Marketing Channels Flashcards
(Supply Chains and the
Value Delivery Network)
Supply chain
“make and sell” view includes the
firm’s raw materials, productive inputs, and
factory capacity.
(Supply Chains and the
Value Delivery Network)
Demand chain
“sense and respond” view suggests that planning starts with the needs of the target
customer.
(Supply Chains and the
Value Delivery Network)
Value delivery network
is composed of the company, suppliers, distributors, and, ultimately, customers who partner with each other to improve the performance of the entire system.
(The Nature and Importance of Marketing Channels) Marketing channel (distribution channel)
is a set of interdependent organizations that help make a product or service available for use or consumption by the consumer or business user.
(The Nature and Importance of Marketing Channels)
How channel members add value
= information = promotion = contact = matching = negotiation = physical distribution = financing = risk taking
Channel behaviour
Marketing channels consist of firms that have partnered
for their common good with each member playing a
specialized role.
(Channel Behavior)
Channel conflict
refers to disagreement among channel members over goals, roles, and rewards.
(Channel Behavior and Organization)
Multichannel Distribution Systems
are systems in which a single firm sets up two or more marketing channels to reach one or more customer segments.
(Changing Channel Organization)
Disintermediation
the cutting out of marketing channel intermediaries by producers or the displacement of traditional resellers by new intermediaries.
For example, Amazon.com almost single-handedly bankrupted the bookseller giant, Borders, in less than 10 years. And the burgeoning online-only merchant has recently forced highly successful store retailers such as Best Buy to dramatically rethink their entire operating models.
Channel Design Decisions
= Analysing consumer needs
= Setting channel objectives
= Identifying channel alternatives
= Evaluating alternatives
In designing marketing channels, manufacturers struggle between what is ideal and what is practical. A new firm with limited capital usually starts by selling in a limited market area. In this case, the problem is not deciding on the best channels but how to convince one or a few good intermediaries to handle the line.
Channel Management Decisions
Selecting channel members ↓ Managing channel members ↓ Motivating channel members ↓ Evaluating channel members
(Public Policy and Distribution Decisions)
Exclusive distribution
when the producer gives only a limited number of dealers the exclusive right to distribute its products in their territories.
(Public Policy and Distribution Decisions)
Exclusive dealing
when the seller requires that the exclusive distribution sellers not handle competitor’s products.
(Public Policy and Distribution Decisions)
Exclusive territorial agreements
where producer or seller limit territory.
(Public Policy and Distribution Decisions)
Tying agreements
agreements where the dealer must take most or all of the line.
