Channel Management Decisions and Training of Channel Members

Channel Management Decisions and Training of Channel Members

1. Channel Management

2. Channel Management is defined as a process where the company develops various marketing techniques as well as sales strategies to reach the widest possible customer base. It is defined as to how and where a product has to be used and how the product and the customer will interact. It is a process of recognising the potential customer, interacting with them and sustaining and continuing to create value for customers.

3. Managers must consider certain key factors in order to manage channels effectively such as recruiting, selecting, motivating and evaluating channel members. The channels are nothing but ways or outlets to market and sell products. The ultimate aim of any organization is to develop a better relationship between the customer and the product. 

4. Distribution channels include many of the following channel partners: Manufacturers Distributors Wholesalers Resellers Retailers

5. Channel Management Decisions

6. Recruitment of Channel Members The recruitment of channel members is the most important aspect of expanding or developing a successful channel member program which would result in achieving increased revenue generation and success. While recruiting new channel members it is vital to establish clear and fixed parameters that define standards for identification, qualification, and recruitment of new members. Such defined standards helps to confirm that the targeted members for recruitment are suitable for the parent company.

7. . Selection of Channel Members There are large number of wholesalers and distributors available in the market from which the marketer needs to select their channel intermediaries. Different manufactures have different abilities to select qualified intermediaries The factors that is need to be analysed are business experience, profit and growth records, cooperation level, creditworthiness and reputation.

8.   In the case of sales agents as an intermediaries, the manufactures must evaluate the character, quality and size of their sales force. If intermediaries are department stores then the manufacturer must intend scrutinise the location, types of clients and further sales growth .

9. Selection Process of Channel Members Identifying the potential channel members The channel manager has a wide range of sources available to find the potential channel members. some of the sources are : Trade Sources – Sources like trade associations, directories, and trade publication provide information regarding intermediaries. Customers – Customer give an honest opinion about intermediaries who work for them. The formal or informal survey helps to gain information.

10. Advertising - The approach to find potential channel members to publish advertisements in trade journals. Trade Shows – Effective way of finding potential channel members Selection Criteria for channel members After identifying the needs of customers to be fulfilled, the type of channel structure is determined. For the selection of intermediaries there are two major criteria The intermediaries must have a good knowledge of market. The market Coverage

11. Finalising the Channel Members A selection process is a mutual decision of two parties. It is not only the manufactures who is involved in the selection process but also the intermediaries at the wholesale and retail levels. The management can use various inducements to secure the services of channel members.

12. Training Of Channel Members The selected intermediaries must be provided effective and careful training sessions because the intermediaries are considered as the company by the customers. It is the responsibility of intermediaries to maintain a good and high image of the company they are representing.

13. Types of Training for Channel Members Field Training The channel sales people are provided on the job training regarding achieving sales and collecting payments from the market. Class Room Training The distributors and his staff members are given classroom training on the company’s product line, the competition level and the ways to handle the competition so as to gain large market share.

14. Orientation Programs Orientation Programs are special meetings which are organised to launch a new product and the way in which the product has to be launched. Training for Paper work Intermediaries are trained to prepare reports and maintain records. Servicing Training Servicing training are given especially for engineering products such as automobiles.

15. Motivation of channel Members In order to receive the desired results the channel members must be kept highly motivated. Channel members can be motivated through training programs, capacity building programs, promotional support, and marketing research. The manufactures use positive motivators like special deals, high margins, premium , display allowances, Advertising allowances, and sales contests. The manufacturers also use negative ways like threaten to reduce margins or terminate the relationship.

16. Evaluation of Channel Members The evaluation of channel members is crucial for determining the retention, training, and motivation decisions. Through evaluation necessary information regarding the channel member is attained. It is essential to evaluate the performance of the channel member on periodic basis. A channel member may have been efficient earlier, but may not be performing well in the present scenario. The reason behind can be dissatisfaction or having inadequate skills and resource to perform. Thus the costs associated and performance levels of members should be evaluated.

17. Modifying the Channel Arrangement Once the channel members are finalised the companies usually do not re-evaluate the intermediaries. This cause potential harm to marketing of the firms. So it becomes necessary for a company to keep modifying the marketing channels as per the changing needs of the market. Some of the major factors are changes in customer preference, competition, market share, and environment factors

18. . Managing the Relationships in Channel One of the key aspects to maximise the revenue and profit is the management of relationships with the channel members. The factors influencing the channel relationship are : Channel Corporation and Coordination. Channel power Channel conflict

19. Channel Corporation and Coordination Corporation and Coordination are the complimentary terms which exist together. The success of a product to a great extend depends on the marketing channel adopted by the firm. It is impossible for a channel to be efficient without coordinating with each other, and for improving Cooperation among the channel members is very important.

20. Channel Power Channel power can be defined as the capability of a channel member that allow him to control the decisions of other channel members in the same marketing channel. Channel Conflict Channel conflict refers to a situation when one channel member compete with the other. This arises when a channel member feels obstructed by another channel member .

21. Reference Marketing Management – Arun Kumar, N. Meenakshi Takur Publications The economictimes.com/channel management

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