If you’re selling a consumer product, it is very easy to become confused with who the actual customer is. If you make a product that you only sell directly to consumers at a website for example, then your Customer is always the end user. If you sell a product that is purchased and resold in stores or through distributors, your Customer is NOT the consumer, it is the reseller of your product. That’s where YOUR money comes from.
Making a great product is the minimum standard to be in business. Many founders and creators think that is the entire goal of the business. They are correct that this is the top priority. But, if you sell your product to a reseller, be it a store, a website, a distributor, a franchisee, they will have a very different set of reasons to work with you and your product. It’s about the money!
Since the retailer is buying your product and paying your bills (not the consumer, the consumer is paying the retailer’s bills) and you want to keep your product in their store, you have to figure out how to meet the retailer’s needs. Therefore, the retailer is your Customer. Meeting their needs IN ADDITION to making a great product is your mission.
Add a distributor, who makes an even greater commitment to your product by stocking it in a warehouse and selling it to their dozens if not hundreds of retailers that are their Customers and the equation becomes far more about business, reliability and trust and less and less about product.
In each of these levels, the dialogue has been changed from “what is your product” to “how much money will I make with your product”.
Understanding the roles and expectations of your channel partners, and working to make them successful with your wonderful product is exactly what creates longevity. If you can’t help them make money, your product will not be long for their business. At the beginning and in the end, all of our businesses are in business to make money. Only the consumer/user is buying the product to meet the purpose of the product.
Ever wonder why it is so hard for the “new guy” to break into the market? It is simply because there is no reason (yet) to believe they understand the importance of the money equations that underpin the entire effort. The evidence that they do, is to reliably produce results for whatever reseller is open enough to entertain the “new guy”.