When it comes to getting your product into the hands of customers, many new product managers start with the channel. They ask, “Should we sell through partners, go viral, or build a sales team?”
Ben Horowitz puts it simply:
“A properly designed sales channel is a function of the product that you have built and the target … that you wish to pursue.”
In other words, the product and the target market come first. The channel comes later.
Let’s break that down.
Think of the channel as the path your product takes to reach the customer. This path depends on two things:
- What your product does
- Who it is for
If you skip straight to picking a channel without thinking about those two things, you risk picking the wrong path.
Here’s a simple example
You are a PM at a startup called MedTrack. You’ve built a platform that helps mid-size hospitals track the status of equipment like MRI machines, ventilators, and infusion pumps. The product reduces downtime and avoids missed appointments.
Your target market is hospital administrators and biomedical engineering teams. They care about reliability, compliance, and cost savings. They work in regulated environments and require robust data security measures.
Given the product and target, what channel makes sense? Probably not a self-serve website with a credit card sign-up. Your buyers need trust and proof. They may want demos and integration planning.
A better path would be:
- Inside sales teams who can book demos with administrators
- Industry conferences where decision-makers attend
- Partnerships with hospital IT system vendors who can refer your product
Now imagine if you had skipped the product and target thinking. You might have copied a popular startup and gone for a viral, freemium model. That could bring in lots of small clinics or even individual doctors, but your platform is not designed for them. You would spend time chasing the wrong audience.
The lesson is simple.
Start with your product’s strengths and the needs of your target customers. Let those define the best way to reach them. The formula is:
Product + Target = Channel
Not the other way around.
Here’s another quote worth keeping in mind:
“When I ask new entrepreneurs what their distribution model will be… ‘distribute our product like Dropbox did.’ … demonstrates a deep misunderstanding of how sales channels should be designed.”
For new product managers, the takeaway is this: Do not pick a channel because it worked for someone else. Pick it because it fits what you are selling and who you are selling to. That is how you set up your product for growth.