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What is a Channel Manager and Why Does Your Business need one?

Every entrepreneur knows that it is essential to keep up with changing trends and developments in technology or to risk being left behind by the competition. To most, this means getting the best use out of enterprise management software to make the business run more smoothly, using cloud-based technology to simplify hardware and software needs, and so on.

However, the implications of the technology age run deeper. One important consideration is that tech has as much impact on buyer behavior and demands as it does on your own internal processes. Customers are exploring, selecting and purchasing their products and services in vastly different ways to 20 years ago.

Busy Channel Manager

It’s not just about ecommerce – although that is certainly a factor. The truth is there are far more channels by which a successful business will be reaching its customers, both direct and indirect. This is where the role of the channel manager comes to the fore, and it is a function that is increasingly seen as essential to stay relevant and competitive in the modern marketplace.

What does a channel manager do?

Fairly obviously, a channel manager has responsibility for your various sales channels. The reason that there are now more Channel Manager jobs available is because the role has grown in importance due to the diversity of those channels. Historically, it was a case of businesses either selling directly to consumers or drawing up agreements with retail chains, sales agents, wholesalers and the like.

This still happens, but the internet age has added a new level of complexity. Suddenly there are online and offline channels that might fall into all these categories. There is also far more choice. It doesn’t take any great leap of the imagination to see that more channels means more sales, but managing all these relationships, ensuring brand image does not become diluted and overseeing the different marketing strategies takes time and needs specialist skill.

Choosing the right channels

It is easy to put the cart before the horse and assume that the job of the Channel Manager is to spend time every day maintaining relationships, monitoring sales performance, working with the channel to devise new promotional campaigns and so on. This is all true, but before any of that can happen, it is essential to get the right channels in place.

Many new businesses look to piggyback on existing customer loyalty by selling on a channel that already has a wide customer base. You only have to look into the eyes of those entrepreneurs on Dragon’s Den and you know most would sell their own grandmothers for a distribution deal with a Walmart or a Tesco. However, for more mature businesses, that is not always the case.

When Apple started selling its MacBooks through indirect channels, it faced an interesting challenge – it already had the brand recognition, and its biggest fear was that indirect sales channels would dilute that – here is one of the few businesses that would probably walk away from a deal with a major supermarket chain.

Selecting the right partnerships on the right terms and then carefully building those relationships is, therefore, one major benefit to employing a knowledgeable channel manager with the right qualifications.

Channel manager leading a business efficiency meeting

Business efficiencies

Using well-organized and properly managed sales channels is a great way to increase business efficiency while also boosting revenue. The simple fact is that one channel manager overseeing a handful of channels will generate far more sales than half a dozen full-time sales managers – and at a fraction of the cost.

Better still, once your channel program is in place, it is eminently scalable. In other words, adding new sales channels to the mix is relatively straightforward, and will certainly involve less cost, training and management time than getting more sales staff onboard.

Flexibility

Diverse sales channels give you the perfect opportunity to experiment with new products, services and promotions. If you want to try something out, you can pilot it through a single channel quickly and easily, while leaving others untouched to act as a “control.”

Is channel management right for your business?

If you are still in two minds about whether a channel sales strategy is right for your business, here are some factors to consider:

  • Size of the business: Channel partnerships are a great way for small businesses to grow rapidly, without the need to recruit and develop an internal sales team.
  • Product and process maturity: If your product or service is still in its infancy, it is sometimes better to stay close to your customers through direct sales. Until you understand for yourself what are the key sales triggers and so on, it will be difficult to define an effective channel sales strategy.
  • Geographical spread: If your business and your customers are spread far and wide, a channel sales model will provide optimum reach.
  • Financial needs: If you need revenue and you need it fast, direct sales might be safer. It takes time and investment to get a partnership program up and running, so ensure you have a financial cushion behind you before you get started.

About author

Ivan Widjaya
Ivan Widjaya 3430 posts

Ivan Widjaya is the Owner/Editor of Noobpreneur.com, as well as several other blogs. He is a business blogger, web publisher and content marketer for SMEs.

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