mktgfinalguide - MARKETING FINAL STUDY GUIDE Chapter 15...

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MARKETING FINAL STUDY GUIDE Chapter 15: Marketing Channels 1. Functions performed by intermediaries Transactional: a) Buying (purchase products for resale or supply) b) Selling (seek orders, contact customers, promote) c) Risk Taking (assume biz risks, inventory you might get stuck with) Logistical: a) Assorting ( create assortments form several sources to serve customers ) b) Storing (assemble and protect, better customer service) c) Sorting (large quantities break down to smaller desired by customers) d) Transporting (physical moving) Facilitating: a) Financing (extend credit) b) Grading (inspect and judge) c) Marketing info and research (info on competitive conditions and trends) 2. Utilities Offered by Retailers: Place, Time, Form, Possession 3. Intermediary Types Middlemen-any intermediary between manufacturer and end user Agent/broker-any intermediary with legal authority behind manufacturer Wholesaler-any intermediary that sells to others (usually retailers) Retailer-any intermediary who sells to customers Distributor-variety of distro functions like sell, extend credit Dealer-imprecise and can be any 4. Channel Structure (380-384) Direct=producer deals straight to ultimate consumer Indirect=one or multiple intermediaries *Scale from Direct Prod ---> Least Direct (retailer, wholesaler, agent, consumer) a) Consumer Products: Schwan Food, Toyota, Mars Candy, Mansar -Toyota includes retailer, sell in large quantities w/o expensive wholesaler -Mars adds retailer and wholesaler, for low cost low unit and frequent purchases -Mansar adds all, jewelry to hella wholesalers and onto retailers b) Business Products: IBM, Caterpillar (stock parts), electronic similar to both -IBM is direct, buyers large and well defined Why use wholesaler or agents? -value created for both sellers and consumers Biz/indus vs. consumer channels-shorter, less intermeds, fewer/bigger customers Multichannel-mix direct, indirect, and online, ex. Wal-Mart Dual Distribution-GE sells large appliances directly to homes and uses Lowe’s
MARKETING FINAL STUDY GUIDE Strategic Channel Alliances-recent innovation, General Mills and Nestlé 5. Vertical Marketing Systems -Traditional have loosely knit network of independent producers & intermediaries -These improve efficiency and greater marketing effectiveness 1) Corporate -successive stages of prod/dist under 1 ownership, ex. Ralph Lauren *RL is example of forward integration , backward is retailer owns prod. (Kroger) 2) Contractual -most popular where prod/dist join efforts on contract basis, includes wholesaler/retailer/franchise sponsors (manufacturer & related) 3) Administered -coordination and influence, not ownership or contract based, ex. P/G given broad products of diapers to detergents coop. for displays/promos Channel captain influences others, can be economic/id/expertise/contractual

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