These channels are the ones that take products from the manufacturer’s facilities to the end consumer. However, they shouldn’t be confused with transport companies that, for example, deliver the orders placed in an ecommerce store. In fact, distribution channels are made up of:<\/p>\n\n
\u25cf Producers<\/strong> – Agents that manufacture the product.<\/p>\n\n \u25cf Wholesalers<\/strong> – Those who distribute to stores.<\/p>\n\n \u25cf Retailers<\/strong> – Those who bring the product to the end consumer.<\/p>\n\n A company’s distribution channels have a positive influence on its sales. They allow a given product to reach a wider audience.<\/p>\n\n An effective distribution channel makes it possible for a given product or service to reach a larger number of customers.<\/em><\/strong><\/p>\n\n Email, your most profitable distribution channel<\/strong><\/p>\n\n\n\n Of all distribution channels, email marketing stands out for its high return. Discover it with Mailrelay.<\/p>\n\n\n\n As you can imagine, not all distribution channels are the same. There are several types and even several classifications. Below, we’ll look at the following:<\/p>\n\n 1.- Direct and indirect distribution channels. <\/strong>A classification based on the type of agent that bears responsibility for distribution.<\/p>\n\n 2.- Channels by line of business.<\/strong> A classification that offers several types of distribution channels depending on the line of business or industry.<\/p>\n\n 3.- Distribution channels in digital marketing. <\/strong>The third one covers distribution channels applied specifically to digital marketing.<\/p>\n\n 4.- Channels by technological level. <\/strong>And the last one refers to distribution channels according to the sales technology used.<\/p>\n\n The first classification of this concept makes a clear distinction between a company’s own distribution channels and third-party ones. Here we find:<\/p>\n\n When a distribution channel is direct, it means that it belongs to the same company in charge of production. In other words, the manufacturers themselves deliver their products to consumers.<\/p>\n\n To do this, they need to have warehouses and a suitable transport service. Its main advantages are:<\/p>\n\n \u25cf Lower costs.<\/p>\n\n \u25cf Higher business profit margin.<\/p>\n\n \u25cf Greater control over the process.<\/p>\n\n \u25cf Easier problem resolution.<\/p>\n\n \u25cf Direct contact with the consumer.<\/p>\n\n In this case, we’re talking about different companies. In other words, producers and distributors are not the same company. Depending on the number of agents involved, or the channel’s length, we find:<\/p>\n\n \u25cf Double channel.<\/strong> This is the longest one: it adds an exclusive agent between the producer and the wholesaler, such as an importer or a representative with exclusive rights in an area. The route is producer \u2192 exclusive agent \u2192 wholesaler \u2192 retailer \u2192 end consumer. It’s common in international trade.<\/p>\n\n \u25cf Long channel.<\/strong> Both the wholesaler and the retailer are involved: producer \u2192 wholesaler \u2192 retailer \u2192 end consumer. The product is sold three times before it reaches the customer. It’s the typical channel for food and household goods, where many small stores need to be reached.<\/p>\n\n \u25cf Short channel.<\/strong> It skips the wholesaler: the producer sells to the retailer, and the retailer to the end consumer (producer \u2192 retailer \u2192 consumer). With fewer intermediaries, the product arrives sooner and with fewer added margins.<\/p>\n\n We can say that the indirect distribution channel can boast:<\/p>\n\n \u25cf Wide coverage.<\/p>\n\n \u25cf Specialization.<\/p>\n\n \u25cf Good logistics support.<\/p>\n\n \u25cf Speed.<\/p>\n\n \u25cf Organized sales.<\/p>\n\n \u25cf The option to expand stock.<\/p>\n\n Both distribution channels have their pros and cons. Choosing one or the other will depend on the nature of the business and the resources available.<\/em><\/strong><\/p>\n\n On the other hand, if we look at business activity, we can also find different types of distribution channels. Two, to be precise: the first goes from the producer to the industrial customer, and the second goes from the producer to industrial distributors.<\/p>\n\n \u25cf Channel 1:<\/strong> from the producer to the industrial customer. This channel is specific to this activity and connects the producer with the industrial consumer.<\/p>\n\n \u25cf Channel 2:<\/strong> from the producer to industrial distributors. These are the ones we called wholesalers earlier. They take part in the process to buy a given product and then sell it.