Marketing Channels & Distribution. The Importance of Marketing Channels. Intermediaries make distribution and selling processes more efficient. Intermediaries offers supply chain partners more than they could achieve on their own. Market Exposure Technical Knowledge/Information Sharing
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Goodyear’s conflicts with its independent dealers have decimated the firm’s replacement tire sales.
Branded goods using the Wolfgang Puck, T.G. I. Friday’s, Taco Bell, Emeril’s, and Starbuck’s names are now being sold in grocery stores.
Look at the items at right. Which stands the greatest risk of causing channel conflict? Why?Channel Conflict Example
Copyright 2007, Prentice-Hall Inc.
Occurs when producers sidestep intermediaries and sell directly to final buyers, or when radically new types of channel intermediaries displace traditional ones.
The Internet has made the disintermediation of many traditional retailers possible.
Calyx & Corolla sells fresh flowers and plants direct to consumers over the phone and via the Web, drastically reducing the time it takes flowers to reach consumers via conventional retail channels.
Black & Decker chose to avoid disintermediation by not using the Internet to sell their products. Instead B&D directs consumers to stores that carry its products.
Primarily a question of size and life cycle stage.
Does the company always get to choose?
Maytag uses selective distribution like many furniture and appliance manufacturers.
The “Where to Buy” page on their Web site assists buyers in finding stores that carry the Maytag brand.
If Xerox required every business who bought or leased their copiers to also buy their brand of paper, it would be a tying agreement.
RFID technology promises to automate the entire distribution chain, resulting in significant cost savings.
Retailers may soon mandate supplier use of RFID.
Intermodal transportation combines two or more modes of transportation. Fishyback = water and trucks; Piggyback = trucks and rail; Trainship = water and rail; Airship = air and water.
Most small and medium size companies outsource transportation to UPS or other logistics providers.