MANAGING MARKETING CHANNELS OF DISTRIBUTION
APPLE STORES: CREATING A HIGH-TOUCH CUSTOMER EXPERIENCE IN A HIGH-TECH MARKETING CHANNEL
The variety of terms used for marketing intermediaries that vary in use in consumer and business markets
Intermediaries minimize transactions and the cost of distribution for producers and customers
NATURE AND IMPORTANCE OF MARKETING CHANNELS THE VALUE CREATED BY INTERMEDIARIES <ul><li>Marketing Channel </li></ul><ul><l...
Marketing channel intermediaries perform three functions, each consisting of different activities
CHANNEL STRUCTURE & ORGANIZATION MARKETING CHANNELS FOR CONSUMER GOODS AND SERVICES <ul><li>Direct Channel </li></ul><ul><...
Common marketing channels for consumer offerings by the kind and number of intermediaries
One Telecom Company’s Consumer Market Channels CUSTOMER ACQUISITION Business Office Smart Moves Newcomer Agents CUSTOMER D...
CHANNEL STRUCTURE & ORGANIZATION MARKETING CHANNELS FOR BUSINESS GOODS AND SERVICES <ul><li>Direct Channel </li></ul><ul><...
Common marketing channels for business offerings by the kind and number of intermediaries
CHANNEL STRUCTURE & ORGANIZATION ELECTRONIC & DIRECT MARKETING CHANNELS; MULTICHANNEL MARKETING <ul><li>Electronic Marketi...
Consumer electronic marketing channels are similar to those for consumer and business offerings
CHANNEL STRUCTURE & ORGANIZATION DUAL DISTRIBUTION & STRATEGIC CHANNEL ALLIANCES <ul><li>Dual Distribution </li></ul><ul><...
HELP YOUR CHILD FEEL BETTER WITH TRIAMINIC ®  PRODUCTS AND A REDBOX MOVIE RENTAL
1. Customers demand it. 2. Market access. 3. Lower marketing and selling expenses. 4. Distributors perform necessary funct...
Functions performed by independent wholesaler types
CHANNEL STRUCTURE & ORGANIZATION CHANNEL INTERMEDIARIES <ul><li>Merchant Wholesalers </li></ul><ul><li>Full-Service Wholes...
CHANNEL STRUCTURE & ORGANIZATION CHANNEL INTERMEDIARIES <ul><li>Merchant Wholesalers </li></ul><ul><li>Limited-Service Who...
CHANNEL STRUCTURE & ORGANIZATION CHANNEL INTERMEDIARIES <ul><li>Agents and Brokers </li></ul><ul><li>Manufacturer’s Agents...
Three types of vertical marketing systems: corporate, contractual (most popular), and administered
CHANNEL STRUCTURE & ORGANIZATION VERICAL MARKETING SYSTEMS <ul><li>Vertical Marketing Systems </li></ul><ul><li>Forward In...
CHANNEL STRUCTURE & ORGANIZATION VERICAL MARKETING SYSTEMS <ul><li>Contractual Systems </li></ul><ul><li>Franchising </li>...
McDonalds and H&R Block What vertical marketing system does each use?
CHANNEL STRUCTURE & ORGANIZATION VERICAL MARKETING SYSTEMS <ul><li>Administered Systems </li></ul><ul><li>Channel Partners...
CHANNEL CHOICE AND MANAGEMENT FACTORS AFFECTING CHANNEL CHOICE <ul><li>Environmental Factors </li></ul><ul><li>Consumer Fa...
CHANNEL CHOICE AND MANAGEMENT CHANNEL CHOICE CONSIDERATIONS <ul><li>Target Market Coverage </li></ul><ul><li>Intensive Dis...
CHANNEL CHOICE AND MANAGEMENT CHANNEL CHOICE CONSIDERATIONS <ul><li>Satisfying Buyer Requirements </li></ul><ul><li>Inform...
Jiffy Lube and Petco What buyer requirements have been satisfied? 15-
GOING ONLINE Visit an Apple Store to See What All the Excitement is About
Apple Product Examples iPad iPhone MacBook Air iMac
CHANNEL CHOICE AND MANAGEMENT CHANNEL CHOICE CONSIDERATIONS <ul><li>Profitability </li></ul><ul><li>Margins Earned </li></...
USING MARKETING DASHBOARDS Channel Sales and Profit at Charlesburg Furniture
CHANNEL CHOICE AND MANAGEMENT CHANNEL RELATIONSHIPS <ul><li>Sources of  Channel Conflict </li></ul><ul><li>Vertical Confli...
CHANNEL CHOICE AND MANAGEMENT CHANNEL RELATIONSHIPS <ul><li>Channel Captain </li></ul><ul><li>Channel Influence </li></ul>...
