Chap015

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Chap015

  1. 1. McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved. 15-1
  2. 2. LEARNING OBJECTIVES (LO) AFTER READING CHAPTER 15, YOU SHOULD BE ABLE TO: LO1 LO2 Explain what is meant by a marketing channel of distribution and why intermediaries are needed. Distinguish among traditional marketing channels, electronic marketing channels, and different types of vertical marketing systems. 15-2
  3. 3. LEARNING OBJECTIVES (LO) AFTER READING CHAPTER 15, YOU SHOULD BE ABLE TO: LO3 Describe factors that marketing executives consider when selecting and managing a marketing channel. LO4 Explain what supply chain and logistics management are and how they relate to marketing strategy. 15-3
  4. 4. CALLAWAY GOLF: DESIGNING AND DELIVERING THE GOODS FOR GREAT GOLF 15-4
  5. 5. FIGURE 15-1 The variety of terms used for marketing intermediaries that vary in specificity and use in consumer and business markets 15-5
  6. 6. LO1 NATURE AND IMPORTANCE OF MARKETING CHANNELS THE VALUE CREATED BY INTERMEDIARIES  Marketing Channel  Functions Performed by Intermediaries • Transactional Function • Logistical Function • Facilitating Function  Utilities Received by Consumers 15-6
  7. 7. FIGURE 15-2 Marketing channel intermediaries perform three functions, each consisting of different activities 15-7
  8. 8. CHANNEL STRUCTURE & ORGANIZATION LO2 MARKETING CHANNELS FOR CONSUMER PRODUCTS AND SERVICES  Direct Channel  Indirect Channel • Retailers • WholesalersRetailers • AgentsWholesalersRetailers 15-8
  9. 9. FIGURE 15-3 Common marketing channels for consumer products and services by the kind and number of intermediaries 15-9
  10. 10. CHANNEL STRUCTURE & ORGANIZATION LO2 MARKETING CHANNELS FOR BUSINESS PRODUCTS AND SERVICES  Direct Channel  Indirect Channel • Industrial Distributor • Agents • AgentsIndustrial Distributors 15-10
  11. 11. FIGURE 15-4 Common marketing channels for business products and services by the kind and number of intermediaries 15-11
  12. 12. CHANNEL STRUCTURE & ORGANIZATION LO2 ELECTRONIC & DIRECT MARKETING CHANNELS; MULTICHANNEL MARKETING  Electronic Marketing Channels  Direct Marketing Channels  Multichannel Marketing 15-12
  13. 13. FIGURE 15-5 Consumer electronic marketing channels are similar to those for consumer products and services 15-13
  14. 14. CHANNEL STRUCTURE & ORGANIZATION LO2   DUAL DISTRIBUTION & STRATEGIC CHANNEL ALLIANCES Dual Distribution Strategic Channel Alliances Honey Nut Cherrios Ad 15-14
  15. 15. MARKETING MATTERS LO2 Nestlé and General Mills— Cereal Partners Worldwide 15-15
  16. 16. FIGURE 15-6 Three types of vertical marketing systems: corporate, contractual (most popular), and administered 15-16
  17. 17. LO2 CHANNEL STRUCTURE & ORGANIZATION VERICAL MARKETING SYSTEMS  Vertical Marketing Systems  Corporate Systems • Forward Integration • Backward Integration  Contractual Systems • Wholesaler-Sponsored Voluntary Chains • Retailer-Sponsored Cooperatives 15-17
  18. 18. LO2  CHANNEL STRUCTURE & ORGANIZATION VERICAL MARKETING SYSTEMS Contractual Systems • Franchising  Manufacturer-Sponsored Retail Franchises  Manufacturer-Sponsored Wholesale Franchises  Service-Sponsored Retail Franchises  Service-Sponsored Franchises  Administered Systems 15-18
  19. 19. LO3  CHANNEL CHOICE AND MANAGEMENT CHANNEL CHOICE CONSIDERATIONS Target Market Coverage (Density) • Intensive Distribution • Exclusive Distribution Gucci • Selective Distribution 15-19
  20. 20. LO3  CHANNEL CHOICE AND MANAGEMENT CHANNEL CHOICE CONSIDERATIONS Buyer Requirements • Information • Variety  • Convenience • Pre- or Post-Sale Service Profitability 15-20
  21. 21. LO3 Jiffy Lube and Petco What buyer requirements have been satisfied? 15-21
  22. 22. GOING ONLINE LO3 Visit an Apple Store to See What All the Excitement is About 15-22
  23. 23. USING MARKETING DASHBOARDS LO3 Channel Sales and Profit at Charlesburg Furniture 15-23
  24. 24. LO3  CHANNEL CHOICE AND MANAGEMENT CHANNEL RELATIONSHIPS Sources of Channel Conflict • Vertical Conflict • Disintermediation • Horizontal Conflict 15-24
  25. 25. LO3 CHANNEL CHOICE AND MANAGEMENT CHANNEL RELATIONSHIPS  Channel Captain  Channel Influence • Economic • Identification • Expertise • Legitimate Right 15-25
  26. 26. LO4  CHANNEL CHOICE AND MANAGEMENT CHANNEL RELATIONSHIPS Legal Considerations • Dual Distribution • Tying Arrangements • Vertical Integration • Full-Line Forcing • Exclusive Dealing • Refusal to Deal • Resale Restrictions 15-26
  27. 27. FIGURE 15-7 The Clayton Act and Sherman Act place legal restrictions on specific marketing channel strategies and practices 15-27
  28. 28. LO4 LOGISTICS & SUPPLY CHAIN MANAGEMENT KEY CONCEPTS  Logistics  Supply Chain  Logistics Management  Supply Chain Management • Customer Requirements • The Automotive Supply Chain • Cost-Effective Flow • Customer Service 15-28
  29. 29. FIGURE 15-8 Relating logistics management and supply chain management to supplier networks and marketing channels 15-29
  30. 30. FIGURE 15-9 The automotive supply chain includes thousands of firms that provide the 5,000 or so parts in a typical car 15-30
