Chapter 10: Marketing Channels

Question 1

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

Answer 1

Value delivery network

Question 2

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

Answer 2

Marketing channel (distribution channel)

Question 3

Gathering and distributing information about consumers, producers, and other actors and forces in the marketing environment needed for planning and aiding exchange

Answer 3

Information

Question 4

Developing and spreading persuasive communications about an offer

Answer 4

Promotion

Question 5

Finding and engaging customers and prospective buyers

Answer 5

Contact

Question 6

Shaping offers to meet the buyers needs, including activities such as manufacturing, grading, assembling and packaging

Answer 6

Matching

Question 7

Reaching an agreement on price and other terms so that ownership or possession can be transferred

Answer 7

Negotiation

Question 8

Transporting and storing goods

Answer 8

Physical distribution

Question 9

Acquiring and using funds to cover the costs of the channel work

Answer 9

Financing

Question 10

Assuming the risks of carrying out the channel work

Answer 10

Risk taking

Question 11

A layer of intermediaries that performs some work in bringing the product and its ownership closer to the final buyer

Answer 11

Channel level

Question 12

A marketing channel that has no intermediary levels

Answer 12

Direct marketing channel

Question 13

A marketing channel containing one or more intermediary levels

Answer 13

Indirect marketing channel

Question 14

Disagreements among marketing channel members on goals, roles, and rewards—who should do what and for what rewards

Answer 14

Channel conflict

Question 15

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

Answer 15

Conventional distribution channel

Question 16

A channel structure in which producers, wholesalers, and retailers act as a unified system. One channel member owns the others, has contracts with them, or had so much power that they all cooperate

Answer 16

Vertical marketing system (VMS)

Question 17

A vertical marketing system that combines successive stages of production and distribution under a single ownership—channel leadership is established through common ownership

Answer 17

Corporate VMS

Question 18

A vertical marketing System in which independent firms at different levels of production and distribution join together through contracts

Answer 18

Contractual VMS

Question 19

A contractual vertical marketing system in which a channel member, called a franchisor, links several stages in the production-distribution process

Answer 19

Franchise organization

Question 20

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

Answer 20

Administered VMS

Question 21

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

Answer 21

Horizontal marketing system

Question 22

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

Answer 22

Multichannel distribution system

Question 23

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

Answer 23

Disintermediation

Question 24

Designing effective marketing channels by analyzing customer needs, setting channel objectives, identifying major channel alternatives, and evaluating those alternatives

Answer 24

Marketing channel design

Question 25

Stocking the product in as many outlets as possible

Answer 25

Intensive distribution

Question 26

Giving a limited number of dealers the exclusive right to distribute the company’s products in their territories

Answer 26

Exclusive distribution

Question 27

The use of more than one but fewer than all of the intermediaries that are willing to carry the company’s products

Answer 27

Selective distribution

Question 28

Selecting, managing and motivating individual channel members and evaluating their performance over time

Answer 28

Marketing channel management

Question 29

Planning, implementing, and controlling the physical flow of goods, services, and related information from points of origin to points of consumption to meet customer requirements at profit

Answer 29

Marketing logistics (physical distribution)

Question 30

Managing upstream and downstream value-added flows of materials, final goods, and related information among suppliers, the company, resellers, and final consumers

Answer 30

Supply chain management

Question 31

A large, highly automated warehouse designed to receive goods from various plants and suppliers, take orders, fill them efficiently, and deliver goods to customers as quickly as possible

Answer 31

Distribution center

Question 32

Combining two or more modes of transportation

Answer 32

Multimodal transportation

Question 33

The logistics concept that emphasizes teamwork—both inside the company and among all the marketing channel organizations—to maximize the performance of the entire distribution system

Answer 33

Integrated logistics management

Question 34

An independent logistics provider that performs any or all of the functions required to get a clients product to market

Answer 34

Third party logistics (3PL) provider