Introduction to Marketing Chapter 10 – Flashcards
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Marketing channel (distribution channel)
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A set of interdependent organizations that help make a product or service available for use or consumption by the consumer or business user.
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Value delivery network
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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.
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Which of the following statements is true regarding marketing channels and channel​ intermediaries?
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Using marketing channel intermediaries means producers give up some control over how and to whom they sell their products.
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When assigning functions to channel​ members, it is important for producers to​ ________.
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assign functions to the channel members that can add the most value for the cost
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A​ ________ consists of​ producers, wholesalers, and retailers acting as a unified system.
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vertical marketing system The three major types of VMSs are corporate​ VMSs, contractual​ VMSs, and administered VMSs.
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Channel level
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A layer of intermediaries that performs some work in bringing the product and its ownership closer to the final buyer.
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Direct marketing channel
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A marketing channel that has no intermediary levels.
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Indirect marketing channel
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A marketing channel containing one or more intermediary levels.
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Horizontal marketing system
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A channel arrangement in which two or more companies at one level join together to follow a new marketing opportunity.
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Multichannel distribution system
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A distribution system in which a single firm sets up two or more marketing channels to reach one or more customer segments.
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Which of the following statements is true regarding channel​ organization?
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Channel members are dependent on each other for the overall success of the channel.
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What are the four steps to designing marketing channels in their correct​ order?
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Analyzing consumer​ needs, setting channel​ objectives, identifying major channel​ alternatives, and evaluating the alternatives.
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When designing marketing​ channels, companies must determine the number of channel members to use at each level. The three strategies that are available to do this are​ ________ distribution.
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​intensive, selective, and exclusive
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Which of the following statements is true regarding the selection of qualified channel​ members?
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Producers vary in their ability to attract qualified marketing intermediaries.
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Most companies today see their intermediaries as​ first-line customers and focus on​ ________ to forge​ long-term relationships with channel members.
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partner relationship management
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What are the four major functions of marketing​ logistics?
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​Warehousing, inventory​ management, transportation, and logistics information management
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Which of the following statements regarding marketing logistics is​ true?
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Marketing logistics involve inbound​ logistics, outbound​ logistics, and reverse logistics.
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Marketing logistics (physical distribution)
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Planning, implementing, and controlling the physical flow of goods, services, and related information from points of origin to points of consumption to meet customer requirements at a profit.
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Upstream Partners
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Raw Material Suppliers Finances
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Downstream Partners
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Distribution Retailers Customers
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Channel Length
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number of intermediary levels
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Indirect Marketing Channels
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contain 1 or more intermediary levels
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Channel Conflict
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Disagreements among marketing channel members on goals, roles, and rewards
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Horizontal Conflict
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occurs among firms at the same level of the channel. Ex: walmart, target
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Vertical Conflict
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occurs between different levels of the same channel. Ex: Sony, bestbuy
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Brands typically go through three phases of managing vertical sales channel conflict:
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Avoid Conflict Manage Conflict Reconcile Conflict
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Conventional distribution channel
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1+ independent producers, wholesalers, and retailers • Each member is a separate business seeking to maximize its own profits even at the expense of profits for the system as a whole.
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Horizontal Marketing System
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Two or more companies at one level join together to follow a new marketing opportunity
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Disintermediation
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Occurs when product or service producers cut out marketing channel intermediaries or when radically new types of channel intermediaries displace traditional ones
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Intensive Distribution
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Stock product in as many outlets as possible. Ex: Coke
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Exclusive Distribution
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Very limited number of dealers with exclusive right to distribute in their territories. Ex: Only at Macys
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Selective Distribution
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More than one, but less than all, carry the product. Ex:
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Retailing
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Activities involved in selling goods or services directly to consumers for their personal use
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Shopper marketing
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Using in-store promotions and advertising to extend brand equity to "the last mile" Encourages favorable point-of-purchase decisions
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Amount of Service Offered (Retailer)
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Self-Service Retailers: Customers locate-compare-select to save time or money. (Walmart) Limited Service Retailers: Carry more shopping goods that require some sales assistance. Higher prices due to higher operating costs. (JC Penny) Full-Service Retailers: Carry more specialty goods that require high-touch sales assistance. Higher prices due to much higher operating costs (Nordstrom)
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Product Line Breadth & Depth (Retailer)
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Specialty Stores: Narrow product lines; deep assortment within those lines (Destination Maternity) Department Stores: Wide variety of product lines (JC Penny) Supermarkets: Large, low-cost, low-margin, high-volume self-service store that carries wide range of food and household products (Shoprite) Convenience Stores: Small stores, limited line of high turnover convenience goods (Wawa) Superstores: Very large store for routinely purchased items (Walmart)
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Category Killers
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A giant specialty store that carries a very deep assortment of a narrow product line Ex: Party City, Pet Smart
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Retailers decide:
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- Product assortment: be different vs. competitors - Services mix: Offer unique services - Store atmosphere: Create a unique store experience (ex: experiential retailing)
