channels of distribution

Examples of channels of distribution in the following topics:

• The Significance of Marketing Channels

  • The primary purpose of any channel of distribution is to bridge the gap between the producer of a product and its user.
  • The primary purpose of any channel of distribution is to bridge the gap between the producer of a product and the user of it, whether the parties are located in the same community or in different countries thousands of miles apart.
  • The channel of distribution is defined as the most efficient and effective manner in which to place a product into the hands of the customer.
  • Finally, although the notion of a channel of distribution may sound unlikely for a service product (such as health care or air travel), service marketers also face the problem of delivering their product in the form and at the place and time demanded by the customer.
  • Even performing arts employ distribution channels.

• Channels for Industrial Goods

  • A channel for industrial goods is a set of interdependent organizations in the process of making products/services available for use.
  • With the growth of specialization, particularly industrial specialization, and with improvements in methods of transportation and communication, channels of distribution became very complex.
  • This definition implies several important characteristics of the channel.
  • First, the channel consists of institutions, some under the control of the producer and some outside the producer's control.
  • This channel of distribution is commonly used to market accessory equipment, such as typewriters or operating supplies which include typewriting papers, pens, and office materials.

• Customer Expectations

  • Members of a channel of a distribution are also customers of those elsewhere in the channel, and their expectations must also be met.
  • It is important to remember that a channel of distribution may be made up of organizations, but those organizations are made up of people.
  • Ideally, a channel member should coordinate their efforts with other members in such a way that the performance of the total distribution system is enhanced.
  • By ensuring there are no leadership issues and by tackling the human element of the channel of distribution, expectations of the channel members can be effectively met.
  • This distributor is a part of a channel of distribution, who must both meet expectations of its customers, as well as have its own expectations met.

• Channels for Consumer Goods

  • Marketing channels are sets of interdependent organizations involved in making a product or service available for use or consumption.
  • With the growth of specialization, particularly industrial specialization, and with improvements in methods of transportation and communication, channels of distribution have become very complex.
  • First, the channel consists of institutions, some under the control of the producer and some outside the producer's control.
  • Finally, channels should have certain distribution objectives guiding their activities.
  • The structure and management of the marketing channel is thus in part a function of a firm's distribution objective.

• Channel Member Characteristics

  • Thus, the channel chosen by a marketer becomes an integral part of the marketing plan.
  • There are many types of channels, and the selected channel becomes a function of the overall marketing strategy.
  • It is important for a company to match its products with the characteristics of the distribution channel.
  • Carefully considering the possible distribution channels will help maximize the potential of a product.
  • Explain the importance of pairing a brand's products with the appropriate distribution channel

• Types of Marketing Channels

  • There are basically 4 types of marketing channels: direct selling; selling through intermediaries; dual distribution; and reverse channels.
  • Dual distribution describes a wide variety of marketing arrangements by which the manufacturer or wholesalers uses more than one channel simultaneously to reach the end user.
  • Using two or more channels to attract the same target market can sometimes lead to channel conflict.
  • An example of dual distribution is business format franchising, where the franchisors, license the operation of some of its units to franchisees while simultaneously owning and operating some units themselves.
  • There is another distinction between reverse channels and the more traditional ones -- the introduction of a beneficiary.

• Selecting Marketing Channels

  • In intensive distribution (such as candy) the manufacturer attempts to get as many intermediaries of a particular type as possible to carry the product
  • The type of product dictates the number of marketing channels to use.
  • Once the number of levels is decided, the channel manager must determine the actual number of channel components involved at each level.
  • How many retailers and wholesalers in a particular market should be included in the distribution network?
  • The objective is to gather enough information to have a general understanding of the distribution tasks these intermediaries perform.

• Competitive Priorities in Marketing Channels

  • A marketing channel is a set of practices necessary to transfer the ownership of goods from producer to consumer.
  • This process typically consists of all the institutions and marketing activities involved in the promotion and distribution of goods.
  • The Impact the attitudes of channel intermediaries have on the product
  • An alternative term is distribution channel or 'route-to-market'.
  • Intensive distribution - this channel allows the producer's products to be stocked in major, mainstream outlets.

• Factors Affecting Channel Choice

  • Other channel members can be useful to the producer in designing the product, packaging it, pricing it, promoting it, and distributing it through the most effective channels.
  • Achieve a pattern of distribution - structure the channel in order to achieve certain time, place, and form utilities.
  • After the distribution objectives are set, it is appropriate to determine the specific distribution tasks or functions to be performed in that channel system.
  • An ability to do this requires the channel manager to evaluate all phases of the distribution network.
  • Managers have many factors to consider when choosing a product distribution channel.

• Distribution and logistics

  • Distribution channels are the means by which goods are distributed from the manufacturer to the end user.
  • Logistics, or physical distribution management, is concerned with the planning, implementing, and control of physical flows of materials and final goods from points of origin to points of use to meet customer needs at a profit.
  • The first link is the seller's headquarters organization, which is responsible for supervising the channel, and acts as part of the channel itself.
  • Channels between countries represent the second link.
  • Finally, the third link is the channel structure (logistics) within countries, which distributes the products from their point of entry to the final consumer.