Part IV (Ch 16 + 17) Flashcards
What are the 5 external determinants of channel decisions?
- Customer characteristics
- Nature of the product
- Nature of demand/location
- Competition
- Legal regulation / local business practices
What are customer characteristics?
Size, geographic distribution, shopping habits, outlet preferences, usage patterns
What is Keiretsu?
A network of businesses that own stakes in one another as means of mutual security, especially used in Japan. This usually includes large manufacturers and their suppliers of raw materials and components
What can market coverage relate to?
Coverage can relate to the geographical areas or number of retail outlets
What are the 3 market coverage approaches?
- Intensive coverage
- Selective coverage
- Exclusive coverage
What is intensive coverage?
Distributing the product through the largest number of different intermediaries
What is selective coverage?
Choosing a number of intermediaries for each area?
What is exclusive coverage?
Choosing only one intermediary in a market
What is channel length?
Number of levels in the distribution channel
What is channel integration?
The process of incorporating all channel members into one channel system and uniting them under one leadership and one set of goals
What is vertical integration?
Seeking control of channel members at different levels of the channel e.g. the manufacturer’s acquisition of the distributor
What is horizontal integration?
Seeking control of channel members at the same level of the channel, e.g. the manufacturer’s acquisition of the competitor
What is the multiple channel strategy?
A product/service is available to the market through more channels of distribution. All the channels are in principle available to the customer bu the channels themselves are not integrated
What are the benefits of the multiple channel strategy? (5)
- Extended market coverage
- Increased sales volume
- Lower costs
- Better accommodation of customers’ evolving needs
- More and better information
What are the disadvantages of the multiple channel strategy? (5)
- Consumer confusion
- Conflicts with intermediaries
- Increased costs
- Loss of distinctiveness
- Increased organizational complexity
What is the omnichannel strategy?
All the channels are available to the customer, and the channels are also integrated and connected. The purpose is to deliver experiences and value through the whole customer journey
What are the 5 qualifications you look at for selecting a distribution channel?
- Financial and company strengths
- Product factors
- Marketing skills
- Commitment
- Facilitating factors
By committing which 3 things can you support market entry?
- money
- managers
- proven marketing ideas
What is blockchain?
A blockchain is a growing list of records called blocks, which are linked and secured by using cryptography. It stores information about transactions between users to its database, conducted without intermediaries, in a way that transactions can be tracked by any user forever with maximum transparency
What is disintermediation?
The elimination of a layer of intermediaries from a marketing channel or the displacement of traditional resellers by radically new types of intermediaries
What is channel conflict?
Disagreement among marketing channel members on goals and roles. A significant threat arising from the introduction of an internet channel is that, while disintermediation gives the opportunity for a company to sell direct and increase the profitability of products, it also threatens distribution arrangements with existing partners
What does IDR stand for (IDR cycle)?
Intermediation, disintermediation, reintermediation
What is intermediation?
Occurs when a firm begins a middleman between two industry players
What is disintermediation?
Occurs when an established middleman is pushed out of the value chain
What is reintermediation?
Occurs when a once disintermediated player is able to re-establish itself as an intermediary
What are the benefits of mobile marketing for consumers? (4)
- Comparison shopping
- Bridge the gap between brick and clicks
- Opt-in searches (alerts when available)
- Travel
What are the benefits of mobile marketing for merchants? (6)
- Impulse buying
- Drive traffic
- Education of consumers
- Perishable products
- Drive efficiency
- Target market
What does channel power mean?
The ability of a channel member to control marketing variables of any other member in a channel at a different level of distribution
What is concentration in retailing
Here fewer retail chains dominate a huge part of the retail trade and creat huge buying power in the big international chains
What does the dominance shift from manufacturer to retailer result in?
More private labels
What is a private label?
These products are typically manufactured by one company for offer under a retailer’s brand. These are often positioned as lower-cost products compared to premium brands
What are key accounts?
