Post on 04-Jun-2018
transcript
8/13/2019 LHM 12e ch13_PPT_IE
1/52
Chapter 13: Marketing Channels
Prepared and Designed by Laura Rush, B-books Ltd.
1Copyright Cengage Learning 2013All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
2/52
Learning Outcomes
LO1
LO2
LO3
Explain what a marketing channel is and whyintermediaries are needed
Define the types of channel intermediaries
and describe their functions and activities
Describe the channel structures for
consumer and business products and
discuss alternative channel arrangements
Discuss the issues that influence channel
strategyLO4
2Copyright Cengage Learning 2013All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
3/52
Learning Outcomes
Describe the different channel relationship
types and their unique costs and benefits
Explain channel leadership, conflict, and
partnering
Discuss channels and distribution
decisions in global markets
Identify the special problems andopportunities associated with distribution
in service organizations
LO5
LO6
LO8
LO7
3Copyright Cengage Learning 2013All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
4/52
Marketing Channels
Explain what a marketingchannel is and why
intermediaries are needed.
LO14Copyright Cengage Learning 2013All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
5/52
Marketing Channels
A set ofinterdependent organizations
that ease the transfer ofownership as products move
from producer to businessuser or consumer.
5Copyright Cengage Learning 2013All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
6/52
Marketing Channel Functions
Specialization and division of labor
Overcoming discrepancies
Providing contact efficiency
6Copyright Cengage Learning 2013All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
7/52
Specialization and Division of Labor
Creates greater efficiency
Provides lower costs
Achieves economies of scale
Aids producers who lack resources
to market directly
Builds good relationships withcustomers
7Copyright Cengage Learning 2013All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
8/52
8/13/2019 LHM 12e ch13_PPT_IE
9/52
Overcoming Discrepancies
Temporal
Discrepancy
Spatial
Discrepancy
A situation that occurs when a
product is produced but a
customer is not ready to buy it.
The difference between the
location of a producer and the
location of widely
scattered markets.
9Copyright Cengage Learning 2013All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
10/52
Providing Contact Efficiency
10Copyright Cengage Learning 2013 All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
11/52
Review Learning Outcome
Marketing Channels
LO1
Providing Specialization
and Division of Labor
Overcoming
Discrepancies
Providing Contact
Efficiency
MarketingChannel
Supply
Chain
11Copyright Cengage Learning 2013
All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
12/52
Channel Intermediaries
Define the types of channelintermediaries and describetheir functions and activities.
LO2
12Copyright Cengage Learning 2013
All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
13/52
Channel Intermediaries
RetailerA channel intermediary that
sells mainly to customers.
Merchant
Wholesaler
An institution that buys goodsfrom manufacturers, takes titleto goods, stores them,
and resells and ships them.
Agents and
Brokers
Wholesaling intermediaries whofacilitate the sale of a product from
producer to end user by representingretailers, wholesalers, or
manufacturers.
13Copyright Cengage Learning 2013All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
14/52
Channel Intermediaries
Retailers
MerchantWholesalers
AgentsandBrokers
Take Title to Goods
Take Title to Goods
Do NOT Take Title to Goods
14Copyright Cengage Learning 2013All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
15/52
Factors Suggesting Type of
Wholesaling Intermediary to Use
Product characteristics
Buyer considerations
Market characteristics
15Copyright Cengage Learning 2013All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
16/52
Channel Functions Performed
by Intermediaries
Contacting/Promotion
Negotiating
Risk Taking
Researching
Financing
Physically distributing
Storing
Sorting
FacilitatingFunctions
TransactionalFunctions
LogisticalFunctions
16Copyright Cengage Learning 2013 All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
17/52
Logistics
The efficient and cost-effective
forward and reverse flow as
well as storage of goods, services, and
related information, into, through, and
out of channel member companies.
17Copyright Cengage Learning 2013All Rights Reserved
O
8/13/2019 LHM 12e ch13_PPT_IE
18/52
Review Learning OutcomeChannel Intermediaries and Functions
LO2
CHANNELINTERMEDIARIES
Retailers
Wholesalers
Agents and Brokers
CHANNELFUNCTIONS
Transactional
Logistical
Facilitating
Perform
18Copyright Cengage Learning 2013
All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
19/52
Channel Structures
Describe the channelstructures for consumerand business productsand discuss alternativechannel arrangements.
LO3
19Copyright Cengage Learning 2013
All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
20/52
Channels for Consumer Products
Direct Channel - A distributionchannel in which producerssell directly to consumers.
