Direct and indirect channels
- Direct: the business sells straight to customers, through its own website, stores, sales team or app.
- Indirect: intermediaries sell for it, such as wholesalers, retailers, distributors, resellers and online marketplaces like Amazon.
- Hybrid: a mix of both, such as selling online directly and through retailers.
Choosing distribution channels
Consider where your customers prefer to buy, the margin each channel leaves, how much control you need over price and brand, and the cost of reaching customers yourself. Selling directly gives more control and customer data; intermediaries give reach.
Content distribution channels
- Owned: your website, blog, email list and app.
- Earned: media coverage, shares, reviews and links from other sites.
- Paid: ads and sponsored content.
Plan distribution when you plan content: a great article that nobody sees doesn’t help.
Distribution channel example
A small chocolate maker sells in four ways: from its own online shop (direct), in its own market stall (direct), through gift shops (indirect, via retailers) and through an online marketplace (indirect). The online shop gives the best margin and the most customer data, the gift shops reach new customers and the marketplace brings volume with lower margin. The maker reviews the numbers each season and puts effort where profit per hour is best.
How to evaluate a distribution channel
- Where do your customers want to buy?
- What is the margin after the intermediary’s cut and costs?
- How much control do you have over price, brand and customer experience?
- What are the set-up and running costs?
- Do you receive customer data to use in marketing?
Distribution channel mistakes
- Depending on one marketplace that can change fees or rules.
- Undercutting your own retailers with lower prices online.
- Not tracking sales and margin by channel.
- Ignoring consistent branding across channels.
Distribution channel FAQs
Is a marketing channel the same as a distribution channel?
No. Marketing channels reach people with messages, such as search and email. Distribution channels deliver the product. See promotional mix and omnichannel marketing.
Can I sell directly and through retailers?
Yes, with clear price rules. See e-commerce websites and dropshipping.