Kotler15_media.ppt 2650KB Aug 31 2008 10:00:36 PM

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MARKETING MANAGEMENT

12th_edition

15

Designing and

Managing

Value Networks and

Channels

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15-2

Chapter Questions

• What is a marketing channel system and

value network?

• What work do marketing channels perform?

• How should channels be designed?

• What decisions do companies face in

managing their channels?

• How should companies integrate channels

and manage channel conflict?

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Marketing Channels

Sets of interdependent organizations involved in the process of making a

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Channels and

Marketing Decisions

Push

Strategy

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Categories of Buyers

Habitual shoppers

High value deal seekers

Variety-loving shoppers

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Buyer Expectations for

Channel Integration

• Ability to order a product online and pick it up at a convenient retail location • Ability to return an

online-ordered product to a nearby store

• Right to receive

discounts based on total online and offline

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Should the 4 P’s be replaced?

• Solutions

• Information

• Value

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[image:8.720.40.663.107.395.2]

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Channel Member Functions

• Gather information

• Develop and disseminate persuasive

communications

• Reach agreements on price and terms

• Acquire funds to finance inventories

• Assume risks

• Provide for storage

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[image:10.720.19.684.103.461.2]

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[image:11.720.58.606.131.506.2]

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Figure 15.3

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[image:12.720.144.573.131.478.2]

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Designing a Marketing Channel

System

Analyze customer needs

Evaluate major channel alternatives

Identify major channel alternatives

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Channel Service Outputs

Lot size

Waiting/delivery time

Spatial convenience

Product variety

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Identifying Channel Alternatives

Types of

intermediaries

Number of

intermediaries

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Number of Intermediaries

Exclusive

Selective

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[image:17.720.48.696.78.452.2]

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[image:18.720.91.696.104.475.2]

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Figure 15.5 Break-Even Chart for the Choice Between A Company Sales Force and

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Channel-Management Decisions

Selecting channel members

Training channel members

Motivating channel members

Evaluating channel members

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Channel Power

• Coercive

• Reward

• Legitimate

• Expert

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Channel Integration and Systems

_{Vertical marketing}

systems

• Corporate VMS

• Administered VMS • Contractual VMS

_{Horizontal marketing}

systems

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[image:22.720.101.606.137.499.2]

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Managing Channel Conflict

• Adoption of

superordinate goals • Cooptation

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e-Commerce Marketing Practices

• Pure-click

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Marketing Debate

 _{Does it matter where you are sold?}

Take a position:

1. Channel images do not really affect the brand images of the products they they sell that much.

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Marketing Discussion



Think of your favorite retailers.

How have they integrated their

channel system? How would you

like their channels to be integrated?