Marketing Channel Factors and Designs

By: James Jenkins

Introduction

Marketing Channel: individuals and firms involved in making a product or service available for consumption by consumers or industrial users

Consists of Producers, agents, wholesalers, retailers, and consumers

Channel Choice and ManagementFactors

Choices between different marketing channels depend on factors involved

Environmental- Changing lifestyles, growing technology, and regulatory factors

Tupperware Lifting the ban of chewing gum in Singapore

Strict laws lighten up Chewing Gum banned in 1992 after littering

problem Ban was finally partially lifted in 2004 for

prescriptions and smokers Not available in convenience stores ID required

Factors cont.

Consumer- choosing best intermediary to reach target market

Answering questions: Who? Where? When? How? What?

Product- distribution is determined by value of products

Sophisticated products sold directly Low involvement products sold indirectly

Factors cont.

Company-based on the firm’s financial, human, or technological capabilities

Applies to intermediaries as well

Channel Designs

With many alternatives and factors considered, firms have three major points to be recognized:

Coverage of target market Satisfying Buyer Requirements Profitability

Designs cont.

Target Market Coverage- using density of stores for distribution of product

Intensive- placement of product in as many stores possible

Exclusive- distribution into only one outlet that carries item

Selective- firm selects a few retail outlets to provide product

Design cont.

Satisfying Buyer Requirements- fulfilling needs that buyers may have

Includes information, convenience, variety, and attendant services

Maximizing Profit- considering distribution, advertising, and expenses to choose best channel

Conclusion

Marketing channels need to be well coordinated and planned so that the firms maximize their productivity

This also is necessary to keep the consumers satisfied

Works Cited

www.wrigley.com/products/side_orbit.gif

http://news.bbc.co.uk/2/hi/uk_news/3512498.stm