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Marketing Final > Chapter 10: Place (Distribution) and Market Research > Flashcards

Chapter 10: Place (Distribution) and Market Research Flashcards

1
Q

What is a marketing channel

A

A marketing channel consists of the people, organizations, and activities necessary to transfer the ownership of goods from the point of production to the point of consumption.

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2
Q

Why is a marketing channel needed?

A
  • Customers’ desire for product assortment
  • Better rate of return on core business
  • Improve efficiencies of distribution
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3
Q

3 Types of Marketing Channels

A
  1. Manufacturer -> Customer
  2. Manufacturer -> Retailer -> Customer
  3. Manufacturer -> Wholesaler -> Retailer -> Customer
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4
Q

What determines a marketing channel?

A

Characteristics of the Product
- Product or service
- Price
- Complexity
- Demonstration

Characteristics of the Customer
- Decision maker/decision making process
- Familiarity with product
- Shopping habit/places

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5
Q

Unique role of channel members

A

Collaborators
- Common interest to make the sale and grow
- Share information
(Increase size of the pie)

Competitors
- Want more share of the margin
- Retailers interested in selling competitor’s products
- Retailer selling own (store) brand
- The brand sells to other retailers
(Compete over the share of the pie)

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6
Q

Channel Functions: Physical Distribution

A

Physical Distribution
- Ordering (assortment, lot size,
availability..)
- Transportation and logistics
- Holding inventory
- Risk-taking

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7
Q

Channel Functions: Selling activities

A

Selling activities
- Promotion & Demand Generation
- Contact with prospective customers
- Negotiation

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8
Q

Channel Functions: Information/Market Feedback

A

Information/market feedback
- On Product, Customer, Competition…

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9
Q

Channel Functions: Service

A

Service
- Customization of augmented product
- Financing

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10
Q

Channel Member’s Economic Role

A

Manufacturer’s Transferred Business Cost to Channel Member:
- Inventory
- Order Handling
- Selling
- Credit

Channel Members: Wholesalers, Retailers, and Distributors.

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11
Q

Characteristics of Distribution Schemes

A

For Exclusive Distribution:
- # of Distributors/Retailers: One
- Market Coverage: Less Important
- Product Category: Specialty
- Profit margin: High

For Selective Distribution:
- # of Distributors/Retailers: Limited but more than one
- Market Coverage: Moderate
- Product Category: Specialty and some Shopping
- Profit Margin: Moderate

For Intensive Distribution:
- # of Distributors/Retailers: All Suitable
- Market Coverage: Critical
- Product Category: Convenience
- Profit Margin: Low

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12
Q

Channel Management Decisions

A

a. Selecting channel members
- Financial capability
- Stake in your firm and switching costs
- Category experience
- Organizational skills
b. Motivating Channel Members
- Promotions
- Training services
- Financing options
c. Evaluating Channel Members
- Sales quota attainment
- Customer service levels
- Treatment of lost and damaged goods

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13
Q

Distribution Systems

A
  1. Conventional marketing channel
    - M-W-R-C
  2. Vertical marketing system
    - MWR-C
  3. Horizontal marketing system
    - (M1+M2)-C
  4. Hybrid marketing system
    - M-W-R-C1
    - M-C2
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14
Q

Channel Conflict

A
  1. Vertical
    - Coca-Cola and bottlers wanting to bottle Dr. Pepper
  2. Horizontal
    - Some Ford dealers complain about other dealers being too aggressive in their pricing
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15
Q

Managing Channel Conflict

A
  • Diplomacy
  • Focus on common goals
  • Exchange of personnel
  • Joint membership in trade associations
  • Arbitration/mediation
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16
Q

4 Steps of Channel Design

A
  1. Find out what your customers want
  2. Identify alternatives, determine costs
  3. Bound the “ideal”. Impose constraints
  4. Evaluate and Compare Alternatives
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17
Q

Why is Marketing Research Necessary?

A

Value of Information:
- Decisions involve risk and uncertainty
when information is imperfect
- Information eliminates (or at least reduces) risk and uncertainty

18
Q

Purpose of Marketing Research

A

To collect useful information

19
Q

How can marketing research help?

A
  • It can reduce risk and uncertainty
  • It takes out some of the guess
    work involved in making marketing
    decision
  • It can supplement (not replace)
    good sense
20
Q

Why is Marketing Research Necessary?

A
  • Competitive Pressure
  • Expanding Markets
  • Increasing Customer
    expectations

Mistakes can be costly

21
Q

Why study research methods? what is the purpose?

