Designing marketing channels

Marketing Management

1. DESIGNING AND
MANAGING
INTEGRATED
MARKETING
CHANNELS

2. WHAT IS A MARKETING
CHANNEL?

3. Marketing Channel
The particular set of interdependent
organizations involved in the
process of making a product or
service available for use or
consumption.

4. CHANNELS AND
MARKETING DECISIONS

5. Push strategy
uses the manufacturer’s sales force, trade promotion
money, and other means to induce intermediaries to
carry, promote, and sell the product to end users.
uses advertising, promotion, and other forms of
communication to persuade consumers to demand
the product from intermediaries.
Pull strategy

6. Push & pull strategy

7. UNDERSTANDING
CUSTOMER NEEDS

8. Categories of Buyers
Habitual shoppers
High value deal seekers
Variety-loving shoppers
High involvement shoppers

9. Types of shoppers
Service/quality customers
Price/value customers
Affinity customers

10. ROLE OF MARKETING
CHANNELS

11. Channel Member Functions
Gather information

12. Channel Member Functions
Gather information
Develop and disseminate persuasive communications

13. Channel Member Functions
Gather information
Develop and disseminate persuasive communications
Reach agreements on price and terms

14. Channel Member Functions
Gather information
Develop and disseminate persuasive communications
Reach agreements on price and terms
Acquire funds to finance inventories

15. Channel Member Functions
Gather information
Develop and disseminate persuasive communications
Reach agreements on price and terms
Acquire funds to finance inventories
Assume risks

16. Channel Member Functions
Gather information
Develop and disseminate persuasive communications
Reach agreements on price and terms
Acquire funds to finance inventories
Assume risks
Provide for storage

17. Channel Member Functions
Gather information
Develop and disseminate persuasive communications
Reach agreements on price and terms
Acquire funds to finance inventories
Assume risks
Provide for storage

18. Channel Member Functions
Provide for buyers’ payment of their bills

19. Channel Member Functions
Provide for buyers’ payment of their bills
Oversee actual transfer of ownership

20. Marketing Channel Flows Example

21. Consumer Marketing Channels

22. Industrial Marketing Channels

23. CHANNEL DESIGN
DECISIONS

24. Designing a
Marketing Channel System
Analyze customer needs
Evaluate major channel alternatives
Identify major channel alternatives
Establish channel objectives

25. Designing a
Marketing Channel System
Analyze customer needs

26. Designing a
Marketing Channel System
Analyze customer needs
Lot size

27. Designing a
Marketing Channel System
Analyze customer needs
Lot size
Waiting/
delivery
time

28. Designing a
Marketing Channel System
Analyze customer needs
Lot size
Waiting/
delivery
time
Spatial
convenience

29. Designing a
Marketing Channel System
Analyze customer needs
Lot size
Waiting/
delivery
time
Spatial
convenience
Product
variety

30. Designing a
Marketing Channel System
Analyze customer needs
Lot size
Waiting/
delivery
time
Spatial
convenience
Product
variety
Service
back up

31. Designing a
Marketing Channel System
Identify major channel alternatives
Types of
intermediaries

32. Designing a
Marketing Channel System
Identify major channel alternatives
Types of
intermediaries
Number of
intermediaries

33. Designing a
Marketing Channel System
Identify major channel alternatives
Types of
intermediaries
Number of
intermediaries
Terms and
responsibilities

34. Designing a
Marketing Channel System
Number of
intermediaries

35. Designing a
Marketing Channel System
Number of
intermediaries
Exclusive

36. Designing a
Marketing Channel System
Number of
intermediaries
Exclusive
Selective

37. Designing a
Marketing Channel System
Number of
intermediaries
Exclusive
Selective
Intensive

38. Designing a
Marketing Channel System
Identify major channel alternatives
Types of
intermediaries
Number of
intermediaries
Terms and
responsibilities

39. Designing a
Marketing Channel System
Terms and
responsibilities

40. Designing a
Marketing Channel System
Terms and
responsibilities
Price policy
Conditions of sale
Distributor’s territorial rights
Mutual services and responsibilities

41. The Value-Adds vs. Costs of Different
Channels

42. CHANNEL MANAGEMENT
DECISIONS

43. Channel-Management
Decisions
Selecting channel members
Training channel members
Motivating channel members
Evaluating channel members
Modifying channel members

44. CHANNEL INTEGRATION
AND SYSTEMS

45. Channel Integration & Systems
Vertical marketing
systems
Horizontal
marketing systems
Multichannel
systems

46. Channel Integration & Systems
Vertical marketing
systems
Horizontal
marketing systems
Multichannel
systems
•Corporate VMS
•Administered VMS
•Contractual VMS

47. ■Channel conflict occurs when one
member’s actions prevent another
channel from achieving its goal.
■Types of channel conflict
–Vertical
–Horizontal
–Multichannel

48. Causes of channel conflict
Goal incompatibility
Unclear roles and rights
Differences in perception
Intermediaries’ dependence on the manufacturer

49. Strategies for Managing Channel Conflict
■Adoption of
superordinate goals
■Exchange of
employees
■Joint membership
in trade
associations
■Cooptation
■Diplomacy
■Mediation
■Arbitration
■Legal recourse

50. E-COMMERCE
MARKETING
PRACTICES

51. Pure-Click Companies
those that have launched a
Web site without any
previous existence as a
firm

52. Brick-and-Click
Companies
existing companies that
have added an online site
for information and/or
e-commerce

53. THANK YOU FOR
LISTENING!