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1. Research Topic: Super Computer Data Mining
The aim of this project is to produce a super-computing data
mining resource for use by the UK academic community which
utilizes a number of advanced machine learning and statistical
algorithms for large datasets. In particular, a number of
evolutionary computing-based algorithms and the ensemble
machine approach will be used to exploit the large-scale
parallelism possible in super-computing. This purpose is
embodied in the following objectives:
1. to develop a massively parallel approach for commonly used
statistical and machine learning techniques for exploratory data
analysis
1. to develop a massively parallel approach to the use of
evolutionary computing techniques for feature creation and
selection
1. to develop a massively parallel approach to the use of
evolutionary computing techniques for data modelling
1. to develop a massively parallel approach to the use of
ensemble machines for data modelling consisting of many well-
known machine learning algorithms;
1. to develop an appropriate super-computing infra-structure to
support the use of such advanced machine learning techniques
with large datasets.
Research Needs:
Problem definition – In the first phase problem definition is
listed i.e. business aims and objectives are determined taking
into consideration certain factors like the current background
and future prospective.
Data exploration – Required data is collected and explored
using various statistical methods along with identification of
underlying problems.
Data preparation – The data is prepared for modeling by
cleansing and formatting the raw data in the desired way. The
meaning of data is not changed while preparing.
Modeling – In this phase the data model is created by applying
certain mathematical functions and modeling techniques. After
the model is created it goes through validation and verification.
Evaluation – After the model is created, it is evaluated by a
team of experts to check whether it satisfies business objectives
or not.
Deployment – After evaluation, the model is deployed and
further plans are made for its maintenance. A properly
organized report is prepared with the summary of the work
done.
Research paper Policy
· APA format
. https://apastyle.apa.org/
.
https://owl.purdue.edu/owl/research_and_citation/apa_style/apa
_formatting_and_style_guide/general_format.html
· Min number of pages are 15 pages
· Must have
. Contents with page numbers
. Abstract
. Introduction
. The problem
4. Are there any sub-problems?
4. Is there any issue need to be present concerning the problem?
. The solutions
5. Steps of the solutions
. Compare the solution to other solution
. Any suggestion to improve the solution
. Conclusion
. References
· Missing one of the above will result -5/30 of the research
paper
· Paper does not stick to the APA will result in 0 in the research
paper
· Submission
. you have multiple submission to check you safe assignments
. The percentage accepted is 1%
. Any more percentages will result to drop your grade by
multiple by 2
3. For example, if your percentage from safe assignments is
21% then your grads will drop as 21-1= 20 * 2 = - 40
. Not submitting your research paper will result in your grade is
-30
© 2018 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
1
10
Channels of Distribution
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
10. 2
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
2
Marketing Framework
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Discussion Questions #1
Apple introduced the Apple retail store in 2001 when it had less
than 3% of the computer market—prior to its introduction of the
iPod. Previously, Apple computers were sold through local
computer retailers.
What do you think prompted the idea for Apple’s new retail
strategy?
What were the risks associated with this strategy?
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Place
The market realigns discrepancies between buyers and sellers
Sellers have large quantities; Buyers want a few
Breaking bulk
Making goods available in smaller batches
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Distribution Channels
Distribution channel
A network of firms that are interconnected in their quest to
provide sellers a means of infusing the marketplace with their
goods, and buyers a means of purchasing those goods
The goal is to do this efficiently and profitably
Channel members include
Manufacturers, wholesalers, retailers, consumers, etc.
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Functions of a Channel
Activities that are
Customer-oriented (e.g., ordering)
Product-oriented (e.g., storage)
Marketing-centric (e.g., promotion)
Logistics
Coordinating flow of goods, services, and information
throughout channel
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Channel Tension
All channel functions must be done by someone, the question is
…
What is the most effective and efficient way to distribute the
product?
Tension in channels can be created by each channel member
Does member provide more benefit than cost?
The make-or-buy decision
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Channel Questions #1
Which of these is more efficient? Why?