A
  • Information of higher accuracy is more valuable
  • Study of research method gives insight into accuracy and reliability
    of information being generated
22
Q

(4 Steps) Marketing Research Process

A
  1. Formulate Research Problem
  2. Develop Research Plan: Research Objectives
    Exploratory, Descriptive, Causal
  3. Implement Plan:
    a. Identify Data Source: Primary, Secondary
    b. Develop Questionnaire Design, Sample Size
  4. Analysis and interpretation
    a. Analysis
    b. Reporting
23
Q

Stage 1: Problem Formulation

A
  • Decision Problem: What should the manager do?
    –> You (manager) must develop a new product package.
  • Research Problem: What
    information is needed, and how do you obtain the information?
    –> Evaluate effectiveness of alternative package design:
  • Product freshness
  • Visual Appeal
  • Comparison to other options
  • Comparison to competition
24
Q

Stage 2, Develop Plan: Sources of Data

A

Primary: Data gathered for the specific problem
at hand
- Demographics, psychographics, attitudes, intentions,
behavior

Secondary: Data that have been previously
gathered for some purpose. Relatively
inexpensive and fast, but inaccurate and ill-
fitting the problem
- Internal: Sales data, warranty cards
- Published: Directories, periodicals, statistical sources
- Commercial: Ad exposures, scanner data, store audits

25
Q

Stage 2: Develop Plan and Research Design

A

Research Objectives:
a. To Define the Problem and Suggest Hypotheses:
Exploratory Research:
- To gain ideas and insights
- Newspaper facing decreasing sales generates possible
explanations

b. To Describe Market Situation: Descriptive
Research:
- To obtain summary measures
- Trends in lifestyle of current users

c. To Predict Hypothesis about Cause and Effect:
Causal Research:
- For cause-effect connection
- How people react to a newspaper’s topic selection and space
allocation

26
Q

Different ways to Operationalize

A
  1. Exploratory
  2. Observation and Focus groups
  3. Qualitative research
  4. Descriptive
  5. Survey
  6. Quantitative
  7. Causal Research
  8. Experiments
  9. Hypothesis
27
Q

Exploratory

A
  • No sense of what is going on, why
  • Need to find out more even to form a hypothesis
  • Provides a starting point
28
Q

Observation and Focus groups

A
  • Best suited for exploratory research
  • Observing consumer behave (in stores) gives
    pointers to ‘why’ they behave
  • In-depth interviews
  • Focus groups
29
Q

Qualitative Research

A

Very special skills to get it right!

30
Q

Descriptive

A
  • Need to get quantitative estimate of sizes
  • Sample size critical
31
Q

Survey

A
  • Best suited for descriptive research
  • You have a sense of what you want to find out –
    need to get a sense of population proportions
  • Design of survey is critical - wording, ordering,
    response format
  • Do not want to bias the responses
    [Note: all surveys should be pre-tested]
32
Q

Quantitative

A

Requires good quantitative skills to analyze data

33
Q

Causal Research

A

Need to establish causality: ‘x’ causes ‘y’; e.g.,
change in price affects sales

34
Q

Experiments

A
  • Take comparable situations – just change one
    element to test its effect. (e.g., two similar cities
    with high vs. low price  effect on sales)
  • Test market is another example
35
Q

Hypothesis

A

Specific hypothesis being tested

36
Q

Stage 3, Implement Plan: Developing the Questionnaire (survey)

A

Specify what information is sought
- Determine method of administration
- Determine content, wording, response format
for each question
- Determine question sequence
- Pretest questionnaire and revise if necessary

37
Q

Stage 3, Implement Plan: Sampling

A
  • Simple random sampling: Each element of population
    has an equal probability of being selected
  • Stratified sampling: Entire population is divided into
    strata, and do simple random sampling from each
    stratum
  • Cluster sampling: Entire population is divided into
    clusters –each representing the population, and do
    random sampling of clusters
  • Key considerations:
    a. Cost: Sample size, method of data collection
    b. Information accuracy: Sample representativeness,
    respondent error, administrative error
38
Q

Contact Methods (For primary data collection)

A
  • Mail
  • Telephone
  • Internet
  • Personal
    a. individual (one-on-one)
    b. group (focus groups)
  • Sampling Plans (for primary data collection)
    a. Who to survey? (individuals? families?)
    b. How many people?
    c. Sampling procedure?

Q: How reliable and/or valid are the results?

39
Q

Typical Problems in Wording Questions

A
  1. Leading question
  2. Ambigous question
  3. Unanswerable question
  4. Two questions in one
  5. Non-exhaustive question
  6. Mutually non-exclusive question
40
Q

Stage 4, Analysis and Reporting

A
  • Did the research meet its objectives?
  • Was the information helpful in making the
    decision? Did the managers use the information?
  • Was there an ‘aha’ factor?
  • Did the analysis throw open some additional
    issues?
41
Q
A

Marketing Final (9 decks)

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