20Copyright Cengage Learning 2013All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
21/52
Producer Producer Producer Producer
Consumers Consumers Consumers Consumers
Retailers Retailers Retailers
Wholesalers Wholesalers
Agents orBrokers
Wholesaler
Channel
Retailer
ChannelDirect
Channel
Agent/Broker
Channel
Channels for Consumer Products
21Copyright Cengage Learning 2013
All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
22/52
Channels for Business Products
Producer
IndustrialUser
Direct
Channel
Producer
Govt.Buyer
Direct
Channel
Producer Producer Producer
IndustrialUser
IndustrialUser
IndustrialUser
IndustrialDistributor IndustrialDistributor
Agents orBrokers
Agents orBrokers
Agent/Broker
Channel
Industr ial
Distr ibutorAgent/Broker
Industr ial
Channel
22Copyright Cengage Learning 2013
All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
23/52
Business Exchanges on the Internet
Agents link buyers and sellers
Companies drop the intermediary from
the supply chain
Private exchanges with select suppliers
automate the supply chain
Online
http://www.sherwinwilliams.com
23Copyright Cengage Learning 2013All Rights Reserved
http://www.sherwinwilliams.com/http://www.sherwinwilliams.com/8/13/2019 LHM 12e ch13_PPT_IE
24/52
Alternative Channel Arrangements
Multiple channels
Strategic channel alliances
Nontraditional channels
24Copyright Cengage Learning 2013All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
25/52
Review Learning OutcomeChannel Structures
LO3
CONSUMERCHANNELS
Direct
Retail
Wholesaler
Agent/broker
BUSINESSCHANNELS
Direct
Industrial
Agent/broker
Agent/broker
industrial
ALTERNATIVECHANNELS
Multiple
Nontraditional
Strategic
alliances
25Copyright Cengage Learning 2013
All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
26/52
Making Channel Strategy Decisions
Discuss the issues that
influence channel strategy.
LO4
26Copyright Cengage Learning 2013
All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
27/52
Channel Strategy Decisions
FactorsAffectingChannelChoice
Producer Factors
Product Factors
Market Factors
Exclusive Distribution
Selective Distribution
Intensive Distribution
Level ofDistribution
Intensity
27Copyright Cengage Learning 2013All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
28/52
Market Factors
MarketFactorsThat AffectChannelChoices
Customer profiles
Consumer or Industrial
Customer
Size of market
Geographic location
28Copyright Cengage Learning 2013All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
29/52
Product Factors
ProductFactors
That AffectChannelChoices
Product Complexity
Product Standardization
Product Life Cycle
Product Delicacy
Product Price
29Copyright Cengage Learning 2013All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
30/52
Producer Factors
ProducerFactors
That AffectChannelChoices
Producer Resources
Number of Product Lines
Desire for Channel Control
30Copyright Cengage Learning 2013All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
31/52
Levels of Distribution Intensity
IntensiveA form of distribution aimed athaving a product available
in every outlet
SelectiveA form of distribution achievedby screening dealers to eliminate
all but a few in any single area
Exclusive
A form of distribution thatestablished one or a fewdealers within a given area
31Copyright Cengage Learning 2013 All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
32/52
Levels of Distribution Intensity
IntensiveAchieve mass marketselling.Convenience goods.
Many
Selective
Exclusive
Work with selectedintermediaries.Shopping and somespecialty goods.
Work with singleintermediary. Specialtygoods and industrialequipment.
Several
One
Intensity
Level Objective
Number of
Intermediaries
32Copyright Cengage Learning 2013All Rights Reserved
R i L i O
8/13/2019 LHM 12e ch13_PPT_IE
33/52
Review Learning OutcomeIssues Influencing Channel Strategy
LO4
33
8/13/2019 LHM 12e ch13_PPT_IE
34/52
Types of Channel Relationships
Describe the different channelrelationship types and their
unique costs and benefits.
LO5
34
Copyright Cengage Learning 2013
All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
35/52
Types of Channel Relationships
Cooperative
Integrated
Arms Length
35Copyright Cengage Learning 2013All Rights Reserved
A L th d I t t d
8/13/2019 LHM 12e ch13_PPT_IE
36/52
Arms Length and Integrated
Relationships
Arms Length Relationship- A
relationship between companies
that is loose, characterized by
low Relational investment and
trust, and usually taking the form
of a series of discrete
transactions with no/lowexpectation of future interaction
or service.
Integrated Relationship- A relationship
between companies that is tightlyconnected, with linked processes across
and between firm boundaries, and
high levels of trust and inter-firm
commitment.
