For some years we have tracked the growing importance of indirect channels. Research data shows that channels have become the primary source of revenue in the high-tech industry and new research from Miller Heiman shows the use of multiple simultaneous routes to market is growing rapidly in other industries too as more and more manufacturers try to reduce their cost of sale and extend their market coverage to small and medium business and high growth geographies and markets.
Low growth in traditional domestic markets has forced recalcitrant vendors to focus on new markets and on-going rapid growth in emerging economies. Procrastinating vendors are left struggling to catch up with more nimble competitors, as they come to the realization they need a new approach to cover markets in which they have no experience, no presence, and in most cases don't even speak the language.
The basic rationale behind channels is to transfer the cost of sales away from the vendor to other partners. If a vendor can cover the entire market opportunity themselves, and do so at a lower cost that working through indirect channels then the vendor should do so. However most companies operating on a global basis just can't cost effectively hire and train enough sales people to cover the whole market. Let alone add all the other products and services that are necessary to create an end-user solution.
This chart displays some recent data from Miller Heiman's sales best practices study.
For some years we've tracked those companies who say they only sell direct. Look how the number has changed in the last few years. Put differently, 72% of Miller Heiman customer respondents now say they do business through multiple routes to market! So the bottom line is, the move to a multi-channel world is growing FAST! Channels are the high growth focus area in many companies.
Coinciding with this trend is the recognition by many that channel-sales requires different skills and processes than direct sales, and that channel management is a profession in its own right.
So if you are a well-educated and experienced channels professional your skills are in demand!
