Partly due to the rise of B2B eCommerce, many sellers have to deal with channel conflicts. The dilemma? Traditional sales channels (physical store, sales through sales representatives) still bring in the most money, but the rise of eCommerce is too stormy to ignore digital sales.
This changes the sales infrastructure, which can adversely affect the relationship between brand manufacturers, wholesalers and retailers. The brand manufacturer is more likely to sell products directly to the consumer (D2C), sometimes creating a channel conflict as the distributor or retailer is bypassed.
Fortunately, it doesn't have to be that way. In this blog post, we'll show you how to handle this situation and avoid channel conflict.
A fair and consistent pricing policy is the key to maintaining peace between sales channels and partners. For example, brand manufacturers that sell their products at extremely low prices – without offering any additional value – are a major source of channel conflict because they lure customers away from other distributors or chain partners in an unfashionable way.
Therefore, opt for a policy that is based on a minimum advertised price (MAP). This means that you agree on a minimum price that you and your chain partners will not fall under.
Another way to avoid channel conflict in B2B eCommerce is to promote online distributors you work with. Give distributors a prominent place on your website under buttons like 'Find Distributor' and 'Buy Now'.
With a drop-down menu, you also give customers the opportunity to find the nearest distributors at both national and international level. In addition, you can also show which distributors have a platinum status, for example because of their excellent service level or having the largest and most varied product inventory.
Offering unique, exclusive products in your webshop is also a way to reduce the chance of channel conflicts. For example, think of tailor-made shoes, a unique design of a certain product, or a piece of clothing or collector's item that is only available online and exclusively from you. In this way you create a unique brand identity, which keeps you out of the waters of other sellers and chain partners.
Everyone loves free stuff. Handy, because you can use that property of the human psyche to create commercial added value that nips channel conflict in the bud. By adding an extra product to a purchase as a free giveaway, you create extra value without shorting chain partners and other sellers (because they do not sacrifice anything on prices and margins).
A good example of this tactic are the Apple gift cards that the tech giant offers when buying an Apple product during a certain period (start of the school year, vacation, the end of a product run). A variant of giveaways is the compilation of special product bundles or kits at an attractive price.
An eCommerce channel that is easy to find and enriched with good content is a prerequisite for B2B success in the modern retail landscape. Customers are usually looking for a specific product type rather than a particular seller. By putting the tips above into practice, the distributors you work with will also benefit from the successful digital-physical collaboration without fostering this channel conflict.
Moreover, it gives you the chance to take advantage of the growing popularity of B2C, without offending chain partners.