Channel Profitability

Channel profitability, simply defined, is the difference between the revenues earned from, and the total costs associated with, a channel over a specified period of time. Typically a very small percentage of your firm’s best channels account for a large portion of your net profits. Conversely, a small percentage of your channels usually cost more to offer than the revenue they deliver. These unprofitable channels detract from overall firm profitability. Profit winners and profit losers are a natural consequence of the variability in the revenues and the true costs related to channels. With channel profitability insight, you benefit from knowing which channels create value, which destroy value and why.

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