Intro Mktg - 09 - Distribution - ch 12 & 13

Intro Mktg - 09 - Distribution - ch 12 & 13 - MKTG...

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1 DISTRIBUTION CHANNELS MKTG 2270 MARCH 13, 2007
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2 The Marketing Channel consists of a set of interdependent entities (a producer, a buyer, and any intermediary organizations) involved in the process of making a product or service available for use or consumption by the consumer Marketing Channel (Distribution Channel)
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3 How Channel Members Add Value Fewer contacts. Match product assortment demand with supply. Bridge time (temporal) and place (spatial) gaps that separate products from users.
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4 Toshiba Sony Panasonic Samsung LG Customer 1 Customer 2 Customer 3 Customer 4 Customer 5
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5 Toshiba Customer 1 Future Shop Customer 2 Customer 3 Customer 4 Customer 5 Sony Panasonic Samsung LG
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6 Number of Channel Levels The number of intermediary levels indicates the length of a marketing channel. Direct Channels Indirect Channels
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7 Direct versus indirect channels Direct : Producer Consumer Indirect : Producer Retailer Consumer Producer Wholesaler Retailer Consumer Producers lose more control and face greater channel complexity as additional channel levels are added.
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8 Channel Conflict - Occurs when channel members disagree on roles, activities, or rewards. Vertical conflict: occurs among firms at different channel levels Horizontal conflict: occurs among firms at the same channel level
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9 Channel Organization Conventional Distribution Channels Consist of one or more independent channel members Each seeking to maximize its own profits Often result in poor performance
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10 Channel Organization Vertical Marketing Systems Producers, wholesalers, and retailers act as a unified system One channel member owns, has contracts with, or
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Intro Mktg - 09 - Distribution - ch 12 & 13 - MKTG...

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