The distribution industry is changing fast, thanks to modern technologies, platforms, and changing customer expectations. As a game developer or publisher, you need to adapt to these changes and find the best way to reach your target audience and grow your revenue.

One of the key aspects of your distribution strategy is choosing between two different models: the traditional digital wholesaler model and the distribution network model. The main difference between these two models is how they handle digital products: the digital wholesaler model follows the physically originated buy-sale model, meaning that they buy and sell digital products in fixed quantities and prices, while the distribution network model handles digital products as transactions, meaning that they facilitate the exchange of license keys and entitlements among stakeholders on demand. 

Lets get these two distribution models compaired here. We will also explain why VaultN’s smart distribution platform, which offers access to a self-service distribution network, is the better choice for future-proofing your distribution strategy and ensuring maximum return on your direct partnerships. 

What is a Digital Wholesaler?

A digital wholesaler is an intermediary that buys digital products from publishers and sells them to retailers or end-users. A digital wholesaler offers a managed service, meaning that they handle all aspects of the distribution process, such as pricing, marketing, delivery, and channel support. A digital wholesaler may also provide some value-added services, such as analytics, reporting, or localization. 

A digital wholesaler follows the physically originated buy-sale model, meaning that they buy digital products from publishers and sell them to retailers or end-users. This implies that digital products are often still treated as if they were produced in boxes, shipped to warehouses, and have a fixed supply regardless of demand. However, in a digital world, this model can cause delays, errors, or inefficiencies. For example, a digital wholesaler may not be able to adjust the prices or quantities of the products quickly enough to match the market conditions or customer preferences. A digital wholesaler may also face competition from other wholesalers or platforms that offer similar or better products or services.

Another drawback of using a digital wholesaler is that it requires you to deliver massive quantities of license keys or product codes on consignment in advance, which can pose security and financial risks. You may also lose control over your products once they are delivered to the wholesaler, who may resell them to other parties without your consent or knowledge.

What is a Distribution Network?

A distribution network is an innovative platform that enables direct, secure, and on-demand transactions of license keys and entitlements among stakeholders in the gaming industry. Distribution platforms use innovative technologies to streamline distribution workflows, minimize manual intervention and errors, and safeguard license keys and products. 

VaultN’s smart distribution platform offers access to a self-service network that allows developers, publishers, and distributors to connect directly with retailers without any intermediaries. Publishers can manage all aspects of their distribution strategy with VaultN’s web-based solution such as inventory management, pricing optimization, delivery automation and client communication. Publishers can also access real-time data and analytics that can help them monitor their performance and optimize their sales channel. As a plus, the high level of automation enables all stakeholders to manage more partners.

VaultN’s network handles digital products as transactions

VaultN handles digital products as transactions, meaning that it facilitates the exchange of license keys and entitlements among stakeholders on demand. This implies that digital products are treated as if they were dynamic and flexible, and that they can be customized and delivered on demand. In a digital world, this model can ensure accuracy, efficiency, and security. For example, VaultN’s network allows publishers to set their own rules and conditions for transactions, such as pricing, availability, or region restrictions. Unlike a traditional wholesaler, publishers can provide activations on-demand when a transaction to a consumer meets their requirements. This way publishers can also distribute to wholesalers if they wish, but without any risk or loss of control over their products. 

Most developers and publishers in PC Digital use Steam Keys. And if you attend any games industry conference in the past months you might have heard publishers talking about Steam’s reluctance to generate key batches that can be used for third-party sales. Using a distribution network and on-demand delivery reduces the need for massive quantities of license keys or product codes, which can save you time and money. You only need to provide activations on-demand when a transaction meets your requirements, which can also prevent fraud, piracy, or unauthorized access. 

What are the Benefits of Using VaultN’s Smart Distribution Platform? 

Using VaultN’s smart distribution platform can have many advantages such as: 

• Scalability: VaultN’s platform allows you to scale your business faster and more efficiently than a digital wholesaler. You can easily onboard new customers suppliers or partners with a simple invite. You can also adjust your inventory pricing and delivery options according to your needs and preferences. You do not have to rely on a third-party service or platform that may limit your growth potential or charge you management fees. 
• Communication: VaultN’s platform enables you to communicate directly with your channel partners and build stronger relationships than via a digital wholesaler. You can collect retailer and customer feedback, offer exclusive deals and campaigns, personalized recommendations and provide a more streamlined service. 
• Security: VaultN’s platform ensures the security and integrity of your products and transactions with its advanced technologies. You no longer need to deliver massive quantities of license keys or product codes on consignment in advance but only provide activations on-demand when a transaction to consumer meets your requirements. This way you can also distribute to wholesalers if you wish but without any risk or loss of control over your products. 

If you are a publisher or developer of video games or other digital goods or services, we recommend that you consider using our platform to distribute your products. VaultN can help you scale your business faster and more efficiently communicate directly with your channel partners, build stronger relationships with them, and ensure the security and integrity of your products and transactions. Want to learn more about our platform? Get in touch with the VaultN team and we will reach out to you shortly.