This document discusses electronic marketing channels and their impact on marketing. It covers topics like disintermediation vs reintermediation, how electronic channels affect the marketing mix, and considerations for channel design, member selection, and management with electronic channels. The key points are that electronic channels create both opportunities and challenges for firms; they require carefully designing a multichannel strategy that considers the roles of both traditional and online channels.

1. Electronic Marketing Channels

2. Electronic Marketing
Channels
Objective 1:
Technology
Internet
Computers
Impact on
Design & Management of Marketing Channels

3. Electronic Marketing
Channels
The use of the Internet to make products & services
available so that the target market with access to
computers or other enabling technologies can shop
& complete the transaction for purchase via
interactive electronic means
Objectives 2 & 3:
Not physical availability
Web-TV, PDAs
Actually purchasing products through the use
of PCs, Web-TV, PDAs

4. Structure of Electronic
Marketing Channels
Three
Key
Phenomena
1. Disintermediation versus
reintermediation
2. Information flow versus
product flow
3. Virtual channel structure versus
physical channel structure

5. Disintermediation and
Reintermediation
Disintermediation Reintermediation
Intermediaries become
superfluous because producers
gain exposure to vast numbers
of customers in cyberspace
Shifting, changing, or adding
middlemen to the channel
Objective 4:
Amazon.com
Auto-By-Tel Corp.
Peapod, Inc.
Dell
Computer Corp.

6. Disintermediation versus
Reintermediation
No matter how
technologically
sophisticated the
Internet becomes or
how much it is hyped,
the laws of economics
as they relate to
channel structure do not
change.
Efficiency in the
performance of
distribution tasks is what
ultimately determines
what form channel
structure will take.
=
The Internet has not eliminated middlemen,
or caused total disintermediation.

7. Internet Limits
Objective 5:
Product Flow
• Cannot be digitized
• Processed slowly, often by people
• Is basis for all other flows—negotiation,
ownership, information, &
promotion

8. Developments & Trends
Objective 6:
• Online shopping has become a routine
shopping choice
• PCs, peripherals, software, & books
accounted for a significant
portion of total retail spending on
these products
Electronic
Marketing
Channels

9. Profile of Online Shoppers
Highest
Percentages
• Age range of 25 to 54
• Income level range $35,000 to
about $99,999
• College graduates & those with
postgraduate education
make up 54%
• Professional/managerial
occupations make up 32%

10. Future of Online Shopping
Online Sales as a Percentage of Total Retail Sales,
1999–2002
Year Online as % of
Retail Sales
% Change from
Previous Year
2019 0.700
2020 0.925 32.1
2021 1.125 21.6
2022 1.300 19.7

11. Advantages & Disadvantages
Objective 7:
Advantages of
Electronic
Marketing Channels
1. Global scope & reach
2. Convenience/rapid transaction processing
3. Information processing efficiency & flexibility
4. Data-based management & relationship capabilities
5. Lower sales & distribution costs

12. Disadvantages of
Electronic
Marketing Channels
1. Lack of contact with actual products & delayed
possession
2. Fulfillment logistics not at Internet speed or efficiency
3. Clutter, confusion, & cumbersomeness of Internet
4. Nonpurchase motives for shopping not addressed
5. Security concerns of customers
Advantages & Disadvantages

13. Implications
Objective 8:
• Objectives & strategies of the firm & electronic
marketing channels
• Role of electronic marketing channels in the
marketing mix
• Channel design & electronic marketing channels
• Channel member selection & electronic marketing
channels
• Channel management & electronic marketing
channels
• Evaluation & electronic marketing channels

14. Objectives & Strategies of the Firm
Role of distribution more complex because
of electronic marketing channels
=
Channel manager must consider whether
Internet-based channels fundamentally affect
the firm’s decision about the priority
given to distribution

15. The Internet arms large numbers of customers with
more information about products & services
to level the playing field
The fourth P, place (distribution), may assume a
larger role relative to the other three variables for
more & more firms
The Marketing Mix

16. Channel Design
The channel manager of retailers, industrial, and B2B
markets should provide “channel-surfing” consumers
with whatever channels or combinations of channels
they desire
=
A facet of the development of an
effective multichannel marketing strategy

17. Channel Member Selection
Complexity grows as channel member selection may
include the need to avoid conflict with conventional
channel members
=
The need to select members carefully

18. Channel Management
Multichannel challenge of conventional and
electronic channels
=
The fundamental issues of motivating channel members,
building cooperation, managing conflict, &
coordinating elements of the marketing mix requires
manager’s full attention

19. Evaluation
Likely to change Unlikely to change
Specific criteria for Performance expectations,
performing evaluations & criteria, & measurement of
technological means for how well they are being met
doing so by channel members