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Channel Marketing is the process of working together with channel partners to sell a product or a service. The channel is the path through which the product moves from the point of production to the end buyer. Channel partners may include the producer, distributor, wholesaler, and retailer. The channel partners perform different functions. Some of the functions channel partners provide include the transactional (resellers), logistical (distribution, storage, transport), and facilitation (salespeople and financing). Marketing channels have three important functions; buying a product or service to resell, distribution to the customer, and customer support and service.
Channel marketing is most relevant to larger firms that cover a broad landscape. There are a few types of marketing channels; producer/customer, producer/distributer (wholesaler) /retailer, and more recently, multichannel, omnichannel, and cross-channel marketing. The last three types of channel marketing refer to using various combinations of marketing and sales on and offline; stores, websites, mail, and email for example. There is software available to supplement channel marketing, two examples of which are Zift Solutions and TIE Kinetix.
Channel marketing has unique challenges due to the partnerships involved. All players affect the presentation of the service or product, which makes finding the right partners an important element. Choosing partners involves analyzing data, the market, and compatibility factors. Partner relationships must also be negotiated and reassessed throughout the process. In channel marketing, businesses must market themselves to one another as valuable partners, as well as marketing their product to retailer needs.
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