Transcript MKT 304 Chap 10 Key PPT

MKT 304: Chapter 10 Key Concepts
Place Strategy & Channel Systems
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Place
Channel of distribution
Direct marketing
Discrepancy of quantity
Discrepancy of assortment
Regrouping activities
Accumulating
Bulk-breaking
Sorting
Assorting
Traditional channel systems
Channel captain
Vertical marketing systems
Corporate channel systems
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Vertical integration
Administered channel
systems
Contractual channel systems
Ideal market exposure
Intensive distribution
Selective distribution
Exclusive distribution
Dual distribution
Exhibit 10-1
Place Decisions Are an Important Part of Marketing Strategy
Chapters 11-12)
Reasons for Choosing Direct Channels
Greater Control
Lower Cost
Internet Makes Direct
Distribution Easier
Some
Possible
Reasons for
For Choosing
Direct Channels
Direct Contact with
Customer Needs
Quicker Response or
Change in Marketing Mix
Suitable Middlemen Not
Available
Channel Regrouping Activities
 Accumulating
 Collecting products from many small
producers
 Bulk Breaking
 Dividing larger quantities into smaller
 Sorting
 Separating products into grades and
qualities desired by consumers
 Assorting
 Putting together a variety of products that
the target market wants
Channel Relationship Must be Managed
Choosing the Type of
Relationship
Key
Issues In
Channel
Management
Whole-Channel ProductMarket Commitment
Conflict Handling
Common Objectives
Role of Channel Captain
Vertical Marketing Systems
Focus on Final Customers
Type of channel
Characteristics
Vertical marketing systems
Traditional
Administered
Contractual
Corporate
Little or
none
Some to
good
Fairly good
to good
Complete
Control maintained
by
None
Economic
power and
leadership
Contracts
One
company
ownership
Examples
Typical
“independents”
General
Electric
McDonald’s
Florsheim
Amount of
cooperation
The Best Channel System Should Achieve
Ideal Market Exposure
Intensive
Market
Exposure
Strategies
Selective
Exclusive
= number of
outlets
Limiting Market Exposure
Producer
Vertical
Arrangements
May Be Legal
Wholesaler
Retailer
Retailer
Retailer
Retailer
Retailer
Horizontal Arrangements
Are Illegal