Channels and marketing Decisions, Functions, Channel Management Decisions, Channel Conflict, Designing and Managing Integrated Marketing Channels

1. Designing and Managing
Integrated
Marketing Channels

3. What is a Marketing Channel?
A marketing channel system is the
particular set of interdependent
organizations involved in the process of
making a product or service available for
use or consumption.

4. Channels and
Marketing Decisions
 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.

5. Categories of Buyers
Habitual shoppers
High value deal seekers
Variety-loving shoppers
High-involvement shoppers

6. Types of Shoppers
 Service/quality customers
 Price/value customers
 Affinity customers

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

8. Marketing Channel Flows

9. Too many middleman!

10. Figure 15.3
Consumer Marketing Channels

11. Figure 15.3
Industrial Marketing Channels

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

13. Channel Service Outputs
Lot size
Waiting/delivery time
Spatial convenience
Product variety
Service backup

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

16. Number of Intermediaries
Exclusive
Selective
Intensive

17. Terms and Responsibilities
of Channel Members
 Price policy
 Condition of sale
 Distributors’ territorial rights
 Mutual services and responsibilities

18. The Value-Adds vs. Costs of
Different Channels

19. Channel-Management Decisions
Selecting channel members
Training channel members
Motivating channel members
Evaluating channel members
Modifying channel members

20. Channel Power
 Coercive
 Reward
 Legitimate
 Expert
 Referent

21. What is Channel Conflict?
 Channel conflict occurs when one
member’s actions prevent another channel
from achieving its goal.
 Types of channel conflict
 Vertical
 Horizontal
 Multichannel

22. Case Study – Titan Watches
 Sold through Seven different stores.
 World of Titan
 Time Zone
 Valuemart
 Sonata Stores
 Titan Signet Club
 Tanisqu boutiques

23. Case study- HUL
 100 brands and 100 plants
 1, 000 products company distribute them
nationally through network of four
warehouses, more than 40 agents, 75,00
wholesalers and a number of instutional
customers
 Project Shakti – 2001 – through SHGs