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Marketing Channels

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Marketing Channels

  1. 1. Chapter 15 Managing Marketing Channels
  2. 2. I. What is the place element of the marketing mix? <ul><li>Place is concerned with making products available in the right quantities and locations when customers want them. </li></ul>
  3. 3. II. What is a marketing channel ? <ul><li>Any series of firms or individuals who participate in the flow of goods and services from producer to final user </li></ul>
  4. 4. III. Intermediaries <ul><li>A. Types </li></ul><ul><ul><li>Retailer </li></ul></ul><ul><ul><li>Wholesaler </li></ul></ul><ul><ul><li>Agent </li></ul></ul><ul><li>B. Value Created by Intermediaries </li></ul><ul><ul><li>Improve exchange efficiency </li></ul></ul><ul><ul><li>Perform marketing functions </li></ul></ul><ul><ul><li>Eliminate assortment / quantity discrepancies </li></ul></ul>
  5. 5. Slide 15-8 FIGURE 15-A Types of Intermediaries
  6. 6. Slide 15-10 FIGURE 15-2 How intermediaries improve exchange efficiencies
  7. 7. IV. Channel Structure Decisions
  8. 8. A. Direct Vs. Indirect Channels <ul><li>Direct channel- a marketing channel that does not use intermediaries to distribute the product. </li></ul><ul><ul><li>Why sell directly? </li></ul></ul><ul><li>Indirect channel – a marketing channel where intermediaries are used to help distribute the product. </li></ul><ul><ul><li>Why sell indirectly? </li></ul></ul>
  9. 9. Slide 15-15 FIGURE 15-4 Examples of direct and indirect channels
  10. 10. B. Target Market Coverage <ul><li>Intensive distribution </li></ul><ul><ul><li>What is it? </li></ul></ul><ul><ul><li>When is it used? </li></ul></ul><ul><li>Selective distribution </li></ul><ul><ul><li>What is it? </li></ul></ul><ul><ul><li>When is it used? </li></ul></ul><ul><li>Exclusive distribution </li></ul><ul><ul><li>What is it? </li></ul></ul><ul><ul><li>When is it used? </li></ul></ul>
  11. 11. C. Dual Distribution <ul><li>Occurs when an organization distributes its product through two or more different types of marketing channels which typically compete for the same target market. </li></ul><ul><li>May cause conflict with channel intermediaries </li></ul>
  12. 12. V. Vertical Marketing Systems <ul><li>What is a VMS? </li></ul><ul><li>A marketing channel that a single channel member coordinates </li></ul><ul><li>Types of VMS </li></ul><ul><ul><li>Corporate </li></ul></ul><ul><ul><li>Contractual </li></ul></ul><ul><ul><li>Administered </li></ul></ul>
  13. 13. VI. Factors to Consider When Selecting Specific Intermediaries <ul><li>The producer will want to use intermediaries who: </li></ul><ul><li>Reach their target market </li></ul><ul><li>Have a good reputation </li></ul><ul><li>Handle distribution functions efficiently </li></ul><ul><li>Order large quantities </li></ul><ul><li>Pay invoices quickly </li></ul><ul><li>Display and promote merchandise well </li></ul><ul><li>Have a good location and professional salespeople </li></ul>