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MANAGING MARKETING CHANNELS AND SUPPLY CHAINS

C HAPTER. MANAGING MARKETING CHANNELS AND SUPPLY CHAINS. What is a Marketing Channel?. A set of interdependent organizations that ease the transfer of ownership as products move from producer to business user or consumer. Retailer. A channel intermediary that sells mainly to customers.

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MANAGING MARKETING CHANNELS AND SUPPLY CHAINS

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  1. CHAPTER MANAGING MARKETING CHANNELS AND SUPPLY CHAINS

  2. What is a Marketing Channel? A set of interdependent organizations that ease the transfer of ownership as products move from producer to business user or consumer.

  3. Retailer A channel intermediary that sells mainly to customers. Wholesaler An institution that buys goods from manufacturers, takes title to goods, stores them, and resells and ships them. Agents and Brokers Wholesaling intermediaries who facilitate the sale of a product by representing channel member. Names for Marketing Intermediaries

  4. Specialization and Division of Labor Three Main Functions Overcoming Discrepancies Providing Contact Efficiency JOB OF INTERMEMDIARIES

  5. Provides efficiency and cost savings Attains economies of scale Aids producers who lack resources to market directly Builds good relationships with customers SPECIALIZATION AND DIVISION OF LABOR

  6. Discrepancy of Quantity The difference between the amount of product produced and the amount an end user wants to buy. Discrepancy of Assortment The lack of all the items a customer needs to receive full satisfaction from a product or products. OVERCOMING DISCREPANCIES

  7. Temporal Discrepancy A situation that occurs when a product is produced but a customer is not ready to buy it. Spatial Discrepancy The difference between the location of a producer and the location of widely scattered markets. OVERCOMING DISCREPANCIES

  8. Contact Efficiency

  9. Retailers Merchant Wholesalers Agents and Brokers CHANNEL INTERMEMDIARIES Take Title to Goods Take Title to Goods Do NOT Take Title to Goods

  10. CHANNELS FOR CONSUMER PRODUCTS DIRECT RESELLER WHOLESALER AGENT Producer Producer Producer Producer

  11. Factors Affecting Channel Choice Level ofDistributionIntensity Market Factors Intensive Distribution Product Factors Selective Distribution Producer Factors Exclusive Distribution What makes you choose a particular channel?

  12. Customer Profiles Consumer or Industrial Customer Size of Market MARKET FACTORS Market FactorsThat Affect ChannelChoices Geographic Location

  13. Product Complexity Product Price Product Life Cycle Product Delicacy PRODUCT FACTORS Product FactorsThat Affect ChannelChoices

  14. PRODUCER FACTORS Producer FactorsThat Affect ChannelChoices Producer Resources Number of Product Lines Desire for Channel Control

  15. Intensity Level Objective Number of Intermediaries Intensive Achieve mass marketselling. Convenience goods. Many Work with selected intermediaries. Shopping and some specialty goods. Several Selective Exclusive Work with singleintermediary. Specialty goods and industrial equipment. One LEVELS OF DISTRIBUTION INTENSITY

  16. LEVELS OF DISTRIBUTION INTENSITY

  17. Cost Criteria for Transportation Mode Choice Transit Time Reliability Capability Accessibility Traceability TRANSPORTATION FACTORS

  18. Advantages and disadvantages of five modes of transportation

  19. VERTICAL INTEGRATION The degree to which a firm owns the stages of its supply chain management from materials supply- to manufacture -to distribution- to sale. Backward an Forward Integration – buy the step before or after you in the chain

  20. HORIZONTAL INTEGRATION When a company takes over another in the same business, thus eliminating a competitor and achieving a bigger market share For example - Whole Foods buys Wild Oats to gain a bigger share of the health food market Problem is monopoly creation, so govts watch these sales closely Mitsubishi Dealership Mazda Dealership Nissan Dealership Toyota Dealership Honda Dealership

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