Marketing Indicator 3.05. Acquire foundational knowledge of channel management to understand its role in marketing. How do channel members add value?. The use of intermediaries results from their greater efficiency in making goods available to target markets.
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How do channel members add value?
The use of intermediaries results from their greater efficiency in making goods available to target markets.
Offers the firm more than it can achieve on its own through the intermediaries contacts, experience, specialization, and scale of operation.
Channel intermediaries offer contacts, experience, specialization, and economies of scale to organizations that cannot offer these attributes on their own.
Marketing channels allows producers to realize the benefits that only larger organizations may be able to support.
Channel intermediaries offer value in the form of Information, Promotion, Negotiation, Funding, Risk taking, Physical possession, Payment options, and Title
Selecting Channel Members
• Type of goods being sold( e.g. clothes, grocery, furniture)• Type of service (e.g. self-service, counter-service)• Size (e.g. corner shop; superstore)• Ownership (e.g. privately-owned independent; public-quoted retail group)• Location (e.g. rural, city-centre, out-of-town)• Brand (e.g. nationwide retail brands; local one-shop name)
A multichannel distribution system
consumer goods and services
Channels for industrial goods and services
Illegal Channel Management Activities
Actions to Facilitate Order Processing
No, Customer Notified of Backorder
Yes, Item Packed for Shipment
Accounts Receivable Processes Payment
Business Identify Distribution on Demand Standing with Three Key Processes
Distribution on Demand
Barriers to use of Technology in Channel Management
Barriers to use of Technology in Channel Management (continued)
Ways to serve markets with low profit potential
Show own interests are aligned with community interest in employment and commerce
Enlist community support for security, collection, and system monitoring
Improve alignment between the business and community
Partner with the communities, as communities are frequently in a better position to resolve issues that make it uneconomic to serve low profit areas
Build awareness of benefits the company can bring