A marketing channel is a set of practices or activities necessary to transfer the ownership of goods, from the point of production to the point of consumption.

1. Marketing Channels

2. Contents
Marketing Channels – An Intro
1
Channel Design
2
Channel Evaluation
3
Channel Management
4

3. Marketing Channels
They are set of interdependent organizations involved
in all the marketing activities and process of making a
product or service available for use or consumption.

4. Intermediaries
Merchants: Intermediaries who buy, take title to and resell the
merchandise.
Agents : Brokers, manufacturers representatives, sales agents who
search for customers & negotiate for producers.
Facilitators: Who assist in the distribution process .
Ex :Warehouses, ad agencies , logistic companies etc.
( Distribution function only)

5. Importance – Marketing channels
a) Creation of markets
b) Creation of potential buyers
c) Involved in the distribution of products and services.

6. Push and Pull strategy
Push strategy:
Involves use of manufacturers sales force, trade promotion and
other means to induce intermediaries to promote the product .Used
when there is low brand loyalty in the category
Pull strategy:
In this advertisement, promotion and other forms of communication
is used to persuade the consumers. Its used when there is high
brand loyalty & involvement.

7. Multi channel Marketing
Hybrid or Multichannel marketing – when firm uses two
or more marketing channels to reach the customer segments.
Channel integration is expected by customers.

8. Value networks
It’s a system of partnerships and alliances that a firm creates to
source, augment and deliver its offerings. Suppliers, immediate
customers and end customers are part of it .

9. Demand chain planning
Company first think of the Target market and then design the
supply chain backward from that point.

10. Channel Functions
• Gather information
• Develop and disseminate persuasive communications
• Reach agreements on price and terms
• Acquire funds to finance inventories
• Assume risks
• Provide for storage
• Provide for buyers’ payment of their bills
• Oversee actual transfer of ownership

11. Channel levels
• Zero level Direct marketing channel .
• Two level and Three level marketing channels

12. Consumer & Industrial marketing channels

13. Service channels
Service industries utilizing Internet, mobile and other
technologies .

14. Designing a Marketing Channel System
Analyze customer needs
Establish channel objectives
Identify major channel alternatives
Evaluate major channel alternatives

15. Channel Service Outputs
• Lot size: Number of units the channel permits a typical customer
to purchase on one occasion
• Waiting/delivery time: Average time customers of that channel
wait for receipt of the goods
• Spatial convenience: degree to which the marketing channel
makes it easy for customers to purchase the product
• Product variety: assortment breadth provided by the marketing
channel

16. Identifying Channel Alternatives
Types of
intermediaries
Number of
intermediaries
Terms and
responsibilities

17. Strategies adopted based on no of intermediaries include
I. Exclusive distribution : Limited number of intermediaries.
II. Selective distribution : Relies on only some of the intermediaries
for a particular product.
III. Intensive distribution : large number of intermediaries involved.

18. Terms and responsibilities of
intermediaries
• Price policy—price list and schedule of discounts and allowances
for the intermediaries
• Condition of sale —payment terms and producer guarantees
• Distributors’ territorial rights—distributors’ territories and the
terms under with the producer will enfranchise other distributors
• Mutual services and responsibilities

19. Evaluation criteria of Channel
alternatives
a) Economic
b) Control
c) Adaptive

20. The Value-Adds Versus Costs of
Different Channels

21. Channel Management
decisions
Selecting channel members
Training channel members
Motivating channel members
Evaluating channel members
Modifying channel members

22. Training and motivating channel
members
Training , MR and other capacity building programmes to
motivate and improve intermediaries performance

23. Channel Power
• Ability to alter channel behavior so they function in a desired
• way which they would not have . Different types of channel power
• Coercive--threat
• Reward—extra benefit
• Legitimate--contract
• Expert--knowledge
• Referent—proud to be associated