Exam 3 Flashcards
Includes the physical handling of goods, passage of ownership or title, and the buying and selling of negotiations
the distribution process
A channel of distribution is selected with a variety of middleman whose functions reflect competition, market characteristics, tradition, and economic development
distribution structure
An importer controls a fixed supply of goods limited to a small amount of customers from a limited supply of middleman
import oriented distrobution structure
What are the four features of the Japanese distribution structure
small middlemen with small retainers
channel control by manufacturers
philosophy shaped by culture
laws that protect foundation
what does the value system in japan support?
long term dealer- supplier relationships that are difficult to change
This law is designed to protect small retailers from large intruders by making stores seek permission to expand, change hours, and days of operation
The large scale retail store law (Daitenho)
Work on commission and arrange for sales in the foreign country but do not take the title to the merchandise
agent middleman
Take the title to the manufacturers goods and assume the trading risk so they are less controllable.
Criticized about not representing the best interest of the manufacturer
merchant middleman
Selling to the customer through mail telephone door-to-door etc.
Is considered to be insufficient or an under developed system
has been effective in foreign markets
Direct selling
Are located in the firms producing country and used when marketer is uncertain or wants to minimize investment
home country middleman
What are the six factors affecting choices of channel
cost capital control coverage character continuity
the two kinds of channel costs are:
capital or investment cost
cost of continuing to maintain
this area is often overlooked but cash flow patterns and controlling capital investment are critical
capital requirements
more distribution involved the more __ exerted
longer channels reduces this
having your own sales force gives more of this but is not practical
control
full__ is the goal but is difficult to attain
must gain optimum sales, secure market share and good market penetration
coverage
channel must coincide with company ___
patterns are changing and cannot assume further work is not needed
character
channels often pose longevity problems
distribution can be lost when a middleman retires or moves on due to little loyalty
distributors and dealers are most loyal
brand loyalty flows down stream
continuity
what are the 6 integrated marketing communications tools
advertising personal selling sales promotion direct selling trade shows public relations
what are generally the two biggest integrated marketing communications for companies
advertising and personal selling
create a good relationship with the press and media
sponsor sports teams
communicate with the public
Public relations
global mass media is a powerful tool but gets scrutiny
decisions in this area are most affected by culture
advertising
what are the seven steps for advertising
market research
goals of communication
most effective message for the segment selected
select effective media
compose & secure budget based on meeting goals
execute campaign
evaluate campaign relative to goals
what are some reasons the message can fail?
does not get through due to inadequacy
misunderstood due to culture
understood but ineffective due to improper assessment
what are the 7 components of the communication process
information source encoding message channel decoding reciever feedback noise
Communication Process:
marketing executive with a product message to communicate
information source
Communication Process:
the message from the source converted into effective symbolism for transmission into a reciever
encoding
Communication Process:
sales force and/or advertising media that convey the encoded message to the intended reciever
message channel
Communication Process:
the interpretation by the reciever of the symbolism transmitted from the information source
decoding
Communication Process:
the consumer action by those who receive the message and are the target for the thought transmitted
reciever
Communication Process:
info about effectiveness of a message that flows from receiver back to source for evaluation of effectiveness
feedback
Communication Process:
uncontrollable and unpredictable influences that detract from the process and affect any or all steps
noise
what are some common promotional misfires
cultural context impacting the meaning of a message
a decoding error causing incorrect patterns, or mistakes
a marketing strategy where a company’s product or service is presented as superior compared to a competitor
compararative advertising
no unit of similar product is different in cost from others; each must bear the full share of costs
full cost
firms are only concerned with marginal or incremental cost of producing goods to be sold overseas
variable cost
used to reach a segment of the market that is price insensitive and willing to pay for the product
skimming
stimulate market and sales by offering products at a low price
penetration pricing
the added costs incurred as a result of exporting products from one country to another
price escalation
a fee charged when goods are brought into a country from another country
considered a special form of taxation
tariff
what are the three types of tariff
specific
ad valorem
compound
what is a specific tariff
flat charge per unit
what is an ad valorem tariff
percentage of the value imported
what is a compound tariff
both a flat charge and percentage (specific and ad valorem)
causes consumer prices to escalate potentially excluding them from the market
causes higher cost of goods and production costs
inflation
creates low costs in the market that is good for consumers but puts pressure on the supply chain
Japan is currently dealing with this
deflation
when lowering COG it affects the entire chain
manufacturing in another country can also reduce labor costs
These changes can potentially help reduce what?
price escalation
How do you lower tariffs?
reclassify them into a different grouping for new rate
repackage them for new judgement call
what are the 4 ways a tariff could be reassessed
- cheaper if unassembled
- cheaper if country can save on final product
- transport volume is less by being unassembles
- packaging and other components can be used for final assembly
products sold below the cost of production or…
selling goods in a foreign market below the price of goods in the home market
dumping
rarely an issue when markets are strong
tends to have greater risk than an outright sale but people still do it
leasing
