Riding the Wave: Channel Strategy Alternatives
Whitepaper summary:
Customers learn more about how to buy, use and support products as markets evolve, causing the channel’s role to change. The figure above illustrates the evolution from high valueadded, high gross margins to low value-added, low gross margins.
The problem for managers is that channel organization does not necessarily evolve with the market. In the event that new technologies are brought to the market, creating the need for new, high value-added channels, the average distributor, sales representative or retailer remains the same. Instead of changing their strategy, they find other things to sell that require the same type of selling they always have. This results in lost market share.
