Marketing Channels and SupplyMarketing Channels and Supply
Chain ManagementChain Management
10
10-2
Marketing or Distribution
Channel
• A set of interdependent organizationsA set of interdependent organizations
involv...
10-3
ContactContact FinancingFinancing
InformationInformation
Risk TakingRisk Taking
PromotionPromotion
MatchingMatching
N...
10-4
Consumer and Business Channels
10-5
Channel Behavior
• The channel will be most effective when:The channel will be most effective when:
– each member is ...
10-6
Channel Conflict
When it decided to sell its familiar containers at retail through Target stores,
Tupperware avoided ...
10-7
Conventional vs. Vertical Marketing System
10-8
Corporate VMS
Common Ownership at Different
Levels of the Channel (e.g., Sears)
Contractual VMS
Contractual Agreement...
10-9
Innovations in Marketing Systems
Two or moreTwo or more
companies at onecompanies at one
channel level joinchannel le...
10-10
Number of Intermediaries
• Intensive distributionIntensive distribution
• Exclusive distributionExclusive distributi...
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  • Page <number>
    Chapter 1
    1). Information: Gathering and distributing marketing research and intelligence information about actors and forces in the marketing environment needed for planning and aiding exchange.
    2). Promotion:
    3). Contact: with prospective buyers.
    4). Matching—buyers with sellers.
    5). Negotiation so ownership can take place.
    6). Others include:
    a). Physical distribution (such as transportation and storage).
    b). Financing.
    c). Risk taking.
    Note: The question is not whether these functions must be performed but rather who will perform them.
  • Page <number>
    Chapter 1
  • Page <number>
    Chapter 1
  • 180604 633763372573236250

    1. 1. Marketing Channels and SupplyMarketing Channels and Supply Chain ManagementChain Management 10
    2. 2. 10-2 Marketing or Distribution Channel • A set of interdependent organizationsA set of interdependent organizations involved in the process of making ainvolved in the process of making a product or service available for use orproduct or service available for use or consumption by the consumer or businessconsumption by the consumer or business user.user.
    3. 3. 10-3 ContactContact FinancingFinancing InformationInformation Risk TakingRisk Taking PromotionPromotion MatchingMatching NegotiationNegotiation Physical Distribution Physical Distribution These functions should be assigned to the channel member who can add the most value for the cost Channel Functions
    4. 4. 10-4 Consumer and Business Channels
    5. 5. 10-5 Channel Behavior • The channel will be most effective when:The channel will be most effective when: – each member is assigned tasks it can do best.each member is assigned tasks it can do best. – all members cooperate to attain overall channelall members cooperate to attain overall channel goals.goals. • If this does not happen, conflict occurs:If this does not happen, conflict occurs: – Horizontal ConflictHorizontal Conflict occurs among firms at the sameoccurs among firms at the same level of the channel (e.g., retailer to retailer).level of the channel (e.g., retailer to retailer). – Vertical ConflictVertical Conflict occurs between different levels ofoccurs between different levels of the same channel (e.g., wholesaler to retailer).the same channel (e.g., wholesaler to retailer). • Some conflict can be healthy competition.Some conflict can be healthy competition.
    6. 6. 10-6 Channel Conflict When it decided to sell its familiar containers at retail through Target stores, Tupperware avoided conflicts with its army of in-home sales consultants by inviting them into the stores to demonstrate the products.
    7. 7. 10-7 Conventional vs. Vertical Marketing System
    8. 8. 10-8 Corporate VMS Common Ownership at Different Levels of the Channel (e.g., Sears) Contractual VMS Contractual Agreements Among Channel Members (e.g., ACE Hardware) Administered VMS Leadership is Assumed by One or a Few Dominant Members (e.g., Kraft) Types of Vertical Marketing Systems Control High Low
    9. 9. 10-9 Innovations in Marketing Systems Two or moreTwo or more companies at onecompanies at one channel level joinchannel level join together to follow atogether to follow a new marketingnew marketing opportunity.opportunity. Example: Banks inExample: Banks in grocery storesgrocery stores Two or moreTwo or more companies at onecompanies at one channel level joinchannel level join together to follow atogether to follow a new marketingnew marketing opportunity.opportunity. Example: Banks inExample: Banks in grocery storesgrocery stores A single firm sets upA single firm sets up two or more marketingtwo or more marketing channels to reach onechannels to reach one or more customeror more customer segments.segments. Example: RetailersExample: Retailers and catalogsand catalogs A single firm sets upA single firm sets up two or more marketingtwo or more marketing channels to reach onechannels to reach one or more customeror more customer segments.segments. Example: RetailersExample: Retailers and catalogsand catalogs Horizontal Marketing System Horizontal Marketing System Hybrid MarketingHybrid Marketing SystemSystem Hybrid MarketingHybrid Marketing SystemSystem
    10. 10. 10-10 Number of Intermediaries • Intensive distributionIntensive distribution • Exclusive distributionExclusive distribution • Selective distributionSelective distribution

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