Distribution and acquisition channels

Poor distribution — not product — is a leading cause of failure. A mediocre product with a working channel often beats a beloved product trapped in a private Slack of early adopters.

Distribution is the set of channels that repeatedly put your product in front of people who can buy. GTM strategy picks the motion (PLG vs sales). This section is the catalog of how demand shows up, how to test cheaply, why channels saturate, and how to build assets you own. Economics always loop back to CAC and payback and to product growth loops.

Most startups get zero channels to work. Nailing one is enough. Spraying a little sales, a little ads and a little viral is how you get zero.

A math hole, worked out

Paid search converts at 2% click→trial and 10% trial→paid. Target CAC is $400. Max CPC = $400 × 0.02 × 0.10 = $0.80. If auctions clear at $2.50, this channel cannot work until conversion or ACV rises. That arithmetic is channel-market fit.

Concepts in this section

Step	Concept	What it answers
1	Channel-market fit	Can this path reach our ICP at a CAC we can bear?
2	Acquisition channels	What are the options, and how long to learn each?
3	Bullseye	How do we test cheaply and focus on the winner?
4	Channel saturation	What do we do when marginal CAC blows up?
5	Owned audiences	Which assets cannot be turned off overnight?

Distribution must match motion: PLG leans SEO, viral loops, OSS and content. Inside sales leans inbound plus outbound. Enterprise leans named accounts, partners, events and marketplace co-sell. Measure each channel's CAC, volume and retention quality separately. Blended CAC hides that paid users churn 2× organic.

When someone proposes a new channel, ask for the test design, the CAC math, and what we stop doing if it fails. Shipping a public template gallery or a meaningful integration can be higher-leverage marketing than another homepage rewrite.

Common mistakes

Five half-channels. Distribution is a power law. Focus.
No kill criterion. Zombie budget lines live forever.
Scaling a channel whose users retain worse. Unblend the metrics.
Living only on rented land. Algorithms and stores will tighten.

Key takeaways

Distribution is strategy. One working channel can make the business.
Channel-market fit is arithmetic: conversion × ACV must clear the channel's cost.
Test with Bullseye and kill criteria, then focus. Channels saturate — plan the next ring.
Build owned audiences (content, community, OSS, lists) so you are not rented-land forever.
Keep channel metrics unblended and tied to unit economics.