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Channels and Supply Chains
Supply chain
Upstream partners
Channel members
Downstream partners
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Channel Questions #2
Who is in Amazon’s supply chain?
Who is in Pixar’s channel?
How is Dell’s distribution different from the others?
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
The What, Why, & How of Channels
The “what” of channels
Network of suppliers and providers
The “why” of channels
Effectiveness and efficiency
The “how” of channels
Designing effective and efficient channels
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
How to Design Channels
(slide 1 of 4)
Intensive distribution: widely distributed
Drugstores, supermarkets, discount stores, convenience stores,
etc.
Usually for simple, inexpensive, easily transported products
e.g., Snack food, shampoo, newspapers
Pull strategy: promote directly to end consumers to pull through
channel
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
How to Design Channels
(slide 2 of 4)
Selective distribution: limited distribution
Usually for complex and/or expensive products that require
assistance
e.g., Most cars, computers, appliances
Push strategy: promote to distribution partners to push goods to
consumer
Manufacturer has more control due to fewer relationships to
manage
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
How to Design Channels
(slide 3 of 4)
Exclusive distribution: extremely selective
e.g., Ferrari and Rolex
Manufacturers have the most control
May become monopolistic
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
How to Design Channels
(slide 4 of 4)
How much distribution?
Design needs to be consistent with other marketing elements
Wide distribution
Usually goes with heavy promotion, lower prices, and average
or lower-quality products
Exclusive distribution
Usually goes with less promotion, higher prices, and higher-
quality products
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Push vs. Pull Strategies
(slide 1 of 2)
Push strategy
Incentives are offered to distribution partners to push products
through the channel
Pull strategy
Incentives are offered to consumers to pull products through the
channel
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Push vs. Pull Strategies
(slide 2 of 2)
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Power and Conflict in Channels
Conflict arises in distribution channels
Some conflict can be healthy
Some conflict can end a partnership
Power
Power is usually defined by size
Power can be used to win conflict
Exerting power over distribution partners can lead to resentment
and lack of cooperation
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Transaction Cost Analysis (TCA)
Model that considers channel members’ production costs &
governance costs
Goal is to minimize both costs
Production cost
Cost of producing/bringing product to market
Governance cost
Cost involved with relational issues incurred by coordinating
enterprise and controlling one’s partners
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Transaction Value Analysis
Perspective that emphasizes the benefits a company brings to its
partners
Goes beyond cost reductions
Uses human relationship terms
Communication enhances trust
Trust is the willingness and ability to deliver on promises
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Ways to Resolve Conflict
Communicate
Exchange personnel
Sponsor joint research projects
Mediation
Negotiate through a third party that determines the two parties’
utility functions
Arbitration
The third party makes a binding decision for the two parties
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Revenue Sharing
(slide 1 of 2)
Double marginalization: the problem
The manufacturer wants a markup
The retailer wants a second markup
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Revenue Sharing
(slide 2 of 2)
Double marginalization: solutions
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Discussion Question #2
Why wouldn’t the manufacturer just avoid the double
marginalization problem entirely and go directly to the
consumer?
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Integration
(slide 1 of 3)
All functions within a channel need to be completed
Revisit make-or-buy decision
Make: complete a function yourself
Buy: outsource a function
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Integration
(slide 2 of 3)
Vertical integration
Moving backward or forward in a channel
Forward integration
Moving forward in a distribution channel
e.g., Manufacturer opens its own retail stores
Backward integration
Moving backward in a distribution channel
e.g., Manufacturer controls raw materials or retailer sets up
private label
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Integration
(slide 3 of 3)
Private label
Type of backward integration
Advantages
Gives retailer negotiating power with manufacturers
Offers significant margins
Helps differentiate retailer from other retailers
e.g., Great Value oatmeal is only at Walmart
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Global Channels
Channels can be complicated
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Discussion Questions #3
How might Anheuser-Busch engage in forward integration?
How might Google engage in backward integration?
