Marketing ChannelsDelivering Customer Value

Chris Beltran, Messaline Clement, Mireya Gama, Cody Prue

Agenda

Chapter 12 Key IdeasVideoIn-N- Out Comprehensive ModelDiscussion Questions

The Value Delivery Network

Direct Marketing Channel vs. Conventional Marketing

Channel

Consumer

Retailer

Wholesaler

Producer

Consumer

Producer

Direct Conventional

Vertical Marketing System In-N-Out: Corporate VMSFord: Contractual VMS Walmart, Home Depot: Administered VMS

Horizontal Marketing SystemWalmart & McDonaldsTaco Bell & Pizza Hut

Multichannel Distribution

Channel Design Decision

Supply Chain Management• Managing upstream and downstream

value- added flows of materials, final goods, and final consumer

Supply Chain Management

Channel Management Decision

Selecting Channel MembersManaging and motivating channel members

Evaluating channel members

Public Policy and Distribution DecisionsExclusive territorial agreements

Producer or seller limit territory

Exclusive dealing Seller requires that the sellers not handle

competitor’s products

Exclusive distribution Seller allows only certain outlets to carry its

products

Tying agreements Dealer must take most or all of the line

Major Logistics Functions

Warehousing Inventory Management

Transportation

Logistics Information

Management

Marketing logistics: Planning, implementing, and

controlling the physical flow of goods and services from points of origin to points of consumption

Transportation Trucks- 40% Railroads- 40% Water carriers- Less than 5% Air carriers & Pipelines- Less

than 1%

Third Party Logistics3PL Supply Chain Defined as a firm that provides service to its

customers of outsourced (3rd Party) logistics as part of their supply chain management functions.

Typically specialized in warehousing and transportation that can be catered to customers needs.

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Tangible Good

Introduction Leading fast- food retail chain with over 200 locations in

California, Nevada, and Arizona Private, family- run, non- franchised company

Harry Snyder and his wife, Esther, opened what is said to be California's first drive-thru restaurant.

Known for its made- to –order hamburgers, fresh ingredients and efficient service

Maintained the steady rate of expansion with traditional menu and a simple, customer- friendly philosophy

Distribution

Own distribution system Private butchers, warehouses, truck lines Must improve system to expand beyond west

coast and maintain strategic position

Comprehensive Model of the Marketing Distribution Channel

Supplier In-N-Out

Consumer

Distributor

Discussion Questions Do you believe In-N-Out Burger should remain non

franchised or branch out like their competitors?What are the complexities of using international

distribution channels?

Referenceshttp://extensionengine.com/project-vs-product-

management/

http://www.referenceforbusiness.com/history/He-Ja/In-N-Out-Burgers-Inc.html#b

http://partners.visitrenotahoe.com/innoutburger