Kotler_MM_13e_Basic_15

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Designing and Managing Integrated Marketing Channels:

Designing and Managing Integrated Marketing Channels Marketing Management, 13 th ed 15

Chapter Questions:

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 15- 2 Chapter Questions What is a marketing channel system and value network? What work do marketing channels perform? How should channels be designed? What decisions do companies face in managing their channels? How should companies integrate channels and manage channel conflict? What are the key issues with e-commerce?

What is a Marketing Channel?:

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 15- 3 What is a Marketing Channel? A marketing channel system is the particular set of interdependent organizations involved in the process of making a product or service available for use or consumption.

Channels and Marketing Decisions:

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 15- 4 Channels and Marketing Decisions A push strategy uses the manufacturer’s sales force, trade promotion money, and other means to induce intermediaries to carry, promote, and sell the product to end users A pull strategy uses advertising, promotion, and other forms of communication to persuade consumers to demand the product from intermediaries

Buyer Expectations for Channel Integration:

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 15- 5 Buyer Expectations for Channel Integration Ability to order a product online and pick it up at a convenient retail location Ability to return an online-ordered product to a nearby store Right to receive discounts based on total online and offline purchases

Categories of Buyers:

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 15- 6 Categories of Buyers Habitual shoppers High value deal seekers Variety-loving shoppers High-involvement shoppers

Types of Shoppers:

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 15- 7 Types of Shoppers Service/quality customers Price/value customers Affinity customers

Channel Member Functions:

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 15- 8 Channel Member Functions Gather information Develop and disseminate persuasive communications Reach agreements on price and terms Acquire funds to finance inventories Assume risks Provide for storage Provide for buyers’ payment of their bills Oversee actual transfer of ownership

Designing a Marketing Channel System:

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 15- 9 Designing a Marketing Channel System Analyze customer needs Establish channel objectives Identify major channel alternatives Evaluate major channel alternatives

Channel Service Outputs:

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 15- 10 Channel Service Outputs Lot size Waiting/delivery time Spatial convenience Product variety Service backup

Identifying Channel Alternatives:

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 15- 11 Identifying Channel Alternatives Types of intermediaries Number of intermediaries Terms and responsibilities

Number of Intermediaries:

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 15- 12 Number of Intermediaries Exclusive Selective Intensive

Terms and Responsibilities of Channel Members:

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 15- 13 Terms and Responsibilities of Channel Members Price policy Condition of sale Distributors’ territorial rights Mutual services and responsibilities

Channel-Management Decisions:

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 15- 14 Channel-Management Decisions Selecting channel members Training channel members Motivating channel members Evaluating channel members Modifying channel members

Channel Power:

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 15- 15 Channel Power Coercive Reward Legitimate Expert Referent

Channel Integration and Systems:

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 15- 16 Channel Integration and Systems Vertical marketing systems Corporate VMS Administered VMS Contractual VMS Horizontal marketing systems Multichannel systems

What is Channel Conflict?:

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 15- 17 What is Channel Conflict? Channel conflict occurs when one member’s actions prevent another channel from achieving its goal. Types of channel conflict Vertical Horizontal Multichannel

Causes of Channel Conflict:

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 15- 18 Causes of Channel Conflict Goal incompatibility Unclear roles and rights Differences in perception Intermediaries’ dependence on manufacturer

Table 15.3 Strategies for Managing Channel Conflict:

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 15- 19 Table 15.3 Strategies for Managing Channel Conflict Adoption of superordinate goals Exchange of employees Joint membership in trade associations Cooptation Diplomacy Mediation Arbitration Legal recourse

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