CHANNEL CHOICE AND MANAGEMENT CHANNEL RELATIONSHIPS <ul><li>Legal Considerations </li></ul><ul><li>Dual Distribution </li>...
The Clayton Act and Sherman Act place legal restrictions on specific marketing channel strategies and practices
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    1. 1. MANAGING MARKETING CHANNELS OF DISTRIBUTION
    2. 2. APPLE STORES: CREATING A HIGH-TOUCH CUSTOMER EXPERIENCE IN A HIGH-TECH MARKETING CHANNEL
    3. 3. The variety of terms used for marketing intermediaries that vary in use in consumer and business markets
    4. 4. Intermediaries minimize transactions and the cost of distribution for producers and customers
    5. 5. NATURE AND IMPORTANCE OF MARKETING CHANNELS THE VALUE CREATED BY INTERMEDIARIES <ul><li>Marketing Channel </li></ul><ul><li>Functions Performed by Intermediaries </li></ul><ul><li>Transactional Function </li></ul><ul><li>Logistical Function </li></ul><ul><li>Facilitating Function </li></ul><ul><li>Utilities Received by Consumers </li></ul>
    6. 6. Marketing channel intermediaries perform three functions, each consisting of different activities
    7. 7. CHANNEL STRUCTURE & ORGANIZATION MARKETING CHANNELS FOR CONSUMER GOODS AND SERVICES <ul><li>Direct Channel </li></ul><ul><li>Indirect Channel </li></ul><ul><li>Retailers </li></ul><ul><li>Wholesalers  Retailers </li></ul><ul><li>Agents  Wholesalers  Retailers </li></ul>
    8. 8. Common marketing channels for consumer offerings by the kind and number of intermediaries
    9. 9. One Telecom Company’s Consumer Market Channels CUSTOMER ACQUISITION Business Office Smart Moves Newcomer Agents CUSTOMER DEVELOPMENT Best Customer Centers RSC Service Upselling Direct Mail Outbound Telemarketing Welcome Package Directory MASS MEDIA Advertising Response TV Radio Print Specialty MAILBOX MARKETING Direct Mail Catalog Internet FACE TO FACE Retail Stores Express Kiosks National Retailers Local Agents Direct Sales LIFESTYLE INTERCEPT Military Campus Retirement Kids Away Event Marketing On the Move AFFINITY Employee/ Employer Associations Co-Marketing Partners
    10. 10. CHANNEL STRUCTURE & ORGANIZATION MARKETING CHANNELS FOR BUSINESS GOODS AND SERVICES <ul><li>Direct Channel </li></ul><ul><li>Indirect Channel </li></ul><ul><li>Industrial Distributor </li></ul><ul><li>Agents </li></ul><ul><li>Agents  Industrial Distributors </li></ul>
    11. 11. Common marketing channels for business offerings by the kind and number of intermediaries
    12. 12. CHANNEL STRUCTURE & ORGANIZATION ELECTRONIC & DIRECT MARKETING CHANNELS; MULTICHANNEL MARKETING <ul><li>Electronic Marketing Channels </li></ul><ul><li>Direct Marketing Channels </li></ul><ul><li>Multichannel Marketing </li></ul>
    13. 13. Consumer electronic marketing channels are similar to those for consumer and business offerings
    14. 14. CHANNEL STRUCTURE & ORGANIZATION DUAL DISTRIBUTION & STRATEGIC CHANNEL ALLIANCES <ul><li>Dual Distribution </li></ul><ul><li>Strategic Channel Alliances </li></ul>
    15. 15. HELP YOUR CHILD FEEL BETTER WITH TRIAMINIC ® PRODUCTS AND A REDBOX MOVIE RENTAL
    16. 16. 1. Customers demand it. 2. Market access. 3. Lower marketing and selling expenses. 4. Distributors perform necessary functions. 5. Reduced collection problems. The Top Five Reasons for Selling Through Distributors
    17. 17. Functions performed by independent wholesaler types
    18. 18. CHANNEL STRUCTURE & ORGANIZATION CHANNEL INTERMEDIARIES <ul><li>Merchant Wholesalers </li></ul><ul><li>Full-Service Wholesalers </li></ul><ul><li>General Merchandise (Full-Line) Wholesalers </li></ul><ul><li>Specialty Merchandise (Limited-Line) Wholesalers </li></ul>
