firms that buy products from manufacturers and resell to retailers then sell to consumers. Viral Marketing Program encourages people to pass along marketing messages to others. Distribution Center a facility for the receipt, storage and redistribution of gods to company stores, may be operated by retailers, manufacturers or distribution specialists. Less Price Competition More Price Competition 4 Levels of Competition Monopoly : One firm controls the market Oligopoly : A handful of firms control the market Fewer Firms Monopolistic Comp .: Many firms selling differentiated products at different prices Pure Comp .: Many firms selling commodities for the same price Many Firms
Fulfillment Centers are like distribution centers but instead of shipping to stores they ship directly to customers. 2 Types of Marketing Channels all marketing channels take form of one or combo 1. Direct Marketing Channel no intermediaries and manufacturer sells directly to the buyer ex: Etsy or eBay 2. Indirect Marketing Channel one or more intermediaries work with manufacturer to provide goods and services to customer’s ex: Ford or GM. Managing Marketing Channels all participating members must cooperate, Vertical Channel Conflict is when members that buy and sell to one another are in disagreement, Horizontal Channel Conflict when there is a disagreement among members at the same level ex: two retailers competing. Independent OR Conventional Marketing Channel several independent members attempt to satisfy their own objectives and max profits often at the expense of other members, Vertical Marketing System (3 Types) a marketing channel in which members act unified A. Administered Vertical Marketing System is when there is no common ownership or contractual relationships, but the dominant channel member controls the balance of power ex: Walmart hold power over PenAgain, Power (6) when one firm has the means or ability to dictate the actions of another member at a different level of distribution, Reward Power when a member offers an incentive usually monetary to make the other member do what it wants, Coercive Power arises when Walmart threatens to punish or punishes the other channel member for not undertaking certain tasks, such as if it were to delay payment to PenAgain for a late delivery, Referent Power occurs if one channel member wants to be associated with another member ex Walmart has this power over PenAgain, Expertise Power when a channel member uses its expertise to leverage to influence the actions of another channel member, Information Power over PenAgain by providing or withholding such important market information ex: Walmart has vast information about the office supply and back-to-school markets, Legitimate Power is based on getting a channel member such as PenAgain to behave in a certain way because of a contractual agreement between the two firms, B. Contractual Vertical Marketing System independent firms at different levels of the marketing channel join through contracts to obtain economies of scale and coordination and to reduce conflict, most common type is Franchising
You've reached the end of your free preview.
Want to read all 4 pages?
- Spring '08