1. Distribution Channels
Teaching Notes

2. Teaching Objectives
• Continue the pace of discovery, customer calls, insights and
critiques
• Make sure your team continues to:
– Annotate their Canvas on LaunchPad Central
– Include diagrams of each part of their hypothesis
– Update their Discovery Narrative
• Focus your main critiques on their understanding of the
customer segments
– Acknowledge that you’ve read their posts
– Comment on egregious parts of the canvas as needed
• Take their temperature
– Are they working well together?
– Any team dysfunctions (if so, LET US KNOW SO WE CAN HELP)

3. How?
• Most teams usually think of customers as the
users of the product
– Make sure they understand there might be
multiple customer segments (users, payers, etc.)
• Make sure their presentation includes a
customer archetype slide and a customer
workflow diagram
– If they can’t draw a “day in the life” of a
customer, then they don’t know enough about
them yet …

4. How?
• Use your critiques to drive them to
understand what pains their customers
havehwat gains they are looking for, and what
jobs they want to get done
– Which features from the value prop will do that?
• Who specifically is (are) the archetype(s)?
• If you can’t draw the customer flow, you don’t
understand it !

5. Common Student Errors
• Not enough customer calls
• Value data from customer calls
– “They like our features …”
• Little to no insight from the data
– “we called on 12 customers and here’s what they
said …”
• Customer segments are not “end users”
• Did not articulate crisp, realistic pass/fail tests
for each hypothesis

6. Take Away from Udacity Lecture
• Students (and their mentors) should
understand:
– Definition of a distribution channel
• Direct Indirect, OEM
– Difference between physical and virtual channels
– Types of physical and virtual channels
– Distribution channel vs. Product complexity
– Distribution Channel Economics

7. Why?
• Many teams confuse channels with customers
• Most do not understand the impact a channel can
have on revenue streams
• The more complex the channel, the smaller the
margins will be
• There is a cost/benefit analysis made when
choosing competing channel alternatives
• Channels are a strategy
– DISCOVERYING THE RIGHT CHANNEL FIT IS AN ART

8. Mentors should emphasize:
• Channels need to match the customer
segments
• Channels need to match the product (and
support) complexity
• Channel economics need to match revenue
goals
• Founders need to sell and close the first few
orders to “prove” the channel …