MKTG 409 1nd Edition Exam 3 Study Guide Lectures 14 19 Lecture 14 March 6 Chapter 15 Marketing Channels and Supply Chain supply chain management A set of approaches used to integrate the functions of operations management logistics management supply management and marketing channel management so products are produced and distributed in the right quantities to the right locations and at the right time supply chain All the activities associated with the flow and transformation of products from raw materials through to the end customer supply management In its broadest form refers to the processes that enable the progress of value from raw material to final customer and back to redesign and final disposition operations management The total set of managerial activities used by an organization to transform resource inputs into products services or both logistics management Planning implementing and controlling the efficient and effective flow and storage of products and information from the point of origin to consumption to meet customers needs and wants Channel management All activities related to selling service and the development of longterm customer relationship Technology has increased speed flexibility and cooperation It has improved service by increasing number of innovative goods and increased involvement in supply chain Marketing Channel A group of individuals and organizations that direct the flow of products from producers to customers within the supply chain determine a product s market presence and buyers accessibility to the product Create Time place possession and form utility A channel can include the producer agents optional wholesalers optional retailers optional and consumers optional Strategic issues include competitive priorities channel integration channel leadership and coordination Channel Cooperation Enables retailers to speed up inventory replenishment improve customer service and cut costs of bringing products to customers Conflict occurs when self interest creates misunderstanding and communication is poor between channel members private warehouses Company operated facilities for storing and shipping products public warehouses Storage space and related physical distribution facilities that can be leased by companies materials handling Physical handling of tangible goods supplies and resources megacarriers Freight transportation firms that provide several modes of shipment tying agreement An agreement in which a supplier furnishes a product to a channel member with the stipulation that the channel member must purchase other products as well Industrial Distributor An independent business that takes title to products and carries inventories Manufacturers Agent An independent businessperson who sells complementary products and is compensated by commissions Distribution centers Large centralized warehouses that focus on moving rather than storing goods selective distribution Using only some available outlets in an area to distribute a product Marketing Intermediary Middleman link producers to other intermediaries or ultimate consumers through contractual arrangement or through the purchase and reselling of products Activates include Marketing information marketing management facilitating exchange promotion price physical distribution Make the buying process more efficient middleman does not always equal more cost Marketing Channel Selection Customer characteristics product attributes type of organization competition marketing environmental forces and characteristics of intermediaries Intensive Market Coverage Convenience products Selective Market Coverage Shopping Products Exclusive Market Coverage Specialty products channel captain The dominant leader of a marketing channel or a supply channel channel power The ability of one channel member to influence another member s goal achievement vertical channel integration Combining two or more stages of the marketing channel under one management vertical marketing system VMS A marketing channel managed by a single channel member to achieve efficient low cost distribution aimed at satisfying target market customers horizontal channel integration Combining organizations at the same level of operation under one management physical distribution Activities used to move products from producers to consumers and other end users Functions include customer service administration transportation Most Expensive warehouse and inventory carrying order processing The receipt and transmission of sales order information Stockouts Shortages of products that can result in loss of customers Reorder Point The inventory level that signals the need to place a new order Order Lead Time The average time lapse between placing the order and receiving it Usage Rate The rate at which inventory is used sold Safety Stock The extra inventory a firm keeps just in time JIT An inventory management approach in which supplies arrive just when needed for production or resale materials handling Physical handling of tangible goods supplies and resources Legal Issues Dual Distribution Restricted sales exclusive dealing tying agreements refusal to deal Lecture 15 March 18 Chapter 14 Branding and Packaging Brand A name term design symbol or other feature that identifies one seller s product as distinct from those of other sellers Value to buyers includes identification reduction of purchase time provides a form of self expression helps evaluate Quality Reduces perceived risk in purchase offers potential psychological reward Value to sellers include Identification Makes repeat purchasing easer assists in new product introduction and promotional efforts fosters brand loyalty and increases profitability Products must protect their brand name because they may loose it Can do this with a strong brand name and legal registration brand mark The part of a brand that is not made up of words such as a symbol or design brand name The part of a brand that can be spoken including letters words and numbers trade name The full legal name of an organization trademark A legal designation of exclusive use of a brand brand equity The marketing and financial value associated with a brand s strength in a market Includes brand name awareness perceived brand quality brand associations and brand loyalty The worlds most valueable brand is Coca cola brand loyalty A customer s favorable attitude toward a specific brand Levels of Brand Loyalty include Recognition awareness preference