What Is Channel Management? Types And Process

What Is Channel Management

What Is Channel Management?

The definition of channel management describes the sales and marketing strategies that a company uses to satisfy customers. It also includes techniques used to support partners in the distribution process. The goals of each channel must also be defined when creating channel management solutions.

Channel is the process by which a company sells its products and services to a target audience. The definition of channel management requires clear goals.

  • Identify the products that are appropriate for a specific channel
  • Determining the policies and procedures to manage the channels of the company
  • Develop marketing and sales plans for each channel. To understand the needs of customers, not the companies.

The channel management definition describes the process of choosing the best channel partners and how they do it. To create different distribution routes to ensure that the products are available on the market. To establish different distribution channels, it is important to consider the buying habits and customer requirements.

For example, If products are intended for adults, Targeting grocery products can then be done via both online and offline channels.

Physical stores that are well-established turn out to be the most popular. It is easier to sell products as compared to online channels.

The business must therefore identify, analyze, and decide which channel is best suited. Based on the expected output from each distribution channel. This is not all. It determines which segment of the population is connected to each channel management definition. Once all relevant information has been made available, The right investment channel can then be chosen to achieve maximum sales and profits.

Also read: Product Development Process | Definition and Overview

Types Of Channel Management Meaning

These are the main types of channel management definitions:

Channel Strategy

Channel strategy covers sales and distribution strategies, such as ways to expand the market or specific plans to improve customer relations management.

Channel Architecture

This concept is the foundation of an organization’s channel. This concept determines the route the product will take from the manufacturer to the customer.

Sales Management

This involves the management of sales and other partners. Sales management can also include incentives that are offered to drive sales.

Channel Design

Channel design is the effort to create new channels. An affiliate program may be used by a company to encourage specific types of people and companies to promote their products.

Channel Conflict

Plan to resolve conflicts between channels that are unfair or counterproductive to one side. If e-commerce is used to lower the affiliates’ profits, the conflict should be addressed. When designing channels, it is important to ensure that none of the channels are affected by another channel.

Brand Experience

Creating a consistent brand experience across all channels includes online selling via social media, as well as physical locations such as stores and boutiques. For example, some beauty brands, make customers feel special. But, it’s much easier to do this in person, The online experience must be complemented by the same experience, offering special deals and other perks

Relationship Management

Relationship management is the art of managing and establishing relationships with vendors, affiliates, etc.


It states that pricing is determined by channel-based strategies. It is like a luxury bakery selling specific products in upscale areas. This is a case of pricing under channel management.

Revenue Management

Optimizing revenue for available inventory. A retail store might sell swimsuits at full price until the end of summer. He may then discount his inventory to make way for winter products.

Operations and Sales Planning

This involves matching the demand for goods and services with production. If a company produces a product that is popular during a particular time of the year, this can be used to increase production. They may also increase production during that season.


This step is about balancing obligations between customers and channel partners. This includes handling logistics such as product exchanges and returns.

Also read: What is Distribution Management and Planning?

Problems Of Channel Management

Management problems are a part of every business. It is important to find ways to maximize the return on investment for each channel. This section explains what challenges channel management might face.

  • At the end of the intermediary, enthusiasm is lower
  • Communication between manufacturers and distributors is not good
  • Conflict can arise when distributors sell the products of other competitors (that could happen because there is too much competition).
  • Delay in Supply Chain Management and Shipment
  • A distributor may have lower sales due to multiple channels. For example, a producer might decide to sell the company online.
  • Advertising and marketing are not enough

Process of Channel Management

The success of a business depends heavily on its intermediaries, such as wholesalers, retailers, and agents. This represents the company’s product on the market. This definition of channel management must establish a healthy relationship between the middlemen. They must provide financial and non-financial benefits in order to promote the product of the manufacturer.

The channel management process definition can also be explained in 6 steps. These steps can be accessed from the following:

Identification of Sources

First, the process of channel management definition It is the identification of references or sources. You are a newcomer to the market The company must continue to do research to find sources using different methods You can contact the trade associations by enquiring in the market.

To find the reputation of distributors and customers and take part in trade exhibitions. Different intermediaries can approach a producer who is well-established. It is important to conduct background checks on middlemen before you sign any contracts.

Customer reviews are one of the most important things a manufacturer should check. The intermediaries and distributors, their passion to sell, and the sales force.

Preparing Selection Criteria

Next, you can prepare selection criteria that turn essential for effective channel management definition. There are many factors to consider. Before choosing channel intermediaries with different qualities, producers must think about these things.

Factors could be market and product knowledge. Competitiveness, understanding customers, the reputation of intermediaries and managerial competence, market coverage, etc. A distributor may have a great reputation, but sell products from other competitors. He might also be less enthusiastic about selling.

