21. Sales Channels


Reaching customers, directly or indirectly

How does your sales team communicate with your potential customers? Those methods of communication are called your sales “channels.”

There are three general types of channels:

  • Direct
  • Indirect
  • Online

“Direct” sales are when the salespeople are employees of your company. The employees directly communicate with the potential customers, either in person, on the phone, via email, or through some other direct communications channel.

In “indirect” sales, the salespeople work for a different organization. The most common example of this is a product sold via retailers. Your salesperson sells to the retailer, and the retailer puts your product on a shelf to be sold by their clerks to the end consumers.

“Online” sales use no salespeople. Instead, the products or services are listed on a website, and the customers make purchases without any additional conversations from your or anyone else’s salespeople.

Of these three choices, direct sales is usually the most expensive, and online, the least expensive. However, the goal of sales is not to minimize expenses. The goal is to maximize revenues.

For startups, even those with online services, it is best to start with a direct sales model. The reason for this was discussed back in the chapter on customer feedback. It is critically important to know why customers are choosing not to buy. A direct sales team is the only one of the three channels that provides any opportunity to collect that information.

If your product is sitting in another company’s store or is one of many parts of another company’s product or is being resold by another company’s sales team, then you can’t talk to the customers. Even worse, you probably can’t measure the sales funnel (described in the next chapter) or make changes to the sales process.

This is true for online sales, too. True, you can measure how many people visit your website. You can gather some information about the search terms they used to find it or articles and advertisements they clicked to reach it, but when visitors leave without buying anything, you can’t ask them why.

Thus, for nearly all startups, despite the cost, the best choice is direct sales, so you can learn all about your customers by talking to them.


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