Here is a tricky question.  You have to sell one million widgets.  How much of your budget should you spend trying to reach end-users through your channel partners, and how much should you spend on addressing the end-customer directly on your own?

Very few companies are capable of giving any sort of coherent answer to that one, says Erin Anderson: "In most companies it is a case of last year’s budget plus 5%.  It is very hard for companies to come up with a coherent strategy to answer this one."

There are several very good reasons why suppliers find the question almost impossible to answer. Historically, the budget aimed at consumers and the budget aimed at channels have probably been spent by different people. End-user demand is the province of the marketing director/ad agency, whilst the channel manager handles marketing through partners. There may be little or no coherent attempt to measure the effectiveness of channel-marketing campaigns.

Yet there are some principles that can be followed, says Julian Dent, chief executive of VIA International.  He argues that, in general, suppliers with unique products need spend little or nothing on selling through channels.  "With Viagra, Pfizer needed to do little more than public relations and then rely on word of mouth.  Potential customers would then demand the product from pharmacists or doctors, who had no real alternative to offer."

Dent argues that the picture changes as the product becomes more like others already on the market.  "If there is little to differentiate your product from others, then you may want to spend a certain amount on ensuring that influencers and partners are getting at least as much reward from you as they are from your competitors."