7 marketing channel and supply chain strategy and management (channel…
7 marketing channel and supply chain strategy and management
individuals and organizations involved in the process of making a product/ service available for consumption or use
individuals and organizations that perform logistical activities required to create and deliver a product/service to user
channel selection decisions
working backward from the ultimate buyer
who are the potential buyers?
where do they buy?
what do they buy?
how do they buy?
design of marketing channels
direct vs indirect
contact end users directly
easily identifiable buyers
personal selling is a major component of the organizations communication program
the organization has a wide variety of offerings for the target market
sufficient resources are available to satisfy target market requirements
when using indirect marketing channel are unable to reach or satisfy market requirements
have to take on all the functions of intermediaries which demand resources. you can eliminate intermediaries but not their functions
the use of intermediaries
electronic marketing channels
which channel and intermediaries will provide the best coverage of the target market?
degrees of density
distribute the offerings to as many retail outlets as possible
exclusive rights to sell a line of products
franchise is a common form
selective in the choice of retail outlets
... will best satisfy the buyer requirements of the target market
types of buyer requirements
important when buyers have limited knowledge or desire specific data about the offering
example high tech
buyers has interest in numerous of competing and complementary offerings from which to choose
example installation and home delivery
... will be most profitable
channel cost is the critical dimension
Dual distribution and multi-channel marketing
when an organization distributes its offering through two or more diffrent marketing channels
same as dual but involves the synergistic blending of e-marketing channel with a traditional marketing channel
incremental revenue or cannibalization
do the channels reach different segments?
are each channel mutually reinforcing in attracting, retaining and building customer relationships?
relationship with stakeholders/suppliers
the dropping of intermediates for direct marketing channel (often e), can be very disruptive for suppliers
satisfying intermediary requirements and trade relations
cutting out the middleman
using power to increase ones own margin as the cost of supplier
not promoting the manufacturers offerings enough
going from being selective/exclusive to intensive
reward or coerce
channel modification decisions
questions which informs whether a modification should be made
will it improve coverage?
will it improve satisfaction of buyer needs?
does the organization has the resources to perform the new functions?
what effect will the change have on the other channel participants?
what will the effect of the change have one long-range objectives?