Channel stewardship is the most effective way to succeed in channel dependent businesses, especially when combined with other management solutions. Nowadays, most of the high-tech companies are interested in investing significant amounts of money to promote and sell products and services through partner portals and channels. However, such a multi-channel strategy is difficult to oversee, hence the crucial role of channel stewards in the distribution chain.
A steward is typically the dominant company in the channel value chain and has the responsibility of proactively participating in the design and execution of a company’s go-to-market strategy. They expand the internal framework that enables the various partners and end users to do business more easily and efficiently. This move increases brand value, market share and profitability. The stewards’ role relies on critical elements such as coordination and influence; the different roles in the channel distribution network; excellent response to the demands and needs of end users; and return of investment and margins to all distributors. But what are the specific strategies that stewards employ to ensure effective channel management?
Channel stewardship uses three strategies: partner portals, eMarketplace and volume channel.
• Storefront or eBusiness Partner Portal – This strategy gives companies the ability to create portals that are tailored, customized, or personalized specifically for channel members and their customers. These portals enable partners by offering self-service tools that can be used to browse catalogs, research product information and details, configure solutions, view change orders, track shipments, and receive payment invoices. In addition, they provide a range of product catalog and pricing information based on partner and customer needs. It is deeply integrated with the channel sourcing system. Typically larger clients and affiliates prefer this approach.
• eMarketplace – The fact of the matter is that proposing partner portals for each reseller is expensive and impractical. Therefore, it is crucial to reduce the number of product segments through standardization of platforms and functional modularization. These would then be offered through an eMarketplace best suited to organizations that are upstream in their value chain. This strategy is typically beneficial for mid-market companies serving small and medium-sized businesses, as it provides a single platform for order fulfillment and offers flexible ways for partners to bundle products with various accessories, services, and the like.
• Volume Channel – This approach focuses on the efficiency of operations in distributing product knowledge and the seamless process of quote orders and returns. To ensure the successful implementation of the model, it is important to consider the key elements that include reduced complexity and breadth of products offered, high partner and customer self-service, and close monitoring of key performance indicators and distributors and ODM/ CM are Service Level Agreements. This is most useful in scenarios where the complexity of the products is low.
The real challenge, however, is choosing the right strategy or approach. This requires a thorough evaluation of each company before a decision is made. The choice should be based on a framework that depends on factors such as the relative size and dominance of partners and customers, existing business relationships, and product complexity.