Channels Aren’t Just About Distribution: The Better Way to Look at Channels

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In the Business Model Canvas, there is a block dedicated to “Channels.” In many of the examples I’ve found on the web, they discuss mostly the distribution channels, i.e. how will you deliver your product to your customer.

But there are at least 5 phases of channels we should be looking at when it comes to thinking about our business. You shouldn’t just be focused on the purchase phase, but also keeping in mind the stages before and after that one.

Why Focus on Channels?

Channels are an important thing to consider before jumping into a new product or business because it helps you determine what you’ll need to prepare, as well as know more about how you’ll be interacting with customers.

Phases of Channels

If you’re at all familiar with funnels, these stages do model that of a conversion funnel as well. And for good reason, they’re essentially the same thing, but we are just looking at them in a different way.

When building a funnel, you look at what customers want at different stages. Here, we are looking at where customers are at these different stages. When I say where, I literally mean, which platforms are they on, how can we reach them, etc.

Phase 1: Awareness

The Awareness Phase is Phase 1, and it helps determine how you are going to build awareness for your business and what you do.

Some examples of awareness phase channels can include:

  • Google and other search engines
  • Places you product content for (i.e. YouTube, Instagram, Facebook)
  • Sites you guest post on or are featured through

Phase 2: Evaluation

This is the phase where potential customers will continue to do more research about you, maybe go through a trial period if you have one, and read reviews about your business.

This phase presents a huge opportunity for you to help educate people about what you’re doing and why you are the best fit for them. Putting out content about your product and how it can help people is great, but you also have to make sure people can find it.

Examples of these channels can include:

  • Yext
  • Google My Business
  • Social Media accounts
  • Your website
  • Accounts you have on partner sites like eBay or Amazon

Phase 3: Purchase

This one is quite self explanatory. How will you be presenting people with a way to exchange money for what your offering?

Examples of channels to think about:

  • Merchant Accounts
  • Stripe, Paypal, etc.
  • Invoicing platforms

Phase 4: Delivering Value Proposition

This phase is a very important one as well. How are you going to be delivering your product or service to the people who decide that you are the solution to their problem?

This is also known as the fulfillment stage of the process.

Some examples of this phase include:

  • Delivery system for electronic information products – Gumroad, etc.
  • Postage/Mail – UPS, FedEx, USPS
  • Email service providers

Phase 5: Post-Purchase Support

This is where your customer service team, or the customer service hours you set aside for helping people is going to come into play. How will you be providing support to people who have purchased from you? Are you going to be delivering a series of emails to help them through the process as the days pass?

In addition, will you be offering a discount for them if they refer you clients?

Examples of channels for this phase include:

  • Email service providers
  • Customer service platforms like Drift or Intercom
  • Chat platforms like Facebook messenger, or

Types of Channels

Direct Channels (i.e. The Ones You Own)

Direct channels are those that you own or have control over. This could be your store, website, or sales team.

These channels allow you to have a direct relationship with the customer, which usually leads to you garnering higher margins because you’re not paying affiliate and other fees.

While there is generally more upfront cost to these channels, the return is usually well worth the time and money you put into them.

Examples by Phase

  • Awareness: Your website
  • Evaluation: Your website could be one place they evaluate your business through.
  • Purchase: Your store or website
  • Delivery: Your store or website
  • Post-Purchase Support: Phone, store, or website

Indirect Channels (i.e. Partner Channels)

These are called partner channels because you are selling your product or service through an intermediary.

Examples by Phase

  • Awareness: Your social media accounts; interviews you are part of on other people’s channels or websites.
  • Evaluation: Your social media accounts; Yelp listing; Google My Business account, etc.
  • Purchase: Channels you sell through but don’t own, i.e. Etsy, Amazon, eBay, etc. Maybe you sell products out of a partner’s store, those would be indirect as well. If you sell through a wholesaler, they could be part of your purchase channel as well.
  • Delivery: Maybe you’re selling your products through an online service like Gumroad, or Amazon, these would be indirect channels
  • Post-Purchase Support: Social media channels or review pages where people ask questions or leave concerned reviews.

I didn’t list all of those out to force you to think about each one, because some of them might be the same as others. The idea is to understand the phases and some of the channel types so you can determine what your specific business will need in the beginning.

I want you to list out all of the channels you’ll need to interact with so you can start building those into any processes you create.

I find this exercise super helpful in determining platforms you’re going to need relationships with in order to do business successfully.

As always, these can, and likely will change as you progress in your business.

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