MKT 327 Introduction to Marketing 1st Edition Lecture 21 Channel distribution Outline of Last Lecture A. Essence of marketing I. Physical connection II. Marketing channels III. Importance of channels IV. Coordinating marketing mix/ managing channelV. Market discrepanciesVI. Universal marketing functionsVII. Channel decisions VIII. Channel criteria Outline of Current Lecture B. Channel intensityIX. Distribution intensity/ coverage guidelinesX. Distribution XI. Channel member selectionXII. WholesalingXIII. Channel member selection decision frameworkXIV. WholesalersXV. Brokers agentsXVI. RetailersXVII. Channel member selection decision framework continuedXVIII. Channel management issuesCurrent Lecture1) Channel intensitya) Refers to the number of locations (not channels) through which a company sells its products in a given market area (relative to all possible locations for that product)i) Impacts coverage2) Distribution intensity/ coverage guidelinesa) Intensive distribution- convenience goodsi) Competitors: intensive or selective no conflict with core distributorsThese notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.b) Selective distribution- shopping goodsi) Competitors: selective or exclusive no conflict with core distributorsc) Exclusive distribution- specialty goods i) Competitors: exclusive no conflict with core distributors3) Distributiona) Has very targeted market with a specialty soft drinkb) High conflict (obstacles in getting into traditional outlets)i) Distribution of Jones Soda began with what we call our “alternative distribution strategy.” Jones Soda Co. placed it’s own coolers, bearing their signature flames, in some truly unique venues, such as skate, surf, and snowboarding shops, tattoo or piercing parlors, as well as in individual fashion stores and national retail clothing and music stores.ii) Following the execution of the alternative distribution strategy, Jones began an up and down the street (attack) of the marketplace; this time placing product in convenience and food storesiii) Finally, the company has now began to achieve larger chain store listing with companies such as Starbucks, Safeway, etc. 4) Channel member selectiona) Addresses the type of intermediaries of a particular distribution channel; based on which universal marketing functions need to be performed outside organization and what services, costs, and images provided to consumers. b) Impacts costs and competencies5) Wholesaling a) The activities involved in executing universal marketing functions and selling goods for resale to retailers and other businessesb) Impact on value creationi) Universal marketing functions(1) Time(2) Place(3) Possession 6) Channel member selection decision frameworka) Alternativesi) Merchant(1) Full service(2) Limited serviceii) Broker/agentiii) Manufacturer’s Repb) Decision criteria i) Universal marketing functions(1) Customer priorities(2) Market efficiencies(3) Market effectivenessii) Competitive advantages (1) Product line/mix7) Wholesalersa) Take title to goods8) Brokers agents9) Retailers a) The activities involved in assorting and allocating products or services to sell them directly to end users for personal or institutional usei) Impact on value creation(1) Assortment function(a) Time/place(2) Create value(a) Form(i) Services(3) Allocation function(a) Time/place10) Channel member selection decision framework continued a) Alternative i) Storeii) Direct marketingiii) Internetb) Decision criteriai) Services and function(1) Costs (2) Positioning/image(3) Allocation and assortment(4) Channel structure11) Channel management issuesa) RELATIONSHIPS b) Strategy executionc) Addresses the exact type and nature of relationships between the marketer’s organization and the members of distribution channel, and how that relationship is usedto help execute the marketing tactical plani) Impacts conflict and