Chapter 8 - Using Marketing Channels to Create Value for Customers

Question 1

What are ‘Channel Members’?

Answer 1

Firms a company partners with to actively promote and sell a product as it travels through its marketing channel to users are referred to by the firm

Question 2

What are ‘Intermediaries’?

Answer 2

Organizations that products and services pass through before they getting to the consumer

Question 3

What are the 4 forms of utility/value that channels offer?

Answer 3

• Time
• Form
• Place
• Ownership

Question 4

What is ‘Supply Chain’?

Answer 4

All the organizations that figure into any part of the process of producing, promoting, and delivering an offering to its user

Question 5

What is ‘Supply Chain Management’?

Answer 5

The process of firms constantly monitoring their supply chains and tinkering with them so they’re as efficient as possible

Question 6

What are the types of channel partners?

Answer 6

• Wholesalers

- Retailers

Question 7

What are ‘Wholesalers’?

Answer 7

They resell goods “whole” to other companies without transforming the goods

Question 8

What are the 3 types of Wholesalers?

Answer 8

• Merchant Wholesalers
• Brokers
• Manufacturers Agents

Question 9

What are some types of limited-service wholesalers?

Answer 9

• Cash-and-carry
• Drop shippers
• Mail-order
• Truck Jobbers
• Rack Jobbers

Question 10

What type of wholesaler takes title to the goods?

Answer 10

Merchant Wholesalers

Question 11

What type of wholesaler doesn’t take title to the products they sell?

Answer 11

Brokers

Question 12

What do Brokers do?

Answer 12

Negotiates sales contracts for producers

Question 13

What do Manufacturer Agents do?

Answer 13

Sell units that work directly for manufacturers

Question 14

What are the types of retailers?

Answer 14

• Supermarkets
• Drugstores
• Convenience Stores
• Specialty Stores
• Department Stores
• Warehouse Clubs
• Off-price Retailers
• Outlet Stores
• Online Retailers
• Used Retailers
• Pop-up Store
• Non-store Retailing

Question 15

What are ‘Category Killers’?

Answer 15

Companies that sell a high volume of a particular type of product and dominates the competitions (EX. Best Buy for the electronics market)

Question 16

What are ‘Direct Marketing’?

Answer 16

Companies urge consumers to contact their firms directly to buy products

Question 17

What is ‘Direct Channel’?

Answer 17

A channel consisting of just two parties—a producer and a consumer

Question 18

What is ‘Indirect Channel’?

Answer 18

A channel that includes one or more intermediaries

Question 19

What are ‘Industrial Distributors’?

Answer 19

Firms that supply products that businesses or government departments and agencies use but don’t resell

Question 20

What is ‘Disintermediation’?

Answer 20

When you cut intermediaries out of the deal

Question 21

What are the ways of entering foreign markets?

Answer 21

• Acquiring part or all of a foreign company
• Joint Ventures
• Export your products
• Franchising

Question 22

What is a push strategy?

Answer 22

A manufacturer convinces wholesalers, distributors or retailers to sell its products

Question 23

What is the problem with a push strategy?

Answer 23

It doesn’t focus on the needs of the actual users of the products

Question 24

What is a pull strategy?

Answer 24

Focuses on creating demand for a product among consumers so that businesses agree to sell the product

Question 25

What are the activities organizations in a marketing channel are responsible for?

Answer 25

- Disseminate Marketing Communications and Promote Brands - Sorting and Regrouping Products - Storing and Managing Inventory - Distributing Products - Assume Ownership Risk and Extend Credit - Share Marketing and Other Information

Question 26

What is a 'free on board (FOB) provision'?

Answer 26

A provision that designates who is responsible for what shipping costs and who owns the title to the goods and when

Question 27

What is a nondisclosure agreement (NDA)?

Answer 27

a contract that specifies what information is proprietary, or owned by the partner, and how, if at all, the partner can use that information

Question 28

What are the factors that affect a firm's channel decisions?

Answer 28

- Channel Selection Factors - Type of Customer - Type of Product - Channel Partner Capabilities - The Business Environment and Technology - Competing Products’ Marketing Channels

Question 29

What are the factors that Affect a Products Intensity of Distribution?

Answer 29

- Intensive Distribution Strategy - Selective Distribution - Exclusive Distribution

Question 30

What is 'Intensive Distribution Strategy'

Answer 30

Involves selling products in as many outlets as possible

Question 31

What is 'Selective Distribution'?

Answer 31

Involves selling products at select outlets in specific locations

Question 32

What is 'Exclusive Distribution'?

Answer 32

Involves selling products through one or very few outlets

Question 33

What is a 'Grey Market'?

Answer 33

A market in which a producer hasn’t authorized its products to be sold

Question 34

What is 'Channel Power'?

Answer 34

Ability of a particular channel member to control or influence the decision making and behavior of another channel member

Question 35

What is 'Channel Leaders'?

Answer 35

Strong channel partners

Question 36

What is 'Channe Conflict'

Answer 36

A dispute among channel members

Question 37

What are 'Store Brands'?

Answer 37

Products retailers produce themselves or pay manufacturers to produce for them

Question 38

What is 'Vertical Conflict'?

Answer 38

Conflict that occurs between two different types of members in a channel

Question 39

What is 'Horizontal Conflict'?

Answer 39

Conflict that occurs between organizations of the same type

Question 40

What is 'Dumping'?

Answer 40

The practice of selling a large quantity of goods at a price too low to be economically justifiable in another country

Question 41

What is a 'Vertical Marketing System'?

Answer 41

Channel members formally agree to closely cooperate with one another

Question 42

What is a 'Vertical Integration?

Answer 42

When one channel member takes over the functions of another member

Question 43

What is a 'Backward Integration?

Answer 43

When a company moves upstream in the supply chain

Question 44

What is a 'Horizontal Marketing System'?

Answer 44

Two companies at the same channel level agree to cooperate with another to sell their products or to make the most of their marketing opportunities

Question 45

What is a 'Conventional Marketing System'?

Answer 45

Channel members have no affiliation with one another

Question 46

What is a 'resale price maintenance agreement'?

Answer 46

An agreement whereby a producer of a product restricts the price a retailer can charge for it