Channel Management Matrix

The Channel Management Matrix is a strategic tool used to evaluate and optimize the performance of different distribution channels. It helps businesses identify which channels are most effective in reaching their target audience and achieving sales goals, thereby enabling better resource allocation and strategic planning.

At a very high level, the Channel Management Matrix is used in the context of business, marketing.

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What is the Channel Management Matrix?

A visual explanation is shown in the image above. The Channel Management Matrix can be described as a matrix with the following quadrants:

  1. Stars: High performance and high potential channels, e.g., a rapidly growing e-commerce platform.
  2. Question Marks: Low performance but high potential channels, e.g., a new social media sales channel.
  3. Cash Cows: High performance but low potential channels, e.g., a well-established retail store with steady sales.
  4. Dogs: Low performance and low potential channels, e.g., an outdated catalog sales channel.

What is the purpose of the Channel Management Matrix?

The Channel Management Matrix is a valuable framework for businesses looking to analyze and improve their distribution strategies. This 2x2 matrix evaluates channels based on two key dimensions: Channel Performance and Channel Potential. Channel Performance assesses how well a channel is currently performing in terms of sales and customer reach, while Channel Potential evaluates the future growth opportunities and scalability of the channel.

By plotting channels on this matrix, businesses can categorize them into four quadrants: Stars, Question Marks, Cash Cows, and Dogs. Each quadrant represents a different strategic approach:

  • Stars: High performance and high potential channels that should be invested in for growth.
  • Question Marks: Low performance but high potential channels that require further analysis and potential investment.
  • Cash Cows: High performance but low potential channels that should be maintained for steady income.
  • Dogs: Low performance and low potential channels that may need to be divested or restructured.

Use Case: A retail company might use the Channel Management Matrix to evaluate its online store, physical retail outlets, and third-party e-commerce platforms. By categorizing these channels, the company can decide where to allocate marketing budgets, which channels need improvement, and which ones might be phased out.


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What templates are related to Channel Management Matrix?

The following templates can also be categorized as business, marketing and are therefore related to Channel Management Matrix: Product-Market Matrix, 4 Ps Marketing Mix Matrix, AI Capability-Value Proposition Alignment Matrix, AI Innovation-Value Alignment Matrix, AI Maturity Matrix, AI-Value Proposition Alignment Matrix, AI-Value Proposition Matrix, AIDA Marketing Matrix. You can browse them using the menu above.

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