Marketing Management
 |
Details
Textbook:
Pages : 500;
Paperback;
210 X 275 mm approx.
Workbook:
Pages :
282; Paperback;
210 X 275 mm approx, Sample Applied Theory Questions
Pricing
Textbook Price: Rs. 900;
Workbook Price: Rs. 700;
Available only in INDIA
Buy Now
Please allow 5 to 10 days for delivery.
Detail Table of Contents
Channels of Marketing : Chapter 16
SUMMARY: A marketing channel can be understood as an organized network of agencies and institutions, which perform activities required to link producers with users to accomplish the marketing task. Marketing channels are of a dynamic nature as managers constantly seek to improve or make them better and thereby leverage them as a competitive advantage. Marketing channels perform various roles which range from filling the gaps that occur between the production and consumption process, reduction in time and expenditure of the manufacturer in reaching the customers, aggregating the narrow product ranges of individual producers to provide the wide product assortment that customers require, appraising manufacturers from time to time of the requirements of customers and promoting the products of manufacturers through efficient product displays and other promotional techniques. |
|
Depending on the number of intermediaries required at each level, the three major choices of distribution available to producers are: intensive distribution, exclusive distribution and selective distribution. Besides distribution of products, channel members also participate in the distribution of services.
Marketing channels perform the function of facilitating the exchange process, alleviating discrepancies, standardizing transactions, matching buyers and sellers, and providing customer service.
Designing of the distribution channels deals with those decisions that are associated with forming a new distribution channel or modifying an existing one. While designing a channel, marketers need to take into consideration the utility that the channel needs to serve. The four types of utility that marketing channels can serve include lot size utility, convenience utility, selection utility and service utility. A firm's selection of a specific channel for distribution of its products or services depends on three criteria – economic, control and adaptive. Management of marketing channels involves several issues such as channel member selection, their training, motivation and evaluation, modifying channel arrangement, and legal and ethical issues like dual distribution, exclusive dealing agreement, refusal to deal, restricted sales territories and dealer's rights.
Channel dynamics involves the study of the impact of environmental forces such as economic, legal, political, social, technological and competitive forces on marketing channels. In order to reduce costs, achieve economies of scale, stabilize supplies, achieve coordination among themselves and overcome conflicts, the various channel members need to integrate their functions under the directions of a channel leader, either horizontally or vertically. This gives rise to the horizontal marketing system and vertical marketing systems. A horizontal marketing system is the process of sharing resources amongst two or more unrelated businesses at the same level of operations to attain common benefits. The vertical marketing system (VMS) is a process in which producers, wholesalers and retailers perform the marketing activities jointly. The various types of vertical marketing systems are corporate, administered and contractual vertical marketing system. Contractual vertical marketing systems are again of three types - retailer-sponsored cooperative organizations, wholesaler sponsored voluntary organizations and franchise organizations.
Multichannel marketing is where a single firm uses two or more marketing channels to reach one or more market segments. This process is also known as 'dual distribution.' Although additional channels increase the market coverage of the firm, they also result in greater conflict between the channel members, especially if the members are vying for the same market segments.
Conflicts arise between marketing channel members when one member of the marketing channel thinks that another member is preventing or impeding it from achieving its marketing goals. Channel conflicts can be of three types – vertical, horizontal, and multichannel conflicts.
Conflicts may arise due to various reasons such as a difference in the aim of producer and channel members, lack of clearly defined roles and responsibilities and both manufacturer and channel members fighting for the same market.
The various methods for solving and managing conflicts include negotiation, problem-solving strategies, persuasive mechanisms, legalistic strategies, and climate management. Obtaining the cooperation and coordination of the channel members helps firms leverage their limited resources to achieve organizational objectives through the combined efforts of the channel members.
