Channel Sales: How To Create an Effective Strategy

Yes, I know the people in your sales department are primarily limited, which is one of the biggest challenges you have faced in increasing revenues.

Even if you hire the most focused sales team, invest in resources to boost their effectiveness, and remove all distractions, there is a limited number of hours they can make sales in a day.

You might have had other businesses practicing channel sales for years now, and you want to jump on the bandwagon, but before you jump at this, do you have a channel strategy in place?

If you want your channel sales to be successful, your workforce must understand how the potential channel partners will make sales with the product or services you want them to sell. You should know that it’s not up to the channel partners to figure it out; it is totally up to you.

In this blog post, we will look at the steps that will take your channel sales strategy to the next level.

But before going into the details, let’s take a step back and consider what channel sales is. Whether you call it channel sales, indirect selling, a channel partner strategy, partner marketing, a reseller channel, or a vendor-partner relationship, what does this mean?

What is Channel Sales?

Channel sales is an indirect sales model, also known as a reseller sales model, where manufacturers sell their products to third-party companies – such as referral partners, wholesalers, distributors, managed service providers, or referral partners who resell products to customers.

In other words, you are using someone else’s platform to meet your target audience. This contradicts your organization’s traditional direct sales strategy where the sales department is solely responsible for selling products or services to your customers.

While direct sales depend on your sales reps to grow your business, implementing a channel sales strategy can increase your audience, giving you access to customers who typically would not or cannot patronize your business directly.

A successful channel program will increase your sales significantly, but this is not an autopilot setting. Working closely with your channel partners to use the right plans and strategies would be best.

But with channel sales you can be sure even small businesses can explore new income and revenue streams with their in-house efforts.

Most successful businesses combine channel sales and direct sales to boost sales. For example, an organization might use direct sales to target high-value customers while selling its products or services through retail outlets to reach a mass market.

Let’s quickly look at the benefits of channel sales:

• You can scale your business (even if your internal resources are limited)
• Enter new markets and expand globally.
• Introduce your products to different customers.
• Save a lot of money on distributing, shipping, and web hosting.
• Boost your company’s reputation and name recognition.
• Encourages your sales team to focus on their strengths.

Steps to Create an Effective Channel Sales Strategy

Creating and implementing a channel sales strategy requires research and planning. If you want to adopt more channel sales, you need a process you can always put out and replicate for every partner or channel you pursue in the future. 

Let’s look at the exact steps to creating an effective channel sales strategy

1). Define Your Target Audience from The Start

The first step in creating an effective channel sales strategy is defining your target market.

Who do you want to provide your goods/services to? What needs does your product or service address?

Once you have a clear understanding of your target market, it’s easier to identify the channels that will allow you to reach them most effectively.

2). Research Potential Channel Partners to Make Sure They Are a Perfect Fit

Finding the correct channel partner sounds like a lot of work. Of course, it is! 

In whatever you do, do not settle for the first channel partner who approaches you and vice-versa.

You choose a partner depending on the strategy you opt for. And this makes it subjective concerning your motive. 

It is suggested to develop an image of an “ideal channel partner.” Also, remember to look for one who meets all or most of its requirements. Here are some requirements you should consider for potential channel partners:

• What type of retailer or distributor are they?
• What value do they add to your product? 
• Are they bringing better packaging or faster distribution that increases your sales potential?
• What other products or services do they offer?
• Do they have the same sales ideology concerning upselling, pricing, and negotiation? 
• Do they have an in-depth understanding of your target audience?
•  Are they aligning with your sales process?
• Do they have a large customer base, and so on?

There may be a moment where you’ll be in doubt. In such a case, you can start brainstorming the partners you want to work with or consult within your network.  

3)Connect with Your Shortlisted Channel Partners

Once you have picked out the partners you want to work with, the next thing to do is connect with them.

It would help if you let them know what is in store for them. Remember, channel sales benefits should be beneficiary to both parties.

With this in mind, you should be ready to communicate your thoughts clearly and answer every one of their questions while discussing the agreement. The goal is to build a relationship with them, so don’t shy away from calling them or sending out an email.

4). Entice And Equip Your Partners to Deliver Results

When you find an eligible partner, you need to let them know what is in it for them in a way that motivates them to sell your product or service with the same enthusiasm your direct sales team would.

Sometimes, you must offer competitive incentives such as referral commissions, discounts, or revenue share to convince your channel partners to take your offer seriously and work with you. Just make sure whatever incentive you are offering resonates with their business.

However, you must understand that nothing would entice your partner more than a proper education about your product or services.   

This means educating your partners on the benefits it brings to the users. You can do this in various ways, such as organizing a webinar, offering eBooks, tutorials, etc.

5). Nurture and Grow Long Term Relationships with Channel Partners

Recruiting is critical to a successful partner program, but your strategy should not end when your new partners come on board; channel partnerships are a long-term relationship.

Just like your partners invest their time and skill in learning how to sell your products or services, they also want a partner that will give them support over the years both financially and intentionally.

One of the most impactful ways to do this is through lead generation. Along with sourcing these leads, you can bring them in on open deals and involve them in relevant sales opportunities whenever possible.

Conclusion

There’s no doubt that channel sales is a great way to reach a new target market save time and money. Hopefully, you now know how to create an effective sales strategy to take your product or services to the market, as channel sales may be the winning formula for your business.

Channel sales won’t replace your internal efforts, but a well-crafted channel sales strategy will strengthen and accelerate your stand-alone efforts.

If you are looking for a channel sales partnership platform to help scale up your business, then search no further. Nirvana Sales is at your service.

We have a dedicated team of gifted individuals committed to delivering innovative solutions tailored specifically to meet your business’s unique needs and aspirations.

Contact us today, and we promise you a remarkable journey towards achieving your business goals and unlocking your business’s true potential.