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Retailing & Retail Classifications
Retailers have been gaining power and momentum over the past
10–20 years
Retailers are classified by ownership, level of service, and
product assortment
Management’s level of ownership
Independent retailers
Branded store chains
Franchises
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Retailing Classifications
Level of service provided
Usually related to price points
Product assortment carried
Specialty: carry depth not much breadth
e.g., Toy stores
General merchandise: carry breadth but not much depth
e.g., Department stores
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Retailing Employees
Retail employees are important
Connect the retailer and its customers
Retailers should hire selectively, train well, and pay fairly
Dissatisfied employees can lead to dissatisfied customers and
employee turnover
Employee turnover leads to new associates who cause further
customer dissatisfaction
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Retailing Operations
Retailing is a service
Retailers should flowchart operations
Front-stage: elements customers see
Backstage: elements customers do not see
Must be run efficiently to support front-stage
The goal is to create effective and efficient processes
Self-service is a way to streamline
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Retailing Location
Location is important
Determine appropriate success factors for your specific
business; analyze locations to pick ideal sites
e.g., Population densities, income and social class distributions,
median ages, household composition
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Retailing Growth Strategies
Provide additional services
Target additional segments
Open multiple stores
Expand internationally
e.g., Exporting, joint ventures, direct foreign investment, and
license agreements
Global outsourcing
e.g., India & technology, China & manufacturing
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Franchising
Unique format of multisite expansion
Company can retain some control without complete ownership
or capital expenditure
Benefits
Franchisor: receives capital, scales of economy, committed
people, less risk, can focus on core functions
Franchisee: well-known brand and some market awareness,
supplier relationships, templates for training, central support
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Types of Franchising
Product franchising
Supplier authorizes a distributor in a territory to carry its
products, use its brand name, benefit from its advertising, etc.
e.g., Ford dealers, Coca-Cola bottlers
Business format franchising
Company offers a proven system to conduct business, marketing
support, brand name, advertising, etc., to the franchisee
e.g., McDonald’s, Holiday Inn
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
E-Commerce
The Internet is an important channel
Online retail sales are about $180 billion, growing about 10% a
year
Still only 11% of total retail sales
Customers are younger and more affluent
Customer characteristics are changing to match customers in
general markets
United States dominates but not by much
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Asian Internet Penetration Percentages
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Discussion Question #4
How do you see the future for the distribution of entertainment
programs?
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Catalog Sales
Top 10 catalogers are B2B companies
e.g., Dell, Staples, etc.
80 of the top 100 catalogers continue to see sales growth
Internet is well-suited for a search while catalogs still dominate
browsing
Catalogs often complement not compete with Internet
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Sales Force
(slide 1 of 3)
Utilized extensively with a push strategy
Important with undifferentiated products
Issues
How many?
How to compensate them?
Usually salary plus bonuses
Tie compensation to performance evaluation
Sales force evaluation factors
e.g., Sales, time with clients, expertise
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Sales Force
(slide 2 of 3)
Sales force size
Estimate workload
100,000 stores
12 visits each per year for 30 minutes
50 weeks per year × 40 hours a week = 2,000 hours
500 of these hours will be spent on travel and administrative
duties
(100,000 accounts × 12 visits per year × 0.5 hour)/1,500 hours =
400 salespeople
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Sales Force
(slide 3 of 3)
B2B customers’ biggest complaints about salespeople
The salesperson isn’t following my company’s buying process
They don’t listen to my needs
They didn’t bother to follow up
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Discussion Questions #5
What criteria would you utilize to evaluate a car salesperson?
How would you tie compensation to this evaluation?
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Integrated Marketing Channels
As the number of channels proliferates, increasing care must be
taken to coordinate and integrate across them
Companies must understand customer behavior in order to
design effective distribution channels and to allocate resources
across channel options
Know your customer!
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Managerial Recap
(slide 1 of 2)
Distribution channels are the link from the manufacturer to the
customer
Numerous thoughtful decisions must be made in designing
channels
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.
Managerial Recap
(slide 2 of 2)
Channel entities are independent yet interdependent
organizations; thus, conflicts may arise
Conflicts are best addressed by employing good communication
and trust, revenue sharing, or greater vertical integration
© 2018 Cengage Learning.® May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
‹#›
10.

