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2. Marketing Management
Arab World Edition
Kotler, Keller, Hassan, Baalbaki and Shamma
Chapter 15
Designing and
Managing Integrated
Marketing channels

3. Copyright © 2012 Pearson Education 15-2
Chapter Questions
1. What is a marketing channel system and value network?
2. What work do marketing channels perform?
3. How should channels be designed?
4. What decisions do companies face in managing their
channels?
5. How should companies integrate channels and manage
channel conflict?
6. What are the key issues with e-commerce?

4. Marketing Channels and Value
Networks
Chapter Question 1:
What is a marketing
channel system and value
network?
Copyright © 2012 Pearson Education 15-3
• A marketing channel is the set of interdependent
organizations involved in the process of making a product or
service available for use or consumption.
• A marketing channel system is the particular set of
marketing channels employed by a firm.

5. The Importance of Channels
Chapter Question 1:
What is a marketing
channel system and value
network?
Copyright © 2012 Pearson Education 15-4
Companies must decide how much effort to devote to push
versus pull marketing:
• A push strategy uses the manufacturer’s sales force, trade
promotion money, and other means to induce intermediaries
to carry, promote, and sell the product to end users.
• A pull strategy uses advertising, promotion, and other forms
of communication to persuade consumers to demand the
product from intermediaries.

6. Copyright © 2009 Pearson Education, Inc. Publishing as
Prentice Hall 15-5
Buyer Expectations for
Channel Integration
• Ability to order a
product online and pick
it up at a convenient
retail location
• Ability to return an
online-ordered product
to a nearby store
• Right to receive
discounts based on total
online and offline
purchases

7. Chapter Question 2:
What work do marketing
channels perform?
Copyright © 2012 Pearson Education 15-6
• Services and ideas companies also face the problem of
making their output available and accessible to target
populations.
• As internet and other technologies advance, service
industries such as banking, insurance, travel, and stock
buying and selling are operating through new channels.
Service Sector Channels

8. Channel-Design Decisions
Chapter Question 3:
How should channels be
designed?
Copyright © 2012 Pearson Education 15-7
Designing a marketing channel system requires:
• Analyzing customer needs
• Establishing channel objectives
• Identifying major channel alternatives
• Evaluating major channel alternatives

9. Chapter Question 3:
How should channels be
designed?
Copyright © 2012 Pearson Education 15-8
Identifying and Evaluating Major
Channel Alternatives
Number of Intermediaries
Three strategies are available:
• Exclusive distribution: Just One Intermediary At same level
• Selective distribution: Relatively Few Intermediaries
• Intensive distribution: All Possible Intermediaries
McDonald’s Bahrain operates one of the
few 24/7 McDelivery services in the world.

10. Channel-Management Decisions
Chapter Question 4:
What decisions do
companies face in
managing their channels?
Copyright © 2012 Pearson Education 15-9
After a company has chosen a channel system, it must:
• Select, train, motivate, and evaluate individual
intermediaries for each channel.
• Modify channel design and arrangements over time.

11. Copyright © 2009 Pearson Education, Inc. Publishing as
Prentice Hall 15-10
Channel-Management Decisions
Selecting channel members
Training channel members
Motivating channel members
Evaluating channel members
Modifying channel members

12. E-Commerce Marketing Practices
Chapter Question 6:
What are the key issues
with e-commerce?
Copyright © 2012 Pearson Education 15-11
The text explores particular issues for the following:
• Pure-click companies – companies that have launched a website
without any previous existence as a firm.
• Brick-and-click companies – existing companies that have
added an online site for information and/or e-commerce.
• M-commerce – use of mobile phones or PDAs to access the
internet.

13. Marketing Strategy Over the Product
Life Cycle
INTRODUCTION GROWTH MATURITY DECLINE
Marketing strategy Market development Increase market Defend market Maintain efficiency in
emphasis share share exploiting product
Promotion Mount sales Appeal to Emphasize Reinforce loyal
Strategy promotion for mass market brand differences, customers; reduce
product awareness benefits & loyalty promotion costs
Place strategy Distribute through Build intensive Enlarge Be selective in
selective outlets network of distribution distribution, trim
outlets network unprofitable outlets
Pricing High price/unique Lower price Price at or below Set price to
strategy product / cover over time competition remain profitable
production costs or reduce to
Low price/gain liquidate
market share