Channel Flows

                                  Nature of Distribution Channels:
                                 Why Use Marketing Intermediaries?

                                 Why Use Marketing Intermediaries?

                                   Distribution Channel Functions

                               Traditional Marketing Channel Designs

                                  The Design of Marketing Channels

                                  The Design of Marketing Channels

*                 Buyers are easily identifiable

*                 Personal selling is a major component of the communication mix

*                 Organization has a wide variety of offerings for the target market

*                 Sufficient resources are available

                                  The Design of Marketing Channels

*          Intermediaries are not available for reaching target markets

*          Intermediaries do not possess the capacity to service the requirements of target markets

                                  The Design of Marketing Channels

*          Intermediaries can perform distribution functions more efficiently and less expensively

*          Customers are hard to reach directly

*          Organization does not have resources to perform distribution function

                               Channel Selection at the Retail Level
                                       Target Market Coverage

                            Conventional vs. Vertical Marketing Systems

                                Types of Vertical Marketing Systems

                            Nature and Importance of Marketing Logistics

•            Involves getting the right product to the right customers in the right place at the
right time.

•            Companies today place greater emphasis on logistics because:

  –       customer service and satisfaction have become the cornerstone of marketing strategy.

  –       logistics is a major cost element for most companies.

  –       the explosion in product variety has created a need for improved logistics management.

  –       Improvements in information technology has created opportunities for major gains in
  distribution efficiency.

                                        Channel Management:
                                     Evaluating Channel Members

                                   Goals of the Logistics System

                         Selection of Distribution Channels Determined by:

Organizational goles - Objectives (same day delivery), resources and capabilities. Companies with
wide product mixes can sell more directly to the retailers, have more promotional skills etc

Market Characteristics - Geography, greater distance use more intermediaries, market density,
clustering, market size etc., industrial vs. consumer, Buyer Behavior, Where?/How?/ May need
creativity 

Product Attributes - IE Need to provide a service. Perishability-short channels, storage
requirements, space, fashion, size (reduce handling), complexity, standard.

Environmental Forces - IE Competition, Technology