The most important customers for the manufacturer because they contribute to a large portion of the company’s sakes creating and maintaining a long term relationship
What is grey marketing?
Importing and selling product through market distribution channels that are not authorized by the manufacturer. It occurs when the manufacturer uses significantly different market prices for the same product in different countries and mainly exists for high-prices
What are possible strategies to reduce grey marketing
- Seek legal redress
* Change marketing mix
What are the two types of communication?
- One way communication
- Two way communication
What is one-way communication?
Mass communication, advertising, public relations, sales
What is two-way communication?
Personal, close communication e.g. direct marketing, personal selling
What are the 5 steps of advertising?
- Objective setting
- Budget decisions
- Message/ Media decisions
- Agency selection
- Advertising evaluation
What is an advertising objective?
A specific communication taks to be accomplished with specific target audience during a specific period of time
What are the 3 different budget approaches?
- Affordable approach
- Competitive party approach
- Objective and task approach
What is the affordable budget approach?
Setting the promotion budget at the level management thinks the company can afford
What is the competitive party approach?
Setting the promotion budget to match competitors outlays
What is the objective and task approach?
Developing the promotion budget by defining specific objectives, determining the tasks that must be performed to achieve these objectives and estimating the costs of performing these tasks
What does USP stand for?
Unique selling proposition
What is a USP?
A unique characteristic of a product or brand is identified by the marketer as the one on which to base a promotional campaign. It is often used in a product-differentiation approach to promotion
What three criteria can media selection be based on?
- reach (the number of people who see it)
- frequency (the number of times within a time period each potential customer is exposed to the ad)
- impact (the impact on the consumer’s brain)
What does GRP stand for?
Gross rating points
What is GRP?
Reach multiplied by frequency.
GRPs may be estimated for individual media vehicles. Media planning is often based on ‘cost per 1000 GPR’
What does CMP stand for?
Cost per thousand
What is CMP?
Calculated by dividing the cost of an ad placed in a particular advertisement vehicle by the number of people that are exposed to that vehicle
What are different mediatypes? (6)
- TV
- Radio
- Newspapers
- Magazines
- Cinema
- Outdoor advertising
What are selection criteria for agency selection? (3)
- Policy of the company
- Nature of the advertising to be undertaken
- Type of product
What do public relations seek?
Seeks to enhance corporate image building and influence favorable media treatment
What is sponsorship?
A business relationship between a provider of funds, resources or services and an individual event or organization which offers in return some rights and association that may be used for commercial advantages
What is celebrity endorsement?
The use of famous spokespersons in marketing communications
What is product placement?
The inclusion of a branded product in media, usually without explicit reference to the product. Most commonly branded products are featured in movies, television shows and video games
What are the 5 different types of sales promotion?
- Price discounts
- Catalogues
- Coupons
- Samples
- Gifts
As what is sales promotion defined?
Those selling activities that do not fall directly into the advertising or personal selling category
What is an advertising agency
A marketing services firm that assists companies in planning, preparing, implementing and evaluating all or portions of their advertising programs
Point-of-sale displays
Includes signage and a variety of other visual materials that are designed to influence buying decisions
What is cross selling?
Selling an additional product or service to an existing customer
What is direct marketing?
the sum of the total activities by which products and services are offered to market segments in one or more media for informational purposes or to solicit a direct response from a present or prospective customer
What is personal selling?
a two-way communication process with immediate feedback
What are the 3 types of international sales forces?
- Expatriates
- Host country
- Third country
What is the creative challenge?
Creating a global campaign concept that meets global brand aims and is adaptable for local market need
What is the implementation challenge?
Planning and managing the project from inception, through the key localization stages all the way to the launch
What are the SMART objectives?
Specific, measurable, achievable, realistic, time-related
What is social media marketing about?
Using social networks and tools to guide prospect customers through a series of steps to get them to the desired action
What is viral marketing?
Online word-to-mouth marketing technique that seeks to exploit existing social networks to produce exponential increases in brand awareness
