12. Marketing Channels

Question 1

Upstream partners

Answer 1

The set of firms that supply raw materials, components, parts, info, finances etc. needed to create a product or service.

Question 2

Make and sell view (supply chain)

Answer 2

The raw materials, productive inputs, and factory capacity should derve as the starting point for marketing planning.

Question 3

Serve-and respong view, Demand chain (supply chain)

Answer 3

Planning starts by identifying the needs of target customers to which the company responds by organizing a chain of resources and activities.

Question 4

Value delivery network

Answer 4

A network composed of the company, suppliers, distributors and ultimately customers who partner with each other to improve the performance of the entire system in delivering customer value.

Question 5

Marketing channel (distribution channel)

Answer 5

The downstream. A set of independent organizations that help make a product or service available for use or consumption by the consumer or business user.

Question 6

Members of the marketing channel helping to complete transactions

Answer 6

Information, Promotion (persuasive communications about an offer), Contact (finding and engaging customers), Matching (shaping offers), Negotiation (reaching an agreement on price and other terms)

Question 7

Same but helping fulfill completed transactions

Answer 7

Physical distribution, Financing, Risk taking

Question 8

Channel level

Answer 8

A layer of intermediaries that performs some work in bringing the product and its ownership closer to the final buyer. The number of levels indicates the length of a channel.

Question 9

Direct marketing channel

Answer 9

A marketing channel that has no intermediary levels.

Question 10

Indirect channel

Answer 10

A marketing channel containing one or more intermediary levels.

Question 11

Flows in the channel

Answer 11

Physical flow of products, Flow of ownership, Payment flow, Information flow, Promotional flow

Question 12

Channel conflict

Answer 12

Disagreements among marketing channel members on goals, roles, and rewards - who should do what and for what reward. Horizontal conflict (among firms at the same level of the channel) and vertical conflict (between different levels of the same channel).

Question 13

Conventional distribution channel

Answer 13

A channel consisting of one or more independent producers, wholesalers, and retailers, each a separate business seeking to maximize its own profits, perhaps even at the expense of profits for the system as a whole.

Question 14

Vertical marketing system (VMS)

Answer 14

A channel structure in which producers, manufacturers and retailers act as a unified system. One channel meber owns the others, has contracts with them, or has so much power that they all cooperate. Corporate, contractual and administrated VMS.

Question 15

Corporate VMS

Answer 15

A VMS that combines successive stages of production and distribution under single ownership - channel leadership is established through common ownership.

Question 16

Contractual VMS

Answer 16

A VMS in which independent firms at different levels of production and distribution join together through contracts. franchise

Question 17

Franchise organizations

Answer 17

A contractual VMS in which a channel member, called a franchisor, links several stages in the production-distribution process. (manufacturer-sponsored retail franchise system, manufacturer-sponsored wholesaler franchise system, service-firm-sponsored retailer franchise system.

Question 18

Administrated VMS

Answer 18

A vertical marketing system that coordinates successive stages of production and distribution through the size and power of one of the parties.

Question 19

Horizontal marketing systems

Answer 19

A channel arrangement in which two or more companies at one level join together to follow a new marketing opportunity.

Question 20

Multichannel distribution system

Answer 20

A distribution system in which a single firm sets up to two or more marketing channels to reach one or more customer segments.

Question 21

Disinermediation

Answer 21

The cutting out of marketing channel intermediaries by product or service producers or the displacement of traditional resellers by radical new types of intermediaries.

Question 22

Marketing channel design

Answer 22

Designing effective marketing channels by analyzing customer needs, setting channel objectives, identifying major channel alternatives (types, number and responsibilities of each channel member), and evaluation those alternatives.

Question 23

Channel objectives

Answer 23

Which segments to serve and the best channels to use in each case, compete in the same outlets or not, environmental factors (economic conditions and legal constraints)

Question 24

Types of intermediaries

Answer 24

Phone/online marketing channel, sales force, retailers, value-added resellers,

Question 25

Intensive distribution

Answer 25

Stocking the product in as many outlets as possible.

Question 26

Exclusive distribution

Answer 26

The producer gives only a limited number of dealers the exclusive right to distribute its products in their territories.

Question 27

Selective distribution

Answer 27

Between the intensive and exclusive. The use of more than one but fewer than all of the intermediaries who are willing to carry a company's products.

Question 28

Evaluating the major alternatives

Answer 28

Economic (the likely sales, costs and profitability), control and adaptability criteria.