In some industries advances in information technology such as the Internet have

In some industries advances in information technology

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In some industries, advances in information technology (such as the Internet) have enabled disintermediation (when number of intermediaries in a supply channel is reduced) or a reconfiguration in the types of intermediaries used. To determine whether to use intermediaries and what type of intermediaries would be appropriate, the firm should answer the following questions: 1. How does the new product fit with the distribution requirements of the firm’s existing product lines? Whether the firm already has an existing sales channel that would suit the product will be a primary consideration in how the product should be distributed.
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2. How numerous and dispersed are customers, and how much product educationor service will customers require? Is prepurchase trial necessary or desirable? 3. How are competing products or substitutes sold? The firm must consider how competing or substitute products are sold, because this both determines the nature of the existing distribution channel options and shapes customer expectations about how products will be purchased. Viral marketing is an attempt to capitalize on the social networks of individuals to stimulate word-of-mouth advertising.
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