  31. 31. LO4  LOGISTICS & SUPPLY CHAIN MANAGEMENT SUPPLY CHAIN MGMT & MKT STRATEGY Aligning a Supply Chain with Marketing Strategy • Understand the Customer • Understand the Supply Chain • Harmonize the Supply Chain with the Marketing Strategy 15-31
  32. 32. MARKETING MATTERS LO4 IBM’s Integrated Supply Chain— Delivering a Total Solution for Its Customers 15-32
  33. 33. LO4 LOGISTICS & SUPPLY CHAIN MANAGEMENT SUPPLY CHAIN MGMT & MKT STRATEGY  Dell: A Responsive Supply Chain  Wal-Mart: An Efficient Supply Chain • Cross-docking 15-33
  34. 34. LO4 TWO CONCEPTS OF LOGISTICS MANAGEMENT IN A SUPPLY CHAIN  Total Logistics Cost Concept  Customer Service Concept 15-34
  35. 35. FIGURE 15-10 Supply chain managers balance five total logistics cost factors against four customer service factors 15-35
  36. 36. LO4  TWO CONCEPTS OF LOGISTICS MANAGEMENT IN A SUPPLY CHAIN Time • Lead Time  Order Cycle Time  Replenishment Time • Quick Response • Efficient Consumer Response 15-36
  37. 37. LO4 TWO CONCEPTS OF LOGISTICS MANAGEMENT IN A SUPPLY CHAIN  Dependability  Communication  Convenience • Vendor-Managed Inventory (VMI) 15-37
  38. 38. LO4  CLOSING THE LOOP: REVERSE LOGISTICS Reverse Logistics UPS Video 15-38
  39. 39. MAKING RESPONSIBLE DECISIONS Reverse Logistics and Green Marketing Go Together at Hewlett-Packard: Recycling e-Waste LO4 15-39
  40. 40. VIDEO CASE 15 AMAZON: DELIVERING THE GOODS… MILLIONS OF TIMES A DAY 15-40
  41. 41. VIDEO CASE 15 AMAZON 1. How do Amazon.com’s logistics and supply chain management activities help the company create value for its customers? 15-41
  42. 42. VIDEO CASE 15 AMAZON 2. What systems did Amazon develop to improve the flow of products from suppliers to Amazon distribution centers? What systems improved the flow of orders from the distribution centers to customers? 15-42
  43. 43. VIDEO CASE 15 AMAZON 3. Why will logistics and supply chain management play an important role in the future success of Amazon.com? 15-43
  44. 44. Marketing Channel A marketing channel consists of Individuals and firms involved in the process of making a product or service available for use or consumption by consumers or industrial users. 15-44
  45. 45. Multichannel Marketing Multichannel marketing involves the blending of different communication and delivery channels that are mutually reinforcing in attracting, retaining, and building relationships with consumers who shop and buy in traditional intermediaries and online. 15-45
  46. 46. Dual Distribution Dual distribution involves an arrangement whereby a firm reaches different buyers by employing two or more different types of channels for the same basic product. 15-46
  47. 47. Vertical Marketing Systems Vertical marketing systems are professionally managed and centrally coordinated marketing channels designed to achieve channel economies and maximum marketing impact. 15-47
  48. 48. Intensive Distribution Intensive distribution is a level of distribution density whereby a firm tries to place its products and services in as many outlets as possible. 15-48
  49. 49. Exclusive Distribution Exclusive distribution is a level of distribution density whereby only one retailer in a specific geographical area carries the firm’s products. 15-49
  50. 50. Selective Distribution Selective distribution is a level of distribution density whereby a firm selects a few retailers in a specific geographical area to carry its products. 15-50
  51. 51. Channel Conflict Channel conflict arises when one channel member believes another channel member is engaged in behavior that prevents it from achieving its goals. 15-51
  52. 52. Disintermediation Disintermediation involves channel conflict that arises when a channel member bypasses another member and sells or buys products direct. 15-52
  53. 53. Logistics Logistics consists of those activities that focus on getting the right amount of the right products to the right place at the right time at the lowest possible cost. 15-53
  54. 54. Supply Chain A supply chain consists of a sequence of firms that perform activities required to create and deliver a product or service to ultimate consumers or industrial users. 15-54
  55. 55. Total Logistics Cost Total logistics cost consists of the expenses associated with transportation, materials handling and warehousing, inventory, stockouts (being out of inventory), order processing, and return goods handling. 15-55
  56. 56. Customer Service Customer service is the ability of logistics management to satisfy users in terms of time, dependability, communication, and convenience. 15-56
  57. 57. Vendor-Managed Inventory (VMI) Vendor-managed inventory (VMI) is an inventory-management system whereby the supplier determines the product amount and assortment a customer (such as a retailer) needs and automatically delivers the appropriate items. 15-57
  58. 58. Reverse Logistics Reverse logistics is a process of reclaiming recyclable and reusable materials, returns, and reworks from the point of consumption or use for repair, remanufacturing, redistribution, or disposal. 15-58

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