The Challenge of Distribution Channels in Marketing
Sales and Marketing are two vital arms of businesses. For starters, businesses do have more than just a pair of arms. The beauty of Marketing is that it finds out, or at least, it is supposed to find out what is it that businesses needs to sell. And the Sales Department actually sells the stuff that Marketing predicts, will sell in the market. The distribution channel goes all the way from the organization through the wholesalers, retailers and the end consumer. The problem that businesses face is that the distribution channel, which is the vital stream that takes the product to its destination, is being shared by every other competitor.
Forms of Distribution Channel: The problem of distribution channel is the same regardless of which product it is or which industry the company belongs to. Distribution channel in the case of a publication is physical, while it is entirely digital in the case of an e-magazine. While the publication would have to go through the whole chain and can end up either in the book stores or in the libraries for consumers to lay their hands on, the e-magazine or the e-book doesn’t get to the hands of the consumer directly either, though it may seem so. A company like Amazon is in itself a Retailer, which makes the company part of the distribution channel, unless Amazon plans to enter the books publication business and gets going with a set of writers and books.
Further, distribution of e-books very much depends on the wireless network carrier of the nation or the region that the company plans to distribute the books in. The wireless carrier becomes the distribution channel in this case.
Direct Distribution Model: There are companies like Dell Computers that have resorted to the Direct Selling Model, where the entire distribution system is being bypassed, with its corporate sales strategy and its sales outlets that retail only Dell products. While the Direct Distribution model may seem attractive in terms of absence of competition, it would be applicable and optimal only when the company has a complete product range that would entice consumers to walk into the retail outlet. Further, Exclusive Retail Outlet is an expensive alternative, which Microsoft is also exploring with its opening of the first few exclusive Microsoft Retail stores.
Successful distribution strategy is as important a part of Marketing as is finding the needs of consumers to satisfy. Companies that fail to optimize their distribution channels to suit their business needs would not be able to reach out to consumers even if they had the best of products.