<\/p>\n\n When it comes to digital marketing, these distribution channels are digital routes through which different services can be offered. They are the ones we can use to provide better service to our customers.<\/p>\n\n By better service we can mean: giving the consumer more information before the purchase, making customer service easier, offering interactive, faster and more accessible solutions, simplifying purchase processes\u2026<\/em><\/strong><\/p>\n\n In this sense, for Philip Kotler<\/a>, a good marketing strategy is key to managing distribution channels.<\/p>\n\n Specifically, the following are considered digital marketing distribution channels:<\/p>\n\n \u25cf Valuable articles and content.<\/p>\n\n \u25cf Communication on social networks and other apps.<\/p>\n\n \u25cf Digital advertising on different platforms.<\/p>\n\n \u25cf Search engine optimization of web content (SEO).<\/p>\n\n Regarding this last channel, working on SEO, or organic positioning, will make it easier to find information and access certain products or services.<\/p>\n\n All distribution channels in digital marketing make it easier to access specific products or services, and they do so by generating valuable content.<\/p>\n\n Reach your customer through the right channel<\/strong><\/p>\n\n\n\n Automate and personalize your emails so that every distribution channel works better with Mailrelay.<\/p>\n\n\n\n This classification of distribution channels looks at the technological means that the different agents use to bring the product to the end consumer. These are:<\/p>\n\n \u25cf Electronic media.<\/strong> These are channels based mainly on the internet. They also use the telephone and other computer tools.<\/p>\n\n \u25cf Audiovisual media. <\/strong>For example, teleshopping is one of the business models that use this distribution channel. On the one hand, certain information is broadcast on television; the telephone is used to stay in contact with the buyer and take orders; and a transport company delivers the purchase.<\/p>\n\n \u25cf Automated media.<\/strong> These are channels where the sale is made without staff, supported by technology: vending machines, ATMs, self-service stores or pickup lockers.<\/p>\n\n \u25cf Traditional media.<\/strong> To close this group, we mention the channels that are unconnected to new technologies or communication networks.<\/p>\n\n Email is still one of the best communication channels today. Why? Speed, privacy and two-way communication. Hardly any other channel offers all of this. Social networks are losing ground because of their algorithms, SEM keeps getting more expensive, and SEO has lost much of its strength because of AI answers, which, although very useful, reduce the traffic that reaches websites. So email is still one of the channels that will give you great visibility at a low price. Effectiveness and affordability: what more could you ask for?<\/p>\nJose Argudo<\/strong>, CMO at Mailrelay<\/cite><\/blockquote>\n<\/div><\/div>\n\n From the previous paragraphs, we can deduce that there are different types of distribution channels. Understanding them may be simple, but when it comes to choosing one, things get complicated.<\/p>\n\n To make the right choice, we need to take into account the criteria I’ve listed below.<\/p>\n\n This matters because not all the channels we’ve described suit every product. It’s important that the chosen channel fits the company’s strategy, as well as its vision, mission and sales objectives.<\/p>\n\n In other words, the ideal is to choose a distribution channel that brings something positive to the consumer. To do this, you need to analyze customers’ expectations very carefully.<\/p>\n\n Some will want to talk to the company, others will want to see the product up close, and others will want to place their order in one click without any hassle. All of this must be taken into account to choose the right distribution channel.<\/p>\n\n This is one of the factors companies value most. But\u2026 what type of channel will respond best? Some products are unquestionably better offered through direct channels, while others see more advantages in indirect ones.<\/p>\n\n Nowadays it’s common to find companies with several distribution channels operating at the same time. Most often, this means one channel focused on online sales and another retail one.<\/p>\n\n In this case, they can coexist, but you have to prevent them from conflicting. The strategy you implement must respect each one’s place.<\/p>\n\n Whatever distribution channel you choose, it must be monitored and tracked to manage the supply chain properly.<\/em><\/strong><\/p>\n\n As you can see, there are different types of distribution channels, although they all pursue the same goal. Let’s look at some examples to better understand the meaning of this concept. We’ll focus on direct and indirect channels.