Marketing Channels

2. Marketing Channel:
A marketing channel is a set of
practices or activities necessary to transfer
the ownership of goods, and to move goods,
from the point of production to the point
of consumption and, as such, which
consists of all the institutions and all
the marketing activities in the marketing
process.

3. Role of marketing channel in marketing
strategies:
Links producers to buyers.
Performs sales, advertising and promotion.
Influences the firm's pricing strategy.
Affecting product strategy through branding,
policies, willingness to stock.
Customizes profits, install, maintain, offer credit,
etc.

4. Types of Marketing Channels:

5. Manufacturer to Customer:
Manufacturer makes the
goods and sells them to the consumer directly
with no intermediary.
Example:
A farmer may sell some produce directly to
customers. A bakery may sell cakes and pies
directly to customers.

6. Manufacturer to Retailer to Consumer:
Purchases are made by
the retailer from the manufacturer and then
the retailer sells the merchandise to the
consumer. This channel is used by
manufacturers that specialize in producing
shopping goods.

7. Manufacturer to Wholesaler to
Customer:
Consumer’s can buy
directly from the wholesaler. The
wholesaler breaks down bulk packages for
resale to the consumer. The wholesaler
reduces some of the cost to the consumer
such as service cost or sales force cost,
which makes the purchase price cheaper for
the consumer.

8. Manufacturer to Agent to
Wholesaler to Retailer to Customer:
Distribution that
involves more than one intermediary
involves an agent called in to be the
middleman and assist with the sale of the
goods. An agent receives a commission
from the producer. Agents are useful when
goods need to move quickly into the market
soon after the order is placed.