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29 Pages

MKT337 - 04855 - Class 13 - Chap 13 - 022812 - Marketing Channels

Course: MKT 337, Spring 2012
School: University of Texas
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Word Count: 974

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13 Marketing Chapter Channels MKT 337 Section 04855 Class #13 February 28, 2012 Designed and manufactured by Tata Motors Up to 60MPG 75MPH top speed 16 longer than Smart ForTwo; will accommodate 5 adults Options: air conditioning, electric windows, radio, aluminum wheels 3-year warranty Base price: about $2,000 USD Bill Peterson, 2012 Slide 2 The Marketing Process: Initiating the Process...

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13 Marketing Chapter Channels MKT 337 Section 04855 Class #13 February 28, 2012 Designed and manufactured by Tata Motors Up to 60MPG 75MPH top speed 16 longer than Smart ForTwo; will accommodate 5 adults Options: air conditioning, electric windows, radio, aluminum wheels 3-year warranty Base price: about $2,000 USD Bill Peterson, 2012 Slide 2 The Marketing Process: Initiating the Process Strategic Planning 2 Marketing Environment Buyer Behavior 4 Segmentation - Targeting - Positioning 6 7 8 Creating Value Product 10 11 12 Place 13 14 15 Promotion 16 17 18 Price 19 20 Capturing Value Customer Relationship Management 1 3 5 Overview Ethics Global Bill Peterson, 2012 21 9 22 Research Digital Marketing Slide 3 For Next Class (3/01/12): Read Chapter 14 in MKTG5 Read Diaper vs. Goliath, Business Week 10/11/10 (posted on Blackboard) Questions for consideration: What targeting strategy is Diapers.com using? Compared to Amazon.coms targeting strategy, what are the advantages and disadvantages? When compared to Amazon.com, what is the primary source of value that Diapers.com provides to customers? In what way has Diapers.com created a competitive advantage using its supply chain? Bill Peterson, 2012 Slide 4 Todays BIG Ideas: The functions of a marketing channel The role of intermediaries and how they factor in to channel design Considerations in managing a channel: disintermediation and channel conflict Bill Peterson, 2012 Slide 5 Perceived = Value = Bill Peterson, 2012 ( ( (What you get) (What you pay) ) ) (Product) (Place) (Promotion) (Price) Slide 6 Definition of a Marketing Channel: A business structure of interdependent organizations that reach from the point of product origin to the consumer with the purpose of moving products to their final consumption destination. - or The pipeline through which communication, products, payments, and customer service flow between the producer the customer. Bill Peterson, 2012 Slide 7 Direct Channel: Producer Online Direct Mail Telemarketing Catalog Direct Selling Email Customer Shop-at Home TV Social Media Bill Peterson, 2012 Slide 8 Intermediaries: Producer Intermediaries Customer Bill Peterson, 2012 Slide 9 The Value Created by Intermediaries: Producer 1. Provide Contact Efficiencies: Hilton Hilton Carolyn Hyatt Elizabeth Hyatt Elizabeth Loews Intermediaries Carolyn Greta Loews Greta Marriott Kevin Marriott Kevin Travelocity Omni Lynne Todd Radisson Todd Sheraton Tom Sheraton Tom Westin Bill Peterson, 2012 Omni Radisson Customer Lynne Will Westin Will Contacts with no intermediaries 8 producers x 8 buyers = 64 contacts Contacts with one intermediaries 8 producers + 8 buyers = 16 contacts Slide 10 The Value Created by Intermediaries: Producer 2. Perform Important Channel Functions: Transactional Contacting and promoting Negotiating Risk taking Intermediaries Logistical Facilitating Customer Bill Peterson, 2012 Physically distributing Storing Sorting Researching Financing Slide 11 The Value Created