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  • 1. 1. Research Topic: Super Computer Data Mining The aim of this project is to produce a super-computing data mining resource for use by the UK academic community which utilizes a number of advanced machine learning and statistical algorithms for large datasets. In particular, a number of evolutionary computing-based algorithms and the ensemble machine approach will be used to exploit the large-scale parallelism possible in super-computing. This purpose is embodied in the following objectives: 1. to develop a massively parallel approach for commonly used statistical and machine learning techniques for exploratory data analysis 1. to develop a massively parallel approach to the use of evolutionary computing techniques for feature creation and selection 1. to develop a massively parallel approach to the use of evolutionary computing techniques for data modelling 1. to develop a massively parallel approach to the use of ensemble machines for data modelling consisting of many well- known machine learning algorithms; 1. to develop an appropriate super-computing infra-structure to support the use of such advanced machine learning techniques with large datasets. Research Needs: Problem definition – In the first phase problem definition is listed i.e. business aims and objectives are determined taking into consideration certain factors like the current background and future prospective. Data exploration – Required data is collected and explored using various statistical methods along with identification of underlying problems. Data preparation – The data is prepared for modeling by
  • 2. cleansing and formatting the raw data in the desired way. The meaning of data is not changed while preparing. Modeling – In this phase the data model is created by applying certain mathematical functions and modeling techniques. After the model is created it goes through validation and verification. Evaluation – After the model is created, it is evaluated by a team of experts to check whether it satisfies business objectives or not. Deployment – After evaluation, the model is deployed and further plans are made for its maintenance. A properly organized report is prepared with the summary of the work done. Research paper Policy · APA format . https://apastyle.apa.org/ . https://owl.purdue.edu/owl/research_and_citation/apa_style/apa _formatting_and_style_guide/general_format.html · Min number of pages are 15 pages · Must have . Contents with page numbers . Abstract . Introduction . The problem 4. Are there any sub-problems? 4. Is there any issue need to be present concerning the problem? . The solutions 5. Steps of the solutions . Compare the solution to other solution . Any suggestion to improve the solution . Conclusion . References · Missing one of the above will result -5/30 of the research paper · Paper does not stick to the APA will result in 0 in the research
  • 3. paper · Submission . you have multiple submission to check you safe assignments . The percentage accepted is 1% . Any more percentages will result to drop your grade by multiple by 2 3. For example, if your percentage from safe assignments is 21% then your grads will drop as 21-1= 20 * 2 = - 40 . Not submitting your research paper will result in your grade is -30 © 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. 1 10 Channels of Distribution © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 10. 2 © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole
  • 4. or in part. ‹#› 10. 2 Marketing Framework © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Discussion Questions #1 Apple introduced the Apple retail store in 2001 when it had less than 3% of the computer market—prior to its introduction of the iPod. Previously, Apple computers were sold through local computer retailers. What do you think prompted the idea for Apple’s new retail strategy? What were the risks associated with this strategy? © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Place The market realigns discrepancies between buyers and sellers Sellers have large quantities; Buyers want a few
  • 5. Breaking bulk Making goods available in smaller batches © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Distribution Channels Distribution channel A network of firms that are interconnected in their quest to provide sellers a means of infusing the marketplace with their goods, and buyers a means of purchasing those goods The goal is to do this efficiently and profitably Channel members include Manufacturers, wholesalers, retailers, consumers, etc. © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Functions of a Channel Activities that are Customer-oriented (e.g., ordering) Product-oriented (e.g., storage) Marketing-centric (e.g., promotion) Logistics Coordinating flow of goods, services, and information throughout channel
  • 6. © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Channel Tension All channel functions must be done by someone, the question is … What is the most effective and efficient way to distribute the product? Tension in channels can be created by each channel member Does member provide more benefit than cost? The make-or-buy decision © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Channel Questions #1 Which of these is more efficient? Why? © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Channels and Supply Chains Supply chain
