and a commercial model that makes your product worth their effort. A partner programme that is launched and then neglected rarely produces much.
- Best for: reaching new regions or sectors, products that fit into a partner’s wider offer, markets where buyers trust local advisers.
- Watch for: weak partner commitment, inconsistent customer experience, channel conflict with your own sales team.
Online
Scalable, with need for traffic and fulfilment. Selling online, through your own website, a marketplace or a self-service sign-up, can serve large numbers of customers at low cost per sale. It suits products that are simple to understand, easy to buy and quick to deliver or start using.
Online is not free, however. You need a steady flow of the right visitors, which takes investment in search, content, advertising or partnerships. You need a buying process that works without a salesperson to answer questions. And you need fulfilment, delivery, onboarding and support that keep pace with demand.
- Best for: standard products, smaller transactions, customers who prefer to research and buy on their own.
- Watch for: high cost to attract visitors, low conversion, returns and support load, marketplace fees and dependence.
Combining channels
Many businesses use more than one channel, and that can work well. A common pattern is online sales for smaller customers, partners for particular regions or sectors and a direct team for the largest accounts. The risk is conflict: partners who find your own salespeople competing for their customers, or direct customers who discover a lower price online.
Clear rules prevent most of this. Define which customers each channel serves, keep pricing consistent or explain the differences, and decide how credit is shared when channels work together on a deal. Review those rules as the business grows.
Start with one primary channel
For a new product or market, master one channel before adding others. Each channel needs its own skills, systems and attention, and spreading effort too early often means none of them works well.
Channel choice checklist
- We know how our target customers prefer to research and buy.
- We know whether our offer needs advice, tailoring or demonstration before purchase.
- We have estimated the cost to acquire and serve a customer in each channel.
- We have compared that cost with the typical deal size and customer lifetime value.
- We know which partners already have the relationships we need, and what they would expect in return.
- We have the traffic, fulfilment and support capacity an online channel would require.
- We have chosen one primary channel and can resource it properly.
- Where we use more than one channel, we have rules on territories, pricing and credit.
- We have agreed how we will measure each channel’s performance.
- We have set a date to review the channel mix.
Work through the checklist with sales, marketing and finance together. Where the answers are uncertain, run a small test, such as a pilot with two partners or a simple online offer, before committing significant budget.
Source: Intelliversal analysis.
