CHANNELS OF DISTRIBUTION IN MARKETING MANAGEMENT

CHANNELS OF DISTRIBUTION

1. Channels of Distribution A distribution channel is a chain of intermediaries through which goods or services pass from the producer to the ultimate consumer. Each intermediary plays a role in the distribution process, adding value and facilitating the movement of products. by Dhivya Srinivasan

2. Different types of distribution Channels Direct Channel Manufacturers sell directly to consumers. This bypasses intermediaries and provides greater control over the product. Indirect Channel Products go through intermediaries, such as wholesalers or retailers, to reach consumers. It allows for wider reach and economies of scale. Hybrid Channel Companies use a combination of direct and indirect channels to leverage the strengths of each approach.

3. Functions of Channels Physical Distribution Channels ensure products reach the customer, including transportation, warehousing, and inventory management. Financial Transactions Channels facilitate payment processes, including credit, financing, and collection. Information Flow Channels gather customer feedback, relay product information, and provide technical support. Relationship Building Channels create relationships with customers and build brand loyalty through interactions.

4. Channel Management Channel Management Definition Channel management is the process of planning, implementing and controlling the flow of goods and services from the producer to the end user. This includes choosing the right channels, managing relationships with channel partners, and ensuring that products are delivered efficiently and effectively. Key Objectives Maximise profitability Increase market share Improve customer satisfaction Enhance brand image Tools and Techniques Channel management involves various tools and techniques to optimise performance. These include: Channel audits Channel performance metrics Channel training programs Channel conflict resolution Challenges Channel management comes with its own set of challenges. These can include: Channel partner conflict Channel cost optimisation Maintaining channel consistency Adapting to market changes

5. Selection of Distribution Channels 1 Target Market Understanding the target market is crucial. Consider their demographics, preferences, and buying habits. 2 Product Type The nature of the product influences channel choice. Perishable goods may require direct distribution, while durable goods can use intermediaries. 3 Competitive Landscape Analyse competitors' distribution strategies. Consider their channels, reach, and effectiveness. 4 Cost and Efficiency Evaluate channel costs, including warehousing, transportation, and marketing. Choose channels that offer optimal efficiency.

6. Promotion – Meaning and Purpose Promotion is the process of communicating the value of a product or service to target customers. Its purpose is to generate awareness, build interest, create desire, and ultimately drive action, such as purchase, trial, or advocacy.

7. Role of Promotion in Marketing Informing Promotion helps to inform customers about products and services, their features, benefits, and pricing. Persuading Promotional activities aim to persuade customers to buy a specific product or service over alternatives. Building Relationships Promotion helps to create and maintain relationships with customers, strengthening brand loyalty and trust. Driving Sales Ultimately, promotion plays a crucial role in driving sales and achieving business objectives.

8. Promotion Methods Advertising This involves using paid media to reach a large audience. It can take many forms, including television, radio, print, and online advertising. Public Relations This focuses on building relationships with the media and other stakeholders to generate positive publicity. It can involve press releases, media interviews, and event sponsorship. Sales Promotion This involves offering incentives to encourage customers to buy. It can include discounts, coupons, free samples, and contests. Direct Marketing This involves communicating directly with customers to promote products and services. It can include mailings, email campaigns, and telemarketing.