by Intermediaries: Producer 3. Provide Value for Customers: Intermediaries $1099.99 $909.95 Provide information to assist with selection and usage of product Customer Provide product when and where demanded Provide complementary products and services Provide after-sale support Bill Peterson, 2012 Slide 12 The Value Created by Intermediaries: Ikon Office Solutions: 500,000 Customers Bill Peterson, 2012 Slide 13 Marketing Channels for Consumer Products: Direct Channel Producer Consumer Bill Peterson, 2012 Slide 14 Marketing Channels for Consumer Products: Direct Channel Retailer Channel Producer Producer Retailer An intermediary who sells to the final end customer (consumers) To be discussed in detail in Chapter 15 Consumer Bill Peterson, 2012 Consumer Slide 15 Marketing Channels for Consumer Products: Direct Channel Retailer Channel Wholesaler Channel Producer Producer Producer Wholesaler Retailer Consumer Bill Peterson, 2012 Retailer Consumer intermediary who An sells to other intermediaries (usually retailers) Independently owned firms that take title to the merchandise they handle Consumer Slide 16 Marketing Channels for Consumer Products: Direct Channel Retailer Channel Wholesaler Channel Agent/Broker Channel Producer Producer Producer Producer Agent or Broker Wholesaler Wholesaler Intermediaries with legal authority to act on behalf of the producer Do not take title to merchandise Typically perform limited functions Retailer Consumer Bill Peterson, 2012 Retailer Retailer Consumer Consumer Consumer Slide 17 Marketing Channels for Business and Industrial Products: Direct Channel Industrial Distributor Producer Producer Agent/Broker Agent/BrokerChannel Industrial Dist. Producer Producer Agent or Broker Agent or Broker Industrial Distributor Industrial Customer Bill Peterson, 2012 Industrial Customer Industrial Distributor Industrial Customer Industrial Customer Slide 18 The Cost of Intermediaries: Producer $10.00 $7.14 $6.64 $6.49 $6.04 Agent or Broker Agent or Broker 5-10% 5-10% $6.49 Wholesaler 5-15% $7.14 Retailer 30-50% $10.00 $10.00 Retailer 30-50% $10.00 Wholesaler 5-15% $7.14 $7.14 Retailer 30-50% $10.00 Retailer 30-50% $10.00 Consumer Bill Peterson, 2012 Slide 19 No customer channel preference for intermediary Market is geographically concentrated Small number of customers Complex, custom and/or expensive products Producer Factors Product Factors Market Factors Factors Affecting Channel Choice: Perishable or fragile products Producer has strong marketing resources Bill Peterson, 2012 Producer has strong need for control and customer visibility Direct (Short Channel) Customer has channel preference for intermediary Market is geographically dispersed Large number of customers Simple, standardized, inexpensive products Non-perishable or non-fragile products Producer does not have strong marketing resources Producer does not have strong need for control and customer visibility Multiple Intermediaries (Long Channel) Slide 20 Channel Designs: Agent or Broker Wholesaler Retailer Retailer Wholesaler Retailer Customer Bill Peterson, 2012 Slide 21 Channel Design: Movie Distribution CONCEPTUAL Movie Distributor Wholesaler Premium Cable Network Theaters Retailers Cable/Satellite Providers Purchase/ Rental/ Stream Pay-perview Premium channels Television Network Broadcast Customer Bill Peterson, 2012 Slide 22 Level of Distribution Intensity: Type of Distribution Pro/Con Intensive Distribution: product is available in every outlet where potential customers might want to buy it. + Maximum market coverage - Minimum control - Little incentive for outlet to invest in demand creation Selective Distribution: product is available in select outlets that meet certain criteria. + Good balance