The right channel strategy?
It really starts with your definition of your target consumer
with a fashion sense then your
primary retail customer should probably be Target Stores.
If you think your product is for females with a fashion sense then you primary retail customer should be: Target.
If you products needs to be sold and explained and have a stronger appeal to a male consumer you need to consider Best Buy
Another consideration is the level of distribution you want to achieve. How many store fronts do you really need? Value perception plays a role in your channel selection. Channel partners like Wal-Mart or Kmart are great companies but they are not business developers. They will usually wait until a product category has matured and consumers demand has increased before they plan to assort them.
Wal-Mart positions their stores in more suburban / rual areas and usually avoid city centers or areas with high income demographics.
Insert Picture: Wal-Mart store
Selling to warehouse clubs is another great sales opportunity but it also poses some challenges. Because clubs charge a fee for membership they expect vendors to provide them with special value. In turn Clubs will work on a lower retail margin then other retailers. The special value that vendors have to provide is typically Price.
Even when you create special packaging and / or bundles it does impact the pricing of your core product and may cause other retailers and e-commerce sites to react!
Another challenge are e-commerce partners that provide a market place such as Amazon.
The market place provides a forum for 3rd party retailers to sell your product. This is very difficult to control and requires great discipline managing your distributors and opportunistic sales channels.
Amazon has an automated price screening mechanism – that scans competitive sites for pricing and will adjust their prices when they find evidence that other sites have a lower price on products. They will also scan their own market place and match pricing for your product. Keep in mind Amazon is the most visible retail destination and generally has a significant impact on the sales success of a product. Amazon is probably the #1 reference point for consumers to check on a price and quality of a product.