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Marketing Channels . Chapter 13 . Determine 2-3 different ways of transportation for the following. 24 air compressors, each of 36’’x36’’x60’’, 400 p. each to Dallas, TX. Two crates of rare orchids, 12’’x24’’x48’’, each weighing 27 pounds to NYC

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determine 2 3 different ways of transportation for the following
Determine 2-3 different ways of transportation for the following
  • 24 air compressors, each of 36’’x36’’x60’’, 400 p. each to Dallas, TX.
  • Two crates of rare orchids, 12’’x24’’x48’’, each weighing 27 pounds to NYC
  • 6 classic cars purchased by an eccentric, wealthy customer in UK. The cars are not currently running.
vocabulary
Vocabulary
  • Marketing (Supply/Distribution)Channel: group of individuals and organizations that directs the flow of products from producers to customers.
  • Supply chain management: starts before physical distribution, covering procurement of inputs, conversion into finished products, and product movement to final destinations
slide4

Firm

Customer

Channel members

          • ? retail stores
          • wholesalers
          • telemarketing
          • mail order catalogs
          • web sites
  • "Push" : getting channels to ………your product
  • "Pull" : getting consumers to ……...your product by name
functions performed by intermediaries
Functions performed by intermediaries
  • Transactional (promote, negotiate, take risks )
  • Logistical
  • Facilitating (researching and financing)
logistical physical distribution gets it to customers

LogisticsorPhysicalDistribution

Logistical : Physical Distribution Gets It to Customers

Coordinating the flow of information among channel members

facilitating channel specialists adjust discrepancies with regrouping activities

Accumulating

Bulk-Breaking

Assorting

Facilitating : Channel Specialists Adjust Discrepancies with Regrouping Activities

………………

(Medical Clinics)

Allocating

or

Bulk-Breaking

QUANTITY

COSTCO

Heterogeneity

Sorting

(Grading Oranges)

……………..

ASSORTMENT

channel intermediaries

Retailers

Take Title to Goods

Merchant

Wholesalers

Take Title to Goods

Agents

and

Brokers

Do NOT Take Title to Goods

Channel Intermediaries
types of marketing channels channels for consumer products
Types of Marketing ChannelsChannels for Consumer Products

Direct Channel

TRADITIONAL

DUAL DISTRIBUTION & REVERSE CHANNELS

channel strategy decisions
CHANNEL STRATEGY DECISIONS

1.Selection of a Marketing Channel

2.Intensity of

Distribution

3.Management of

Relationships

1 selection of a marketing channel
1.Selection of a Marketing Channel
  • Market factors:
    • Consumer vs Business markets (large vs. small quant, service)
    • Geographic location (concentrated, dispersed)
  • Product factors:
    • Complex, customized, expensive
    • Products’ life cycle/delicacy (e.g. mature, perishable)
  • Producer factors:
    • Big/small
    • Image protection
red bull is sold at convenience stores supermarkets and warehouse clubs red bull has distribution
Red Bull is sold at convenience stores, supermarkets and warehouse clubs. Red Bull has _________ distribution
  • selective
  • exclusive
  • intermediate
  • intensive
  • limited
slide19

Retailer

Retailer

Retailer

Retailer

Distributor

Horizontal

slide20

Firm

Customer

Channels

  • "Captive Channels" : channels owned by firm
  • "Non-Captive Channels" : channels not owned by firm
  • "When do retailers have "channel power"?
  • firm's product is not well differentiated from competitors
  • threat of backward integration
slide21

Firm

Customer

Channels

Channel conflict examples

  • Firm: Your retail prices are too high, and are driving down demand
  • Retailer: With your wholesale prices, it’s the only way we can make money
  • Firm: You carry too many lines, our product isn't even noticed on shelves
  • Retailer: Customers come first. BTW, why don't you prune your line.
slide22

Firm

Customer

Retail store

Website

  • "free – riding" by internet channel
  • customers who use more than one channel get confused

• return policies

• origin of merchandise

• different prices