A small distributor, with less popularity and salesforce. He can also be more enthusiastic about selling. In such situations, the manufacturer will likely choose the second distributor.

Selection Of Intermediaries

It is crucial to choose the right distributors for your business growth. There are many middlemen that can be found on the market, all of the various sizes. The new and small-scale intermediaries can turn inexperienced but, can be created. You might be able to sell products more enthusiastically and with better sales skills or resources

Furthermore, They will sell products of the company with fewer incentives and a lower margin. The organization must also offer greater incentives to established and large-scale distributors who distribute their products on the market.

The company only needs to find the right intermediary to help them grow its business. It will be based on the company’s future goals and needs. Channel management definition partners can be beneficial in realizing future goals.

Provide Appropriate Training to Middlemen

Once channel management definition partners have been selected, the next step is to train them. Next, the next step is to train intermediaries according to the goals and the requirements to effectively and efficiently sell the product. The training can give the intermediaries essential information about the products as well as the organization.

Channel partners will be able to use the information provided in the correct direction. Marketing, staff management, finances, sales, and stock control are all important areas. Small distributors will appreciate the training as they don’t have established processes for managing the areas.

Motivating Them Whenever Needed

The forward step is used to motivate channel partners during the process of channel management definition. Motivation can prevail in both financial and non-financial forms. Few distributors are motivated by a company that offers a higher margin on sales.

Others might want to be granted territorial rights in certain geographical areas. This can be done verbally, by giving them updated products and acknowledging their efforts. Maintaining personal contact with them, and offering solutions to their problems. This step can hinder the performance of channel partners.

Assessment Of Intermediaries

We also need to assess the performance of each intermediary in order to define channel management. This evaluation helps you decide which channel partner you should retain and who to drop.

You can use a variety of criteria to evaluate channel partners, such as customer response, sales skills competencies, quality of service, customer satisfaction, position in-store display the quantity of stock bought, etc. Once the data has been collected, it is possible to continue the business by selecting the right type of channel management partner.

Channel Management Strategy

A variety of functions are served by channel management in a marketing plan. The channels are responsible for finding new ways to market the customers they prefer. The company can also create experiences for its target audience through social media, once they have chosen the right channel (such as social media), to build brand loyalty.

A channel strategy is a way for brands to think about factors such as consumer behavior, brand environment, and so on. It is important to remember that not all channels are relevant for every business or brand.

Companies have access to a limited number of sources, so it is important to choose the appropriate channel for the best results. The following are some common strategies for channel management:

Ecommerce or Retail

Retail is the oldest or traditional method of marketing channel strategy. This includes opening a physical store that customers can visit, or operating online. Customers can then purchase goods or services from this location.

Modern companies now combine the, Two – eCommerce pursuing a 2-factor approach to retail operations and eCommerce. This is a two-factor approach. Online orders can be handled by retail stores, while eCommerce offers additional support for local stores.

SEM and Digital Sales

Companies that sell directly to customers and other brands. The channel management strategy includes the SEO strategy. Pay-per-click advertising or search engine marketing, also known as search engine optimization, refers to an effort to draw attention to the company.

These concepts are more about getting the brand noticed by customers via social media platforms or digital platforms than directly communicating with customers or partners.

Also read: Top 14 Referral Marketing Software to Increase Your Sales

Personal Selling and Social Media Marketing

Search engine campaigns can be tailored to the company’s preferences and the language of the target audience. However, they are not as personal as other channel strategies.

One of these options is social media marketing companies are adapting to their customer’s needs with the help of the marketing strategy They want to build stronger relationships with brands. These social campaigns and personal selling allow organizations to promote and engage customers simultaneously.

Direct Mail And Email Marketing

This strategy focuses on taking the right information to the customers rather than waiting for them. To find the content posted online or in-person store advertisements. Direct mail marketing and email marketing As standard components of channel management strategy designs,

The terms go beyond just sending out messages to prospects. Mail-based marketing involves more than just sending messages to prospects. It also involves nurturing the targeted audience and maintaining personal relationships through valuable interactions. Campaigns are conducted over a period of time to build trust and awareness, and to promote the brand.

Marketing Partners and PR

if the company is new or wants to concentrate on a niche market. it can create brand awareness. Partnering with other companies is one of the best channel management strategies. Marketing affiliates, PR partners, and ambassadors help to drive attention to the company through media coverage. Companies can reach more customers if they have the right partners.


The definition of channel management is the selection of channel partners or methods by which an organization reaches the target audience. There are many common strategies, such as direct marketing, personal sales, or SEO.

A business can choose the right channel according to its goals and needs. For a better understanding, we will also discuss the process of establishing efficient channel management.

Written by
Barrett S

Barrett S is Sr. content manager of The Tech Trend. He is interested in the ways in which tech innovations can and will affect daily life. He loved to read books, magazines and music.

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