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a.Communication: Regular communication between the company, distributors and dealers will certainly go a long way in minimising channel conflicts. Circulars, e-mails, news letters, personal one-to-one discussions can be used to communicate with channel members. Taking feedback from key distributors/dealers and involving them in discussions will help the company in improving relations with distribution channel members. b.Aligning goals of the company with these of channel members:The sales and field activities plan of the company should be discussed and communicated to the distributors/dealers so that 288
MANAGING DISTRIBUTION CHANNELS AND PHYSICAL DISTRIBUTIONboth the company and channel members can work together for achievement of common objectives. c.Dealer councils can resolve conflicts between company/ distributors/dealers. It provides an opportunity for dealers to represent the problem in the market. d.Arbitration and mediationfacilitate settlement of channel conflicts. If these methods prove ineffective, the member may go to the court. However, it is a time-consuming and very often an expensive option. 7.2 DIRECT MARKETING Under general marketing, marketer depends upon advertising, sales promotion, and personal selling to promote their products and use some channel of distribution to bring about mass distribution. Advertising is used for awareness, interest and to build the brand image. Sales promotion is required for impulse buying or offering USP to buy now. Personal selling is employed to convince the prospect and close the sale. Under direct marketing all the three means of promotion are compressed to induce direct sale without the help of any middleman traders. Direct marketing is selling product and services to customers without the use of channel members. A direct marketer is an organisation that uses personal selling, advertising, sales promotion, electronic media, vending machines, etc. to promote and sell products directly to consumers/users. Telemarketing i.e., marketing by telephone has assumed greater importance than even mail-order sale in all developed countries; very soon televised shopping also will grow in importance. •Major Direct Marketing (Non-store Retailing) Methods 1.In-home Selling:Marketer can use door-to-door selling through trained sales force. In India Eureka Forbes is marketing its consumer durables, vacuum cleaners and electronic water filters through in-home or direct selling. Initial contact may be made by phone or mailed-in-coupon. This method is costly but effective. We may have a party plan approach. A host invites friends to a party, a salesman makes a sales presentation at the party. The invitees can shop in a friendly and social 289
MANAGING DISTRIBUTION CHANNELS AND PHYSICAL DISTRIBUTIONenvironment. In India, manufacturer of Nutrela (Soyabean product) decided to go to the consumers directly, and teach them how to use the product. Demonstrators were housewives who would approach a ladies’ Kitty group, a mahila mandal. They would make a few dishes with Nutrela granules. While cooking, they would comment on the goodness