36Copyright Cengage Learning 2013 All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
37/52
Cooperative Relationships
A relationship between companies
that takes the form of informal
partnership with moderate levels of
trust and information sharing as
needed to further each companys
goals.
37Copyright Cengage Learning 2013All Rights Reserved
Review Learning Outcome
8/13/2019 LHM 12e ch13_PPT_IE
38/52
Review Learning OutcomeTypes of Channel Relationships
LO
5
38
Copyright Cengage Learning 2013
All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
39/52
Managing Channel Relationships
Explain channel leadership,
conflicts, and partnering.
LO6
39
Copyright Cengage Learning 2013
All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
40/52
Managing Channel Relationships
Partnering
Conflict
Leadership
Control
Power
40Copyright Cengage Learning 2013All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
41/52
Channel Power, Control, and Leadership
Channel
Power
The capacity of a particularmarketing channel member to
control or influence the behavior
of other channel members
Channel
Control
A situation that occurs whenone marketing channel member
intentionally affects another
members behavior
Channel
Leader
(channel captain)
A member of a marketingchannel that exercises
authority/power over the
activities of other members
41Copyright Cengage Learning 2013All Rights Reserved
Ch l C fli t d P t i
8/13/2019 LHM 12e ch13_PPT_IE
42/52
Channel Conflict and Partnering
Channel ConflictA clash of
goals and methods between
distribution channel members.
Channel Partnering (Channel Cooperation)
The joint effort of all channel
members to create a supply
chain that serves customers and
creates a competitive advantage.
42Copyright Cengage Learning 2013
All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
43/52
Channel Conflict
Conflicts may occur if channel members:
Have conflicting goals
Fail to fulfill expectations of other channel members
Have ideological differences
Have different perceptions of reality
43Copyright Cengage Learning 2013
All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
44/52
Channel Partnering
Supplier /ManufacturerRelationships
Short-term
Adversarial
Independent
Price important
Long-term
Cooperative
Dependent
Value-added services
Number ofSuppliers
Many Few
Transaction-Based Partnership-Based
InformationSharing
Minimal High
InvestmentRequired
Minimal High
44Copyright Cengage Learning 2013
All Rights Reserved
Review Learning Outcome
8/13/2019 LHM 12e ch13_PPT_IE
45/52
Review Learning OutcomeChannel Leadership, Conflict, & Partnering
LO6
Channel
RelationshipSynergy
Channel Conflict
Horizontal Vertical
Channel Power,
Control, Leadership
Channel
Partnering
45Copyright Cengage Learning 2013
All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
46/52
Channels and Distribution Decisions
for Global Markets
Discuss channels and
distribution decisions
in global markets.
LO746Copyright Cengage Learning 2013
All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
47/52
Channels and Distribution Decisions
for Global Markets
Global ChannelDevelopment
Channel structureand type differ
Gray marketing channels
47Copyright Cengage Learning 2013
All Rights Reserved
Review Learning Outcome
8/13/2019 LHM 12e ch13_PPT_IE
48/52
Review Learning Outcome
LO7
Global Market Channel & Distribution Decisions
Distribute directly or through
foreign partners
Different channel structures than in
domestic markets
Illegitimate gray
marketing channels
Legal and infrastructure differences
48Copyright Cengage Learning 2013
All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
49/52
Channels and Distribution Decisions
for Services
Identify the special problemsand opportunities
associated with distribution
in service organizations
LO8 49Copyright Cengage Learning 2013
All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
50/52
Channels and Distribution Decisions
for Services
Minimizing wait times
Managing service capacity
Improving service delivery
50Copyright Cengage Learning 2013
All Rights Reserved
Review Learning Outcome
8/13/2019 LHM 12e ch13_PPT_IE
51/52
Review Learning OutcomeDistribution in Service Organizations
LO8 51Copyright Cengage Learning 2013
All Rights Reserved
8/13/2019 LHM 12e ch13_PPT_IE
52/52
Chapter 13 Company Clip
The beauty-retail store, Sephora, has
become a leader in sales of health and
beauty-aid products. It uses a variety of
techniques to keep its shelves stocked andits customers happy.
http://www.cengage.com/marketing/book_content/9781111821647_lamb/videos/ch13.html
Copyright Cengage Learning 2013 52
http://www.cengage.com/marketing/book_content/9781111821647_lamb/videos/ch13.htmlhttp://www.cengage.com/marketing/book_content/9781111821647_lamb/videos/ch13.htmlhttp://www.cengage.com/marketing/book_content/9781111821647_lamb/videos/ch13.htmlhttp://www.cengage.com/marketing/book_content/9781111821647_lamb/videos/ch13.html