When a manufacturer starts distributing a product, they will never involve only one channel: the more channels, the more sales. Let us take the example of a mobile; you can buy one from an online store as well as an offline store. Similarly, the involvement of several channels takes place in a product, and any disagreement or dispute between these channels can be known as channel conflict. Conflict can also arise between channel partners; these are companies that produce the products and the ones that distribute with a legal partnership between the both.
Types of channel conflict:
If there is a discrepancy or dispute between two channels at different levels in the whole chain, it is a vertical one, as the name suggests—for example, a dispute between the retailer and the manufacturer.
A dispute between two or more parties at the same chain level is a horizontal conflict—for example, a price discrepancy between different sale channels.
The whole chain is sometimes in dispute, which can be termed a multi-level dispute.
The focus, however, is on two of the channel conflicts. The primary two types of channel conflict are vertical and horizontal conflict. Channel conflict can seriously damage your business if not identified and resolved initially. The magnitude of any dispute must be analyzed, and actions must be taken accordingly.
Ways to Avoid Channel Conflict in Marketing
The one truth you need to learn is that conflicts cannot be eliminated or avoided; they need to be handled smartly. Following are a few ways to manage the conflict:
Transparency in pricing strategy
If you price your products fairly across all channels, the channels can put forward their strategy and maintain their profit. However, the truth be told is you cannot fix these channels at a price that they will be using, but if you keep your price straight across these channels, you ensure less, if not none, conflict among the channels.
Keep your channels informed about your product and let them be up to date with the product details. Communication is the key, as they say. Product training for the sales team can ensure a hike in sales.
Brand your store
Consumers today are very competitive and intelligent; they always prefer to check the brand’s website once before making a purchase. No matter where the consumer purchases your product, the win is yours when it is a profitable sale.