  • 7. Upstream partners Channel members Downstream partners © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Channel Questions #2 Who is in Amazon’s supply chain? Who is in Pixar’s channel? How is Dell’s distribution different from the others? © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. The What, Why, & How of Channels The “what” of channels Network of suppliers and providers The “why” of channels Effectiveness and efficiency The “how” of channels Designing effective and efficient channels © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole
  • 8. or in part. ‹#› 10. How to Design Channels (slide 1 of 4) Intensive distribution: widely distributed Drugstores, supermarkets, discount stores, convenience stores, etc. Usually for simple, inexpensive, easily transported products e.g., Snack food, shampoo, newspapers Pull strategy: promote directly to end consumers to pull through channel © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. How to Design Channels (slide 2 of 4) Selective distribution: limited distribution Usually for complex and/or expensive products that require assistance e.g., Most cars, computers, appliances Push strategy: promote to distribution partners to push goods to consumer Manufacturer has more control due to fewer relationships to manage © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  • 9. ‹#› 10. How to Design Channels (slide 3 of 4) Exclusive distribution: extremely selective e.g., Ferrari and Rolex Manufacturers have the most control May become monopolistic © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. How to Design Channels (slide 4 of 4) How much distribution? Design needs to be consistent with other marketing elements Wide distribution Usually goes with heavy promotion, lower prices, and average or lower-quality products Exclusive distribution Usually goes with less promotion, higher prices, and higher- quality products © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Push vs. Pull Strategies (slide 1 of 2)
  • 10. Push strategy Incentives are offered to distribution partners to push products through the channel Pull strategy Incentives are offered to consumers to pull products through the channel © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Push vs. Pull Strategies (slide 2 of 2) © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Power and Conflict in Channels Conflict arises in distribution channels Some conflict can be healthy Some conflict can end a partnership Power Power is usually defined by size Power can be used to win conflict Exerting power over distribution partners can lead to resentment and lack of cooperation © 2018 Cengage Learning.® May not be scanned, copied or
  • 11. duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Transaction Cost Analysis (TCA) Model that considers channel members’ production costs & governance costs Goal is to minimize both costs Production cost Cost of producing/bringing product to market Governance cost Cost involved with relational issues incurred by coordinating enterprise and controlling one’s partners © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Transaction Value Analysis Perspective that emphasizes the benefits a company brings to its partners Goes beyond cost reductions Uses human relationship terms Communication enhances trust Trust is the willingness and ability to deliver on promises © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  • 12. ‹#› 10. Ways to Resolve Conflict Communicate Exchange personnel Sponsor joint research projects Mediation Negotiate through a third party that determines the two parties’ utility functions Arbitration The third party makes a binding decision for the two parties © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Revenue Sharing (slide 1 of 2) Double marginalization: the problem The manufacturer wants a markup The retailer wants a second markup © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Revenue Sharing (slide 2 of 2) Double marginalization: solutions
  • 13. © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Discussion Question #2 Why wouldn’t the manufacturer just avoid the double marginalization problem entirely and go directly to the consumer? © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Integration (slide 1 of 3) All functions within a channel need to be completed Revisit make-or-buy decision Make: complete a function yourself Buy: outsource a function © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Integration (slide 2 of 3) Vertical integration Moving backward or forward in a channel
  • 14. Forward integration Moving forward in a distribution channel e.g., Manufacturer opens its own retail stores Backward integration Moving backward in a distribution channel e.g., Manufacturer controls raw materials or retailer sets up private label © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Integration (slide 3 of 3) Private label Type of backward integration Advantages Gives retailer negotiating power with manufacturers Offers significant margins Helps differentiate retailer from other retailers e.g., Great Value oatmeal is only at Walmart © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Global Channels Channels can be complicated
  • 15. © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Discussion Questions #3 How might Anheuser-Busch engage in forward integration? How might Google engage in backward integration? © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Retailing & Retail Classifications Retailers have been gaining power and momentum over the past 10–20 years Retailers are classified by ownership, level of service, and product assortment Management’s level of ownership Independent retailers Branded store chains Franchises © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Retailing Classifications Level of service provided Usually related to price points
