Distribution Channels

Distribution Channels refers to the down stream activities of your business. Its about ways to:
  • reach out to your customers (marketing), 
  • communicating with them to make them aware of their needs (communication)
  • building a reputation as the preferred satisfyer of those needs (communication)
  • convincing your customers to buy into your value proposition (sales)
  • delivering your goods and services to your customers (fulfilment)
  • invoicing and collecting payment (debt management)
  • service (reputation management)
  • recycling (cradle to cradle, sustainability)
The steps are also described in the customer journey, but now you describe how you wil manage and execute these steps (either you do it yourself or you outsource the task) enter the results in "distribution channels" in the Business Model Canvas. 

Example marketing & distribution channels:

I am a manufacturer of water purifying systems for expert home use that can purify large quantities of water (upto 2m3/day).

The system is not sold to consumer directly. Its installed by professional installers, but they are not "selling" the system, they just install it.

The system is "sold" by special sales agents (water treatment experts) and specified by architects and contractors in their building specifications upon request of the new owners of the building.

So we need to reach out to our customers through social media campaigns, ad-words, trade shows, articles and advertisements in magazines and word of mouth (attention). When customers show interest we try to lead them to our website to provide additional information and lead the potential customers to the specialised (sales) agents (interest). When the sales agents convinces the customers the need a water purifying system and ours is the best desire), they close the sale (action) and contact the architects or contractors to specify the appropriate systems. Our sales agents make sure the systems are delivered at the right moment and check proper instalment by installers (delivery). The sales agent invoices the contractor or installer. After sales the sales agent inspects the system once a year and exchanges the filter components when necessary (satisfaction).

We need to pay for (on-line) marketing and our website and we pay commission to the sales agents for the sales and service, we pay commissions to the architects and contractors for specifying our product and we pay the installer for installing the system properly.

More information:

Introduction by Steve Blank about Distribution Channels