This article is an excerpt from the Shortform book guide to "Guerrilla Marketing" by Jay Conrad Levinson. Shortform has the world's best summaries and analyses of books you should be reading.
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What are the five types of marketing channels? How should you choose one for your products or services?
Choosing the right marketing channel is important for the success of your advertising campaign. Marketing guru Jay Conrad Levinson says you can save time, money, and frustration by using his method to choose the best channel for marketing your business.
Read on to learn the five types of marketing channels and how to choose the right one, according to Levinson.
Types of Marketing Channels
According to Osterwalder and Pigneur (Business Model Generation), all business ideas fit into one of five types of marketing channels—each requiring a specific marketing approach to reach customers.
Let’s explore the five types of marketing channels they identified:
Mass Market: You’re selling to one large customer base with similar needs—you need to appeal to and engage as many people as possible. For example, Colgate benefits from advertising in the mainstream media because toothpaste is an essential, widely used personal care product that everyone needs.
Niche Market: You’re selling to a small customer base with unique requirements—you need to target these specialized needs. For example, Lush targets customers who care about vegetarian products and eco-friendly practices, so its social media strategy focuses on engaging “green” customers.
Subdivided Market: You offer slightly different products and services, so you need to employ different types of marketing channels to reach different customers. For example, a real estate broker’s customers each have different budgets. The broker may spend more time and resources attracting and developing relationships with wealthy clients looking to buy and delegate management of lower-income renters to employees.
Diversified Market: You offer distinctly different products and services to unrelated customer groups, so you have to employ separate customer-targeting strategies. For example, Johnson & Johnson provides healthcare products to customers as well as medical devices and equipment for hospitals—they need to reach both groups separately.
Multi-Sided Market: You serve interdependent customer groups so your approach needs to appeal equally to both parties. For example, online marketplaces need to appeal to and accommodate both buyers and sellers to operate efficiently—they can’t serve one group without the other group’s active participation. They need to reach and appeal to two different groups with one marketing message.
If you already have a product or service that you intend to sell, consider which of these five types of marketing channels your offer falls into and how you can align your strategy to reach as many people as possible. Or, if you’re looking for a business idea, choose a market based on which strategy most appeals to you. Then, focus your research on products and services that fall into your chosen market.
Choosing Your Channel
Large businesses commonly rely on different types of marketing channels that require a big financial investment, such as television and radio commercials, newspaper and magazine advertisements, direct mail, and billboards, to reach as many potential customers as possible. Levinson argues that, while this approach does allow businesses to reach a large audience, their approach is untargeted—meaning that they attempt to appeal to customers who have no interest in purchasing what they’re offering. And since marketing to uninterested customers doesn’t generate sales, this approach is ineffective and often results in financial loss.
(Shortform note: Psychologists offer a contrasting opinion: Advertising to uninterested people can generate sales. This is due to the mere exposure effect—the premise that the more often you’re exposed to something, the more you like it. Research suggests that regular exposure makes a product easier to interpret and reduces the uncertainty you feel about it—thus increasing your confidence in it. And your increased confidence influences you to purchase this item. However, the mere exposure effect doesn’t work for things you initially dislike—it tends to only work if your initial reaction to something is neutral or positive. For example, if you dislike Cheerios, regular exposure is unlikely to convert you into a paying customer.)
Levinson argues that, instead of trying to emulate this mass-market approach, you should focus only on the media that your target market engages with the most. Use the research material you gathered during your target market research to help you choose from the different types of marketing channels.
For example, you defined the target market for your ergonomic desk chairs as a group of customers that work from home, suffer from back pain, and shop online. Your target market research revealed two things: First, your target market visits a specific group of chatrooms to find solutions to relieve their back pain. Second, your target market relies on a specific group of online stores to make purchases.
Therefore, you focus your marketing efforts on these chatrooms and online stores to reach your target market.
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- Why you don't need expensive mass-media marketing campaigns
- How to create a profitable marketing message and strategy
- How to define your target market and keep costs low
