ࡱ> BDA#` qbjbj\.\. .0>D>Dq L$h,,A6:Oo R^ W0  ,,  SEGMENT 14: CHANNEL STRATEGY (Related chapter in text: 15) LEARNING OBJECTIVES: 1. Understand how channel strategy creates time and place utility 2. Delineate key functions of the channel of distribution 3. Distinguish intensive vs. selective vs. exclusive channels and direct vs. indirect channels 4. Know the roles of the various forms of marketing intermediaries - wholesalers and retailers 5. Know the advantages and disadvantages of contractual, administered, and vertically-integrated channels CREATING PLACE AND TIME UTILITIES-roots of practice where things are produced and how they get where the consumers are marketing spawned by distribution TIME UTILITY CONVENIENCE- mininimize time making purchase, buy when you want too SPEED-getting the product there quickly PLACE UTILITY CONVENIENCE-having a product readily available in lots of areas PRESTIGE- place where we purchase products increases the prestige of the product (balharbor and Gucci) through the prestige of retailer DISTINGUISHING CHANNEL OF DISTRIBUTION FROM PHYSICAL DISTRIBUTION OF PRODUCTS (not just transportation) -Logistical Functions --Assorting (creating assortment of different products, selection) , Transporting-how we move the product -Transactional Functions --Selling (selling the products, speciality org, represent product dont take onventory ), Risk taking ( who is going to make investment in product) -Facilitating Functions --Financing (manu or retailer) , Market research (feedback from marketplace) DEGREE OF CHANNEL COVERAGE: 3 BASIC OPTIONS (how widespread, how saturated the market) INTENSIVE-convenient good (gum, coke) convenient stores SELECTIVE- a few outlets that sell the product 2-3 EXCLUSIVE- one outlet in geographical area to build prestige, along with car dealers, along with high tech bicycles, out of your way to buy the brand TWO BASIC TYPES OF CHANNELS DIRECT- is awhen a manu is dealing directly with end user, say from manu website (ship directly) to consumer (dell) too many consumers so use indirect INDIRECT- typicall- manu- to wholesaler-retailer-consumer.. Channel conflict... manu-retailer-consumer manu to consumer, retailer isnt happy because they are taking sales.. Movies to dvd-horizontal Manu-bottlers-retailers-consumers. Powerade directly to retailers instead of bottlers vertical A "TYPICAL" CHANNEL MANUFACTURER ( WHOLESALER ( RETAILER ( CONSUMER TYPES OF CHANNEL MEMBERS (ALSO KNOWN AS INTERMEDIARIES OR MIDDLEMEN) WHOLESALERS- sell to retailers MERCHANT WHOLESALERS -DISTRIBUTOR-full function wholesaler, perform all functions (selling, catalog, inventory, credit, employee, parts inventory, feedback) -JOBBER-performs subsets, ( has inventory) AGENTS-does not own product, or inventory-provide sales and service MANUFACTURER'S SALES BRANCH VS. SALES OFFICE-parraelel between distrubitor and agents, owned by manu Owned and take possession (sales branch), Independent and take possession (Merchant wholesaler) Independent dont take possession (agent) owned, dont take possession (sales office) RETAILERS - STORE- 4 types of stores SPECIALTY-small stores, narrow merchandise DEPARTMENT STORES ( diverse, dillards, anchor store) POWER RETAILERS-specialized large stores, (home depot) more depth DISCOUNTERS walmart, target NONSTORE- internet retailing, networking to consumers CHANNEL TYPES CONTRACTUAL-relationship is governed by contract e.g., FRANCHISING-get power of well developed corporate backing them, centralized planning, advertising powers ability to expand rapidly, disadvantage is quality of control ADMINISTERED- handshake agreement, independent convenient store and buying coca-cola vault, big dog runs show, who has more power gets better deal VERTICALLY INTEGRATED-one entity owns entire channel (nokia opening its own stores, forward) backward is amazon buying rights to make movie. Gets rid of conflict of independent channels helps with control KEY TRADEOFF COST VS. CONTROL-cost to own everything is very expensive (CHANNEL CAPTAIN)-has the most power over the manu and retailer for instance walmart asking p&G to cut packaging for green marketing retailers having more power than manu QUESTION: WHY USE INTERMEDIARIES?- ANSWER: TRANSACTION EFFICIENCY- O O O O O O O O O O O O O O O O O ;    & PZv>Refvw=Icdesq jhDS jhDSOJQJ hDS>*hhDS5hhDS5>*hDS hDSCJ#;<QR0 1  0hgdDS 0hh^h`gdDS ,`0p@ P gdDS ) `0p@ P gdDS$ P a$gdDSgdDSq   & ' h i \  07^7gdDS & F 0gdDS 0gdDS 07^7gdDS & F 0S^S`gdDS 0hgdDS\ ] s OPQWXYZvw 07^7gdDS & F 0gdDS 0gdDSwMN=>RS`grx 0`gdDS 0gdDS 07^7gdDS & F 0gdDS~ 0^gdDS & F 0L^`LgdDS 07^7gdDS 0gdDS & F 0R^R`gdDS678IJde  r 0^gdDS & F 0gdDS 07^7gdDS & F 0gdDS & F 0L^`LgdDS 0gdDS & F 0$ L^$ `LgdDS )*+abcdest_`a 0^gdDS & F 0SL^S`LgdDS & F 0gdDS 0^gdDS 0gdDS & F 0gdDSa   0`gdDS 0gdDS 0^gdDS & F 0SL^S`LgdDS+5FGHXYZ[klmnopq 0gdDS 0`gdDS,1h/ =!"#$% @`@ DSNormalCJ_HaJmH sH tH \`\ DS Heading 3%$$ P @&a$ 5>*aJDAD Default Paragraph FontRiR  Table Normal4 l4a (k(No Listq0;<QR01&'hi\]sOPQWXYZvwMN= > R S ` g r x     ~  6 7 8 I J d e ) * + a b c d e s t _`a  +5FGHXYZ[klmnops(@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@ 0@0@ 0@0@0@0@ 0@0@ 0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@ 0@0@ 0@0@ 0@0@0@0@0@0@ 0@0@ 0@0@ 0 @0@ 0 @0@0@0@0@0@0@0@0@0@0@0@0L0@0@0@0@0@0@0@ 0 @0@0@0@0@ 0 @0@ 0 @0@ 0@0@ 0@0@0@ 0@0@ 0@0@ 0@0@ 0@0@ 0@0@0@ 0@0@0@0@0@0@0@ 0@0@0@0@0@0@ 0@0@0@ 0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0@0h00q  \ w aqq%HQ#%)bfz~ E N W b x |   -2agCGbiqtsHSJL ;?s3333333sXV2-*((^(`o(-Xii 2@ R^R`OJQJo(dDS s@ppappqp@UnknownGz Times New Roman5Symbol3& z ArialG WP MathASymbol"qhJJ!24ii2qHP)?DS2SEGMENT 14: CHANNEL STRATEGYSmathers LibrariesSmathers Libraries  Oh+'0 ,8 X d p| SEGMENT 14: CHANNEL STRATEGYSmathers LibrariesNormalSmathers Libraries2Microsoft Office Word@@bAi@bAi՜.+,0 hp  University of Floridai SEGMENT 14: CHANNEL STRATEGY Title  "#$%&'()*+,-./02345678:;<=>?@CRoot Entry FEData 1Table!WordDocument.0SummaryInformation(1DocumentSummaryInformation89CompObjq  FMicrosoft Office Word Document MSWordDocWord.Document.89q