  • 16. Product assortment carried Specialty: carry depth not much breadth e.g., Toy stores General merchandise: carry breadth but not much depth e.g., Department stores © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Retailing Employees Retail employees are important Connect the retailer and its customers Retailers should hire selectively, train well, and pay fairly Dissatisfied employees can lead to dissatisfied customers and employee turnover Employee turnover leads to new associates who cause further customer dissatisfaction © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Retailing Operations Retailing is a service Retailers should flowchart operations Front-stage: elements customers see Backstage: elements customers do not see
  • 17. Must be run efficiently to support front-stage The goal is to create effective and efficient processes Self-service is a way to streamline © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Retailing Location Location is important Determine appropriate success factors for your specific business; analyze locations to pick ideal sites e.g., Population densities, income and social class distributions, median ages, household composition © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Retailing Growth Strategies Provide additional services Target additional segments Open multiple stores Expand internationally e.g., Exporting, joint ventures, direct foreign investment, and license agreements Global outsourcing e.g., India & technology, China & manufacturing © 2018 Cengage Learning.® May not be scanned, copied or
  • 18. duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Franchising Unique format of multisite expansion Company can retain some control without complete ownership or capital expenditure Benefits Franchisor: receives capital, scales of economy, committed people, less risk, can focus on core functions Franchisee: well-known brand and some market awareness, supplier relationships, templates for training, central support © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Types of Franchising Product franchising Supplier authorizes a distributor in a territory to carry its products, use its brand name, benefit from its advertising, etc. e.g., Ford dealers, Coca-Cola bottlers Business format franchising Company offers a proven system to conduct business, marketing support, brand name, advertising, etc., to the franchisee e.g., McDonald’s, Holiday Inn © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10.
  • 19. E-Commerce The Internet is an important channel Online retail sales are about $180 billion, growing about 10% a year Still only 11% of total retail sales Customers are younger and more affluent Customer characteristics are changing to match customers in general markets United States dominates but not by much © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Asian Internet Penetration Percentages © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Discussion Question #4 How do you see the future for the distribution of entertainment programs? © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#›
  • 20. 10. Catalog Sales Top 10 catalogers are B2B companies e.g., Dell, Staples, etc. 80 of the top 100 catalogers continue to see sales growth Internet is well-suited for a search while catalogs still dominate browsing Catalogs often complement not compete with Internet © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Sales Force (slide 1 of 3) Utilized extensively with a push strategy Important with undifferentiated products Issues How many? How to compensate them? Usually salary plus bonuses Tie compensation to performance evaluation Sales force evaluation factors e.g., Sales, time with clients, expertise © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Sales Force
  • 21. (slide 2 of 3) Sales force size Estimate workload 100,000 stores 12 visits each per year for 30 minutes 50 weeks per year × 40 hours a week = 2,000 hours 500 of these hours will be spent on travel and administrative duties (100,000 accounts × 12 visits per year × 0.5 hour)/1,500 hours = 400 salespeople © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Sales Force (slide 3 of 3) B2B customers’ biggest complaints about salespeople The salesperson isn’t following my company’s buying process They don’t listen to my needs They didn’t bother to follow up © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Discussion Questions #5 What criteria would you utilize to evaluate a car salesperson? How would you tie compensation to this evaluation? © 2018 Cengage Learning.® May not be scanned, copied or
  • 22. duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Integrated Marketing Channels As the number of channels proliferates, increasing care must be taken to coordinate and integrate across them Companies must understand customer behavior in order to design effective distribution channels and to allocate resources across channel options Know your customer! © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Managerial Recap (slide 1 of 2) Distribution channels are the link from the manufacturer to the customer Numerous thoughtful decisions must be made in designing channels © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10. Managerial Recap (slide 2 of 2) Channel entities are independent yet interdependent
  • 23. organizations; thus, conflicts may arise Conflicts are best addressed by employing good communication and trust, revenue sharing, or greater vertical integration © 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ‹#› 10.