Professional Documents
Culture Documents
Chapter 6
Chapter 6
Channel Design:
Retailers
Firms Wholesalers
• Producers,
manufacturers, service • Look up the
providers, franchisors • Look both up and channel
down to secure
• Look down the the channel suppliers
channel
toward the market
Objective 3:
6
Channel Design Paradigm
1.1. Recognize
Recognizethe
theneed
needfor
for
channeldesign
channel designdecision
decision
7.7.Select
Select 2.2.Set
Set&&coordinate
coordinate
channelmembers
channel members distributionobjectives
distribution objectives
6.6.Choose
Choosethe
the“best”
“best” 3.3.Specify
Specify
channelstructure
channel structure distributiontasks
distribution tasks
5.5.Evaluate
Evaluate
4.4.Develop
Developalternative
alternative
relevantvariables
relevant variables channelstructures
structures
channel
Objective 4:
When to Make a Channel 6
Design Decision
•• Developing
Developingaanew newproduct
productoror •• Dealing
Dealingwith
withchanges
changesinin
productline
line availabilityofofparticular
availability particularkinds
kindsofof
product
intermediaries
intermediaries
•• Aiming
Aimingan anexisting
existingproduct
productatataa
newmarket
new market •• Opening
Openingup upnew
newgeographic
geographic
marketingareas
marketing areas
•• Making
Makingaamajormajorchange
changeininsome
some
othercomponent
other componentofofthe the •• Facing
Facingthetheoccurrence
occurrenceofofmajor
major
marketingmix mix environmentalchanges
environmental changes
marketing
•• Establishing
Establishingaanew newfirm
firm •• Meeting
Meetingthe thechallenge
challengeofofconflict
conflict
•• Adapting
Adaptingtotochanging
changing ororother
otherbehavioral
behavioralproblems
problems
intermediarypolicies
intermediary policiesthat
thatmay
may •• Reviewing
Reviewingand andevaluating
evaluating
inhibitattainment
inhibit attainmentofofdistribution
distribution
objectives
objectives
Objective 5: 6
Distribution Objectives
Firm’s
Firm’s
overall
overall
objectives
objectives
&&
strategies
strategies
General
General
marketing
marketing
objectives&&
objectives
strategies
strategies
Product
Product Pricing
Pricing Promotion
Promotion Distribution
Distribution
marketing
marketing marketing
marketing marketing
marketing marketing
marketing
objectives&&
objectives objectives&&
objectives objectives&&
objectives objectives&&
objectives
strategies
strategies strategies
strategies strategies
strategies strategies
strategies
Objective 6: 6
Distribution Tasks
1. Number of
levels in the channel
2. Intensity at the
various levels
Allocation Alternatives
3. Types of
intermediaries
at each level
6
Number of Levels
Intensity Dimension
• Numerous types
• Manager’s emphasis on types of distribution tasks
performed by these intermediaries
• Watch emerging types
– Electronic online auction firms (eBay)
– Industrial products sold in B2B markets
(Chemdex, Converge.com)
Objective 8: 6
Categories of Variables
1. Market Variables
2. Product Variables
3. Company Variables
4. Intermediary Variables
5. Environmental Variables
6. Behavioral Variables
Market Variables 6
Economic Competitive
Sociocultural
Technological Legal
6
Behavioral Variables
Benefit Limitation
IF Management’s ability to
make sharp judgments is high