Channel management

Channel management

1. Channel Management Ribhu Vashishtha NU-MBA 2011-13

2. A set of interdependent organizations (intermediaries) involved in the process of making a product or service available for use or consumption. Also known as “ Value Network ” What are marketing channels? 12-12-2011 Ribhu Vashishtha-Channel Management 2

3. What is channel management? The broad principles by which the firm expects to achieve its distribution objectives for its target market(s) Also known as “ Channel Strategy ” 12-12-2011 Ribhu Vashishtha-Channel Management 3

4. What is channel design? Those decisions involving the development of new marketing channels where none had existed before, or the modification of existing channels. 12-12-2011 Ribhu Vashishtha-Channel Management 4

5. Role of Intermediaries in a Value Network! Intermediaries provide greater efficiency in making goods available to target markets. Intermediaries provide Contacts Experience Specialization Scale of operation Match supply and demand. 12-12-2011 Ribhu Vashishtha-Channel Management 5

6. Information-Gathering and distributing market research and intelligence. Promotion-Developing and spreading communications about offers. Contact-Finding and communicating with prospective buyers. Matching-Adjusting the offer to fit a buyer's needs, including grading, assembling and packaging. Negotiation-Reaching agreement on price and other terms of the offer. Physical distribution-Transporting and storing goods. Financing-Acquiring and using funds to cover the costs of the distribution channel. Risk taking-Assuming some commercial risks by operating the channel (e.g. holding stock ). Channel Functions Information Promotion Contact Matching Negotiation Physical Distribution Financing Risk taking 12-12-2011 Ribhu Vashishtha -Channel Management 6

7. Channel Levels 12-12-2011 Ribhu Vashishtha-Channel Management 7

8. Types of Marketing Channels (Based on number of intermediaries) 12-12-2011 Ribhu Vashishtha-Channel Management 8

9. 0-level 12-12-2011 Ribhu Vashishtha-Channel Management 9 Manufacturer Consumer

10. 1-level 12-12-2011 Ribhu Vashishtha-Channel Management 10 Manufacturer Consumer Retailer

11. 2-level 12-12-2011 Ribhu Vashishtha-Channel Management 11 Manufacturer Retailer Wholesaler Consumer

12. Channel Integration 12-12-2011 Ribhu Vashishtha-Channel Management 12

13. Vertical Marketing System Vertical marketing systems (VMSs) provide channel leadership and consist of producers, wholesalers, and retailers acting as a unified system. 12-12-2011 Ribhu Vashishtha-Channel Management 13 Consumer

14. Horizontal Marketing System Horizontal marketing systems are when two or more companies at one level join together to follow a new marketing opportunity. Companies combine financial, production, or marketing resources to accomplish more than any one company could alone. 12-12-2011 Ribhu Vashishtha-Channel Management 14

15. Hybrid Marketing System Multichannel Distribution systems (Hybrid marketing channels) are when a single firm sets up two or more marketing channels to reach one or more customer segments . 12-12-2011 Ribhu Vashishtha-Channel Management 15

16. Channel Design Decisions 12-12-2011 Ribhu Vashishtha-Channel Management 16

17. Channel Conflict Channel conflict occurs when one channel member’s actions prevent another channel from achieving its goal. 12-12-2011 Ribhu Vashishtha-Channel Management 17

18. Causes of Channel Conflict Goal Incompatibility Unclear roles and rights Differences in perception Intermediary’s dependence on the manufacturer 12-12-2011 Ribhu Vashishtha-Channel Management 18

19. Channel Management Decisions 12-12-2011 Ribhu Vashishtha-Channel Management 19

20. Pepsi Channel Management 12-12-2011 Ribhu Vashishtha-Channel Management 20

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