between intensive and exclusive Exclusive Distribution: only a limited number of dealers are given the exclusive right to distribute the product. Example + Motivates investment in promotion, maintaining inventory and other investments + Allows for good control - Suboptimal when broad market coverage is required Bill Peterson, 2012 Slide 23 Level of Distribution Intensity: Exclusive distribution example: Bill Peterson, 2012 Slide 24 January 3, 2011 Bill Peterson, 2012 Slide 25 Other Examples of Disintermediation: Bill Peterson, 2012 Slide 26 Value Chain Example: CONCEPTUAL 9 29.9 $ $9 $6 $11 $15 $2 $2 $16.40 $13.60 $9 $6 $5 $15 $2 $2 $4 $4 $5 $2 $1.60 $11 $0.40 $2 $1.60 Manufacturer (e.g Bill Peterson,Changzhou) 2012 Producer (e.g. Garmin) Wholesaler (e.g. Ingram) Retailer (e.g. Best Buy) Value Added $0.40 Profit Slide 27 Channel Design: Coach Merchant Wholesaler Coach Stores Macys Catalogs & Coach.com Coach Outlet Bloomingdales Customer Bill Peterson, 2012 Slide 28 Tactics to Manage Channel Conflict: Limit distribution Offer exclusive products to each channel or channel category Minimum Advertised Price (MAP) Bill Peterson, 2012 Slide 29
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University of Texas - MKT - 337
Chapter 14Supply Chain ManagementMKT 337 Section 04855Class #14 March 01, 2012 Bill Peterson, 2012Slide 2Herrs Supply Chain:PotatoSupplierVegetableOil SupplierSaltSupplierSeasoningsSupplierPackagingSupplierHerrsWholesalerSupermarketsCo
University of Texas - MKT - 337
Chapter 15RetailingMKT 337 Section 04855Class #15 March 06, 2012Growth and Fragmentation in Retail:Consumer wealthMore productsLess expensive productsMore competitionDiverse demographicsGlobalization Bill Peterson, 2012US Retail Today: $4.5 t
University of Texas - MKT - 337
Chapter 16Integrated Marketing CommunicationsMKT 337 Section 04855Class #17 March 20, 2012HeinzBrand$2.89 Bill Peterson, 2012SafewayBrand$1.00Slide 2Promotion Strategy: Bill Peterson, 2012Slide 3Factors Driving the Shift Away from Mass Comm
University of Texas - MKT - 337
Chapter 17Advertising and Public RelationsMKT 337 Section 04855Class #18 March 22, 2012The Marketing Process:Initiating theProcessStrategicPlanning2MarketingEnvironmentBuyer Behavior4Segmentation - Targeting - Positioning678CreatingValu
University of Texas - MKT - 337
Chapter 18Sales Promotion and Personal SellingMKT 337 Section 04855Class #19 March 27, 2012The Marketing Process:Initiating theProcessStrategicPlanning2MarketingEnvironmentBuyer Behavior4Segmentation - Targeting - Positioning678Creating
University of Texas - MKT - 337
Chapter 18Sales Promotion and Personal SellingMKT 337 Section 04855Class #19 March 27, 2012The Marketing Process:Initiating theProcessStrategicPlanning2MarketingEnvironmentBuyer Behavior4Segmentation - Targeting - Positioning678Creating
University of Texas - MKT - 337
Chapters 19 and 20PricingMKT 337 Section 04855Class #20 and 21 March 29 and April 3, 2012Pricing for Laser Eye Surgery: Bill Peterson, 2012Slide 2The Marketing Process:Initiating theProcessStrategicPlanning2MarketingEnvironmentBuyer Behavio
University of Texas - MKT - 337
Chapter 9Market ResearchMKT 337 Section 04855Class #23 and 24 April 10 and 12, 2012Slide 2 Bill Peterson, 2012Slide 33D Theaters in Katy, Texas:? Bill Peterson, 2012Slide 4Three Approaches to Decision Making in Business:1. GuessDo anything2.
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MKT 337 Exam 3 Study Outline 04/05/12Chapter 16: Integrated Marketing Communications How to select promotional mediums (advertising, PR, sales promotion, etc.) and construct apromotional mix for a given marketing opportunity (promotional goals, stage o
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