This document discusses distribution channels and channel conflict in marketing. It describes different types of channel conflict including vertical, horizontal, and multichannel conflict. It also outlines strategies for managing channel conflict and discusses channel design decisions including analyzing customer needs, setting objectives, identifying alternatives, and evaluation. Finally, it covers distribution systems in travel and tourism, the role of travel intermediaries, and the impact of technology on travel distribution.

1. Distribution Channels:
Travel Agents & Tour Operators

2. Distribution System

3. Channels & Marketing Decisions

4. Distribution Channel Functions

5. Distribution Channel Functions
Cont. . .

6. What is Channel Conflict?

7.  Vertical Conflict involve a disagreement between two
channel members on consecutive levels.
 For Example, if the toy manufacturer discovers its products are
arriving at retail stores later than scheduled, a conflict might
develop between the manufacturer and the wholesaler
responsible for shipping to retailers.
 Horizontal Conflict refers to a disagreement among two or
more channel members at the same level.
 For Example, suppose a toy manufacturer has deals with two
wholesalers, each contracted to sell products to retailers in
different regions.
 Multichannel Conflict occurs when a manufacturer has
established two or more channels that compete against each
other in selling to the same market.
 For example, a major tire manufacturer may begin selling its
tires through mass merchandisers, much to the dismay of its
independent tire.

8. Causes of Channel Conflict

9. Strategies for Managing
Channel Conflict

10. Channel Level
A layer of intermediaries that performs some work in
bringing the product and its ownership closer to the
final buyer.
Direct & Indirect Marketing Channels
Direct Marketing Channel:
A marketing channel that has no intermediary levels.
Indirect Marketing Channel:
Channel containing one or more intermediary levels.

11. 1. Conventional Distribution Systems
It consist of one or more independent producers,
wholesalers and retailers. Each seeks to maximize its
own profits, and there is little control over the other
members and no formal means for assigning roles and
resolving conflicts.
Types of Marketing Systems

12. 2. Vertical Marketing System
It provide channel leadership and consist of producers,
wholesalers and retailers acting as a unified system and
consist of:
 Corporate Marketing Systems
 Contractual Marketing Systems
 Administered Marketing Systems
3. Horizontal Marketing Systems
When two or more companies at one level join together to
follow a new marketing opportunity.
Companies combine financial, production or marketing
resources to accomplish more than any one company could
alone.

13. 4. Hybrid Marketing Channels
When a single firm sets up two or more marketing
channels to reach one or more customer segments.

14. Channel Design Decisions
There are 4 steps in designing channel decisions:
1. Analyzing consumer needs
2. Setting channel objectives
3. Identifying major channel alternatives
4. Evaluation

15. Setting Channel Objectives
 Targeted levels of customer service
 What segments to serve
 Best channels to use
 Minimizing the cost of meeting customer service requirements.

16. Identifying Major Alternatives
 Intensive Distribution
 Exclusive Distribution
 Selective Distribution

21. Distribution Systems

22. Distribution Systems Cont. . .

23. Some of the other advantages are
 It is expensive for airlines to have their presence in every
high street and shopping malls around the world.
 Some passengers liked a personalised source of tickets, and
sometime they could turn to for advice and help.
 It reduce overhead burden on the airlines.
 Agents undoubtedly relieved airlines of a great deal of the
costly administrative work associated with air travel.

24. Travel Intermediaries

25. Travel Intermediaries cont. . .

26. Travel Intermediaries cont. . .

27. The Impact of Technology on
Travel Distribution Systems

28. The Impact of Technology on
Travel Distribution Systems