<\/p>\n\n If we think of direct distribution channels, we can give the following examples:<\/p>\n\n \u25cf Banking. <\/strong>Banks create financial or banking products that they make available to their customers directly. There are no other intermediaries.<\/p>\n\n \u25cf Farmers.<\/strong> Some professionals in this sector sell what they produce directly at food markets, organic markets or fairs. Again, we’re talking about businesses with a direct distribution channel.<\/p>\n\n \u25cf Textile companies. <\/strong>Companies like Zara are both manufacturers and sellers of their own products.<\/p>\n\n On the indirect distribution channels side, we can find cases like the following:<\/p>\n\n \u25cf Automotive companies. <\/strong>For example, Hyundai. This brand has a factory that sends its products to the retailer, who sells the cars to the end consumer. This would be a short distribution channel.<\/p>\n\n \u25cf Ecommerce.<\/strong> Amazon is another well-known example of an indirect distribution channel. It’s a marketplace that receives products from certain manufacturers and takes care of delivering them to the end customer.<\/p>\n\n \u25cf Small stores. <\/strong>We’re talking about grocery stores or neighborhood shops. In this case, they are examples of long indirect distribution channels, since they need a wholesaler to receive the products.<\/p>\n\n \u25cf HORECA.<\/strong> The same thing happens in this sector. Restaurants and bars need to buy their products from wholesalers to bring them to the end consumer. For example, the products they always buy are drinks or snacks.<\/p>\n\n \u25cf Franchises. <\/strong>In the case of food franchises, we’re talking about a double indirect distribution channel.<\/p>\n\n \u25cf Travel agencies. <\/strong>Again, the previous model is repeated. In both, a special agent is involved between the manufacturer and the wholesaler.<\/p>\n\n In short, one possible scenario is that the manufacturer decides to sell its products to the consumer without going through intermediaries. For example, if a company makes clothes and sells them directly to its customers from its ecommerce store, we’re talking about a direct distribution channel.<\/p>\n\n Another scenario would be that the same company used a network involving wholesalers and retailers. In that case, we’d be looking at an indirect channel.<\/p>\n\n In this sense, wholesalers are usually the intermediaries who buy a considerable volume of product to sell it to retailers, who then sell it to the end user (although the wholesaler may also sell directly to the end customer).<\/p>\n\n In the end, the decision will depend on the strategy each company wants to follow. That’s why knowing about distribution channels is so relevant to business marketing.<\/p>\n\n I hope these examples have helped you better understand what a distribution channel is. With that said, could you identify what types of distribution channels the businesses around you use?<\/p>\n\n If your distribution channel includes the digital environment, it will be useful to learn more about digital marketing<\/a> and the role email marketing<\/a> plays there as a direct channel with your customers.<\/p>\n\n Your choice of channel should also go hand in hand with a good pricing<\/a> policy, since both are part of the same marketing mix<\/a>.<\/p>\n\n Boost your distribution strategy<\/strong><\/p>\n\n\n\n Add email marketing to your channel mix and multiply your results with Mailrelay.<\/p>\n\n\n\n Target market: definition and classifications<\/a><\/strong> Product life cycle: stages and examples<\/a><\/strong>![\"Types](\"https:\/\/mailrelay.com\/wp-content\/uploads\/2017\/05\/consejos-email-marketing.jpg\")
<\/figure>\n\nTypes of distribution channels of a company<\/h2>\n\n
1) Direct and indirect distribution channels<\/h3>\n\n
Direct channels<\/h4>\n\n
Indirect channels<\/h4>\n\n
![\"Distribution](\"https:\/\/mailrelay.com\/wp-content\/uploads\/2018\/01\/marketing-relacional.png\")
<\/figure>\n\n2) Distribution channels by line of business<\/h3>\n\n
3) Distribution channels in digital marketing<\/h3>\n\n
4) Distribution channels by technology<\/h3>\n\n
![\"How](\"https:\/\/mailrelay.com\/wp-content\/uploads\/2017\/03\/mobile-marketing.png\")
<\/figure>\n\n\n
How do you know which distribution channel is best?<\/h2>\n\n
Type of product<\/h3>\n\n
Added value<\/h3>\n\n
Speed<\/h3>\n\n
Compatibility<\/h3>\n\n
![\"Examples](\"https:\/\/mailrelay.com\/wp-content\/uploads\/2016\/04\/marketing-en-redes-sociales.png\")
<\/figure>\n\nExamples of distribution channels<\/h2>\n\n
Recommended reading<\/h2>\n\n\n\n
![\"Teresa](\"https:\/\/mailrelay.com\/wp-content\/uploads\/2016\/07\/teresa-alba.jpg\")
<\/figure>\n","protected":false},"excerpt":{"rendered":"