Designing And Managing Integrated Marketing Channels

1. Designing and Managing Integrated Marketing Channels

3. … .Marketers realize that if they were to make the brands available in the right size, at the right time and at the right price, the Indian consumer can be motivated to buy it and consume it…..

8. a) Provide information about the market to the manufacturer b) Maintain price stability in the market c) Promotion of the products in his territory d) Financing by providing the necessary working capital in the form of advance payments for goods and services e) Middlemen also take the title of the goods and services and trade in their own name Marketing Channel Functions

11. Marketing Channel Flows

13. Channel Level Decisions that a firm must take regarding the number of channel levels appropriate to serve a given market From zero-directly from the manufacturer to the customer- to as high as 4 to 5 levels involved in distribution. Zero level in industrial product marketing, project marketing

14. Channel level: Firm adopts a one channel level when: a) Number of customers is high b) Customers in specific geographical area c) Order lot size not uniform d) Firm sells goods to wholesaler or a large dealer 2, 3 or even 4 levels in case of: a) Consumer products b) Customers spread across the country c) Market is large

15. Factors determining the length of the Channel a) Size of the market -larger it is more economical it is to serve it directly b ) Order lot size -if it is small, better to have longer channel c) Service requirements -if higher level of service is required, then it is better to have a shorter level d) Product variety -if customers shop for product assortment, a wider channel of distribution is required

16. Manufacturer Customer Customer Wholesaler/ Dealer Manufacturer Zero Level One Level (a) (b) Length of channel distribution

17. Wholesaler/ Dealer Retailer Distributor Customer Manufacturer Manufacturer Wholesaler Retailer Customer Two Level Three Level (c) (d) Length of channel distribution

18. Width of channel of distribution Manufacturer Market 1 Dealer Dealer Dealer Dealer Dealer Dealer Dealer A B C D E F G Retailers Customers Customers Customers

19. Market Market Market Market Market Market Market Market Market Market Market Market Market Market Market Market Market Market Market Market Market Market Market Market Market Market Market Market Market Market Market Market Market Market Market Market Retail spokes-restaurants, soft drink kiosks, panwalsa, sweetmarts Dealer/wholesaler Dealer Hub Franchise Major Hub of Parent Company Hub and spoke pattern of distribution of a soft drink firm

20. Types of Marketing Channels Channels for Consumer Products

21. Types of Marketing Channels Channels for Industrial Products

26. Types of intermediaries Functional Middlemen Merchant Middlemen

27. Types of intermediaries Functional Middlemen Do not take title to products; they simply facilitate the exchange process by performing buying and/or selling functions.

28. Types of intermediaries Merchant Middlemen Take title to products and resell them.

29. Number of marketing intermediaries Exclusive Distribution Selective Distribution Intensive Distribution Intensity at various levels

33. Price policy- the middlemen have to ensure that everyone involved gets a fair and equitable deal Payment terms- the manufacturing firm stipulates the mode and terms of payment Returns policy- this indicates the warranty that the manufacturer extends to the intermediary Territorial rights- the territorial jurisdiction should be spelt spelt out to avoid territory jumping Mutual services and responsibilities- should be spelt out,particularly in case of franchised and exclusive agency channels Terms and Responsibilities of Intermediaries

35. Criteria for Evaluating Channel Alternatives Evolution of Channels Growth Dedicated stores: Computer point Shopper’s stop Mature Department Stores like Akbarallys Decline Discount Store Low cost alternatives like ‘ Discount Sales’ Introductory Specialist Channels like boutiques in fashion/ designer wear Value Added by Channel Members High Low Market Growth Rate Marketing channels across product life cycle

36. Eight Steps in Designing the Market Driven Distribution are: 1. Know what the customers want 2. Decide on the outlet 3. Determine the costs 4. Bound the ‘ideal’ 5. Compare the alternatives 6. Review assumptions in the list of research 7. Confront the gap between the ideal and the actual distribution system 8. Implement changes in the system, if required

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