Strategies for choosing the right distribution channel include selecting the type of channel and design of the configuration of the channel, deciding the intensity of distribution, and checking and managing the distribution channel regularly. Channels strategies are very important for distributing products and services to potential customers and target markets.
A distribution approach is regarded as intensive when an organization distributes its products or services in most of the retail outlets in an area that carries similar products or services. The examination of this type of distribution happens geographically.
A business is considered to be following an exclusive strategy for distribution if it distributes its products or services in a trading area. Different businesses can implement different degrees of distribution intensity.
The strategies of distribution are dependent on many factors, most of which are according to the preferences of the management, and the influence of the product in the market. Selecting alternative solutions that are compatible with the proposed marketing program strategies is one of the major steps taken during decision making.
The distribution intensity is mainly determined by the target market and type of product. For instance, products like luxury automobiles do not require intensive distribution for it to reach potential customers.
The next step of choosing a distribution strategy is deciding the types of intermediates used and the number of levels of organizations that can be included in the distribution channel. Some of the major factors that affect the decision on channel configuration are considerations about the end-user, characteristics of the products or services, capability and availability of channel members, resources of the manufacturer, functions that are needed to be performed, and so on.
Channel management is the next step that has to be taken after deciding on the channel design, and it includes the identification, evaluation, and recruitment of sales and channel partners. One of the most critical factors that affect the implementation of channel strategies is the finding of competent channel members, whereas the factors that affect activities of channel management involves the level of distribution intensity, choice of channel type and channel configuration.
The process of channel management involves knowing how to assist the members of the distribution channel, select programs that promote your channel, provide incentives and develop operating policies, and evaluate the results.
Managing the distribution channel is a time-consuming process as the design of distribution channels is not modified frequently. In addition to this, changes that are made in the channel design can have serious consequences for some members of the same channel.