    19. 19. CHANNEL STRUCTURE & ORGANIZATION CHANNEL INTERMEDIARIES <ul><li>Merchant Wholesalers </li></ul><ul><li>Limited-Service Wholesalers </li></ul><ul><li>Rack Jobbers </li></ul><ul><li>Cash and Carry Wholesalers </li></ul><ul><li>Drop Shippers/Desk Jobbers </li></ul><ul><li>Truck Jobbers </li></ul>
    20. 20. CHANNEL STRUCTURE & ORGANIZATION CHANNEL INTERMEDIARIES <ul><li>Agents and Brokers </li></ul><ul><li>Manufacturer’s Agents </li></ul><ul><li>Selling Agents </li></ul><ul><li>Brokers </li></ul><ul><li>Manufacturers </li></ul><ul><li>Branch Offices </li></ul><ul><li>Sales Offices </li></ul>
    21. 21. Three types of vertical marketing systems: corporate, contractual (most popular), and administered
    22. 22. CHANNEL STRUCTURE & ORGANIZATION VERICAL MARKETING SYSTEMS <ul><li>Vertical Marketing Systems </li></ul><ul><li>Forward Integration </li></ul><ul><li>Corporate Systems </li></ul><ul><li>Backward Integration </li></ul><ul><li>Wholesaler-Sponsored Voluntary Chains </li></ul><ul><li>Contractual Systems </li></ul><ul><li>Retailer-Sponsored Cooperatives </li></ul>
    23. 23. CHANNEL STRUCTURE & ORGANIZATION VERICAL MARKETING SYSTEMS <ul><li>Contractual Systems </li></ul><ul><li>Franchising </li></ul><ul><li>Manufacturer-Sponsored Retail Franchise Systems </li></ul><ul><li>Manufacturer-Sponsored Wholesale Systems </li></ul><ul><li>Service-Sponsored Retail Franchise Systems </li></ul><ul><li>Service-Sponsored Franchise Systems </li></ul>
    24. 24. McDonalds and H&R Block What vertical marketing system does each use?
    25. 25. CHANNEL STRUCTURE & ORGANIZATION VERICAL MARKETING SYSTEMS <ul><li>Administered Systems </li></ul><ul><li>Channel Partnership </li></ul>
    26. 26. CHANNEL CHOICE AND MANAGEMENT FACTORS AFFECTING CHANNEL CHOICE <ul><li>Environmental Factors </li></ul><ul><li>Consumer Factors </li></ul><ul><li>Product Factors </li></ul><ul><li>Company Factors </li></ul>
    27. 27. CHANNEL CHOICE AND MANAGEMENT CHANNEL CHOICE CONSIDERATIONS <ul><li>Target Market Coverage </li></ul><ul><li>Intensive Distribution </li></ul><ul><li>Exclusive Distribution </li></ul><ul><li>Selective Distribution </li></ul>
    28. 28. CHANNEL CHOICE AND MANAGEMENT CHANNEL CHOICE CONSIDERATIONS <ul><li>Satisfying Buyer Requirements </li></ul><ul><li>Information </li></ul><ul><li>Convenience </li></ul><ul><li>Variety </li></ul><ul><li>Pre- or Post-Sale Service </li></ul>
    29. 29. Jiffy Lube and Petco What buyer requirements have been satisfied? 15-
    30. 30. GOING ONLINE Visit an Apple Store to See What All the Excitement is About
    31. 31. Apple Product Examples iPad iPhone MacBook Air iMac
    32. 32. CHANNEL CHOICE AND MANAGEMENT CHANNEL CHOICE CONSIDERATIONS <ul><li>Profitability </li></ul><ul><li>Margins Earned </li></ul><ul><li>Channel Costs </li></ul><ul><li>Global Dimensions of Marketing Channels </li></ul>
    33. 33. USING MARKETING DASHBOARDS Channel Sales and Profit at Charlesburg Furniture
    34. 34. CHANNEL CHOICE AND MANAGEMENT CHANNEL RELATIONSHIPS <ul><li>Sources of Channel Conflict </li></ul><ul><li>Vertical Conflict </li></ul><ul><li>Disintermediation </li></ul><ul><li>Horizontal Conflict </li></ul>
    35. 35. CHANNEL CHOICE AND MANAGEMENT CHANNEL RELATIONSHIPS <ul><li>Channel Captain </li></ul><ul><li>Channel Influence </li></ul><ul><li>Economic </li></ul><ul><li>Expertise </li></ul><ul><li>Identification </li></ul><ul><li>Legitimate Right </li></ul>
    36. 36. CHANNEL CHOICE AND MANAGEMENT CHANNEL RELATIONSHIPS <ul><li>Legal Considerations </li></ul><ul><li>Dual Distribution </li></ul><ul><li>Vertical Integration </li></ul><ul><li>Exclusive Dealing </li></ul><ul><li>Tying Arrangements </li></ul><ul><li>Refusal to Deal </li></ul><ul><li>Resale Restrictions </li></ul>
    37. 37. The Clayton Act and Sherman Act place legal restrictions on specific marketing channel strategies and practices

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