Selling through channel is always a challenge for manufacturers. They often expect the channel to support them in ways that are not appropriate for the channel. Alternatively, with the increasing dominance of category killers in retail, manufacturers look to get favorable treatment (or shelf position) with those retailers. This is a major shift from 30 years ago when manufacturers often dictated the terms to the channel as to what it would take for them to be “allowed” to carry the line.
Unfortunately too many manufacturers spend so much time focused on the channel, they forget that the channel really doesn’t buy anything. They “buy” on behalf of their customers. If their customers don’t buy from them, they won’t buy from the manufacturer. This whole channel issue was reactivated for me based on an article I read in the May 25, 2009 issue of Fortune, “The Wizard of Apps.”
The article discussed the Apple iPhone Apps Store and how difficult it is to get Apple to feature your product in their store. The article noted that for many companies being successful on the iPhone Apps Store was a key to their success in the market. However, they noted that Apple was not very transparent as to how or when they approve a new app for listing and how they decide what apps to feature. New apps try to get featured in Apple’s What’s Hot or New section. This is like trying to get an end cap in Wal-Mart.
The question was asked as to how to catch Apple’s attention? (Like how do I get an end-cap, or how do I get the Home Shopping Network to carry my product?) The answer, “design a must-have app for users, not for Apple. Great apps have a way of bubbling up, and when they do, Apple will take notice.” Gee, design something the customer wants and the channel will notice.
The added benefit to the iPhone store is that, for the most part, they will add any app to the store. Unlike physical stores, they are not limited by space. This is similar to amazon.com, which will carry virtually any book or allow you to open your own store. However, if you want sales you have to create something people want to buy.