Synopsis: OEM Electronic Components – Channel Strategy
A manufacturer of electronic components used in cell phones to laptops knew other mobile electronic devices could benefit from their components. Their direct sales force had great relationships with their customers, but were spread thin helping customers incorporate their components into the next generation of products. After brainstorming all the potential applications, management saw the potential growth opportunities – and the costs and distraction they faced chasing unproven opportunities.
The OEM asked QDI to assess the market opportunity and where there where opportunities to identify the best go-to-market strategy for each segment. We realized that these two projects could be combined saving the money and time to market.
Using the OEM’s advanced solutions from the cell phone and laptop markets to open the conversation QDI found engineers in prospective markets willing to discuss whether these might have value in the products the engineers were currently designing. The conversations then naturally move to what would be the best way to bring these solutions to the engineers.
Using QDI’s technology screens we were able to identify the segments that were interested and more importantly ready to adopt our client’s solutions. Analyzing the second half of our conversations it was clear that there were manufacturer’s reps and distributors that already had good relationships with the engineers and would be trusted sources for introducing these technologies.
For several segments, the client was able to select manufacturer’s reps that could provide a much faster time to market than ramping up additional sales people and working to establish relationship with new accounts. Other markets were interested in the new technologies, but preferred to purchase standardized products at lower volumes through distribution. Our client decided to sell standardized products through these distributors which provide a much more cost efficient way to reach this portion of the market.
Since the work showed that these channels served these different customers and had minimal overlap our client add select channels without creating conflict with the direct sales force or with other channels. Our client was able to reach multiple industries and different types of buyers (custom versus standard components) through 3 types of channels.
This in-depth project pinpointed the channels that would maximize the firm’s reach and revenue growth on a limited budget while also speeding their entry into these new markets.