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MARKETING MIX - PLACE (DISTRIBUTION CHANNELS) (Collaborative Distribution,…
MARKETING MIX - PLACE (DISTRIBUTION CHANNELS)
Distribution Channels
Known as "value delivery network" including suppliers and distributors
Functions performed by channel members include:
Information
Promotion
Contact
Matching
Negotiation
Financing
Risk Taking
Traditional/Vertical distribution channels
Traditional (typical):
Manufacturer -> Wholesaler -> Retailer -> Consumer
Each member is independent so can pursue own goals as well as cause conflict and cooperation with other members
Vertical Marketing System (VMS)
[Manufacturer, Wholesaler, Retailer] -> Customer
Channel members unified under leadership of one channel memeber
Corporate VMS (owning other channel members
Contractual VMS (contractual arrangements)
Administered VMS (exerting control through power or size)
Collaborative Distribution
Horizontal distribution channels
Org's are on same level
May merge or join on temp basis for marketing opp.
4 Types of collab. distribution
(shipping)
Backhaul (sharing opposite routes to fill empty capacity)
Co-loading (sharing capacity in same directed to fill loads)
Continuous move routing (replace seperate shipments with multi-stop trips)
Physical internet (shared network of logistics for shared facilities for transport and storing freight)
Multiple Distribution Channels
Many org's multiple channels to service differing segments and offers multiple channel options through which to buy
Channels
In Store
Internet
Phone
Order forms
Catalogues
Choosing the right channel
Distribution objectives and choices can be influenced by
level of service they wish to provide
size of the company
Type of product
Competitors
Environmental factors (STEEPLE)