Textbook Notes (368,566)
United States (206,084)
Marketing (51)
MKTG 2201 (50)
Chapter 10

MKTG 2201 Chapter 10: MKTG Chapter 10
Premium

7 Pages
96 Views
Unlock Document

Department
Marketing
Course
MKTG 2201
Professor
Thomas Lerra
Semester
Spring

Description
MKTG CHAPTER 10 Supply Chains • Upstream partners supply the raw materials, components, parts, information, finances, and expertise needed to create a product or service • Downstream partners serve as distribution channels that link the firm and its customers Value Delivery Network- 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 Marketing Channels • Interdependent organizations that help make a product or service available for use or consumption • Channel decisions o Affect every other marketing decisions o Can lead to competitive advantage o May involve long-term commitments to other firms How Channel Members Add Value • Intermediaries create greater efficiency in making goods available to target markets • Marketing intermediaries transform the assortments of products made by producers into the assortments wanted by consumers • Intermediaries bridge the major time, place, and possession gaps that separate goods and services from users Key Functions Performed by Channel Members Help to complete transactions • Information- consumers, producers, and other actors and forces in the marketing environment • Promotion- spread the word • Contact- find engaging consumers and prospective buyers • Matching- shaping offers to meet the buyers’ needs • Negotiation- reaching an agreement on price and other terms so that ownership or possession can be transferred Help to fulfill the completed transactions • Physical distribution • Financing • Risk taking Number of Channel Levels • Channel level: a layer of intermediaries that performs work in bringing the product and its ownership closer to the final buyer o Direct marketing channel: no intermediary levels o Indirect marketing channels: one or more intermediary levels • The number of intermediary levels indicates the length of a channel • Types of flows that connect the institutions in the channel: o Physical flow of products o Flow or ownership o Payment flow o Information flow o Promotion flow Channel Behavior • Channel conflict: disagreements among marketing channel members on goals, roles, and rewards o Horizontal conflict occurs among firms at the same level of the channel o Vertical conflict- conflict between different levels of the same channel Conventional Distribution Channel • 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. Vertical Marketing Systems • A vertical marketing system (VMS) consists of producers, retailers, and wholesalers • Members at different levels work together in a unified way to accomplish the work • Type 1: Corporate VMS o Combines successive stages of production and distribution under single ownership- channel leadership is established through common ownership • Type 2: Contractual VMS o Independent firms at different levels of production and distribution join together through contracts o Franchise organization: A channel member, a franchisor, links several stages in the production-distribution process ▪ Sponsored retailer franchise system- Ford and its dealers ▪ Manufacturer-sponsored wholesaler franchise system- Coca-Cola and its bottlers (wholesalers) ▪ Service-firm-sponsored retailer franchise system- Burger King • Type 3: Administered VMS o Coordinates successive stages of production and distribution through the size and power of one of the parties ▪ E.g.) Apple, GE can ask retailers for certain shelf space Horizontal marketing System • Two or more companies at one level join together to follow a new marketing opportunity o E.g.) McDonalds in Walmart, Hulu Multichannel Distribution Systems • A single firm sets up two or more marketing channels to reach customer segments • Advantages: o Expansion of sales and marketing coverage o Tailor-made products and services for individual customers • Disadvantages: o Can create conflict o Harder to control Changing Channel Organization • Disintermediation- cutting out of marketing channel intermediaries by product or service producers or the displacement of traditional resellers by radical new types of intermediaries Channel Design Decisions Marketing channel design- designing e
More Less

Related notes for MKTG 2201

Log In


OR

Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


OR

By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.


Submit