ISU MKT 451 - Target Markets and Channel Design

Unformatted text preview:

Chapter 8Major Topics for Ch. 8Market VariablesFramework for Market Analysis*1. Market GeographyLocating MarketsTracking Changes in Market GeographyBeyond Market Geography*2. Market Size3. Market DensityMarket Density & Channel StrategySlide 124. Market Behavior*When the Market BuysWhere the Market BuysHow the Market BuysWho BuysConcept of Buying Centers: B2B SectorWhat the Market BuysChanges in Market BehaviorImplications of ChangesImplications of ChangeSlide 23Slide 24Different Types of Channel Competition**Channel Competition and Channel Structure*Chapter 8Chapter 8Target Markets and Channel Design88Major Topics for Ch. 81.Framework for (Target) Market Analysis- Effect of Each Market Variable on Channel Structure- Positioning and Channel Design2. Channel Competition and Channel Structure*Market VariablesMarket Variables 88The target market’s needs and wants should drive the manner in which the channel manager shapes the design of the firm’s marketing channels.88Framework for Market Analysis*Framework for Market Analysis*1. Market geography3. Market density2. Market sizeTargetMarkets4. Market Behavior*881. Market Geography1. Market Geographyrefers to the geographicalextent of markets and where they are located.Channel manager’s task:To evaluate market geography relative to channel structure to ensure that the structure is able to serve the marketseffectively and efficiently.Channel manager’s task:To evaluate market geography relative to channel structure to ensure that the structure is able to serve the marketseffectively and efficiently. Influence Level and Ownership of Channel Structure88Locating MarketsLocating MarketsDelineates geographicallocations of target markets by using acombination of the following:1. The Bureau of Censusdata for geographical entities such as states, regions/divisions, counties,metropolitan statistical areas, towns &townships (www.census.gov/)2. Postal ZIP codes1. The Bureau of Censusdata for geographical entities such as states, regions/divisions, counties,metropolitan statistical areas, towns &townships (www.census.gov/)2. Postal ZIP codes88Tracking Changes in Market GeographyTracking Changes in Market Geography•A high degree of mobility within the U.S. means that market geography changes frequently.•Asian countries & former Eastern bloc countries of central & eastern Europe have become key locations of emerging markets.In the U.S. In the U.S. Globally Globally88Beyond Market Geography*Beyond Market Geography*Channel managers must also grasp changes in:-Demography-Psychography (Consumer)-Benefit SoughtChannel managers must also grasp changes in:-Demography-Psychography (Consumer)-Benefit Sought882. Market Size2. Market Sizerefers to the number of buyers or “potential” buyers (consumer or industrial) in a given market.Channel manager’s task:Consider the peculiarities of particular situations and other relevant variables.== > Influence Intensity, Ownership, LevelEx) Foreign market (Hindustan Lever in India)Channel manager’s task:Consider the peculiarities of particular situations and other relevant variables.== > Influence Intensity, Ownership, LevelEx) Foreign market (Hindustan Lever in India)883. Market Density3. Market DensityMarket density refers to the number ofbuyers or potential buyers per unit ofgeographical area.This market dimension’srelationship to channel structureis illustrated in the concept of efficient congestion. This market dimension’srelationship to channel structureis illustrated in the concept of efficient congestion.Market Density & Channel StrategyMarket Density & Channel Strategy88Efficient congestionCongested (high-density) markets can promote efficiency in the performance of several basic distribution tasks, particularly those of transportation,storage, communication, andnegotiation. Influence Intensity, ownership, and level88Market Density & Channel StrategyMarket Density & Channel StrategyStrategicImplicationThe opportunity to achieve ahigh level of customer access at low cost is higher in dense marketsthan in more dispersed ones.==Manufacturers of a wide array of products seek out distributors and retailers that operate in dense markets.884. Market Behavior*4. Market Behavior*consists of five sub-dimensions:1. When the market buys2. Where the market buys3. How the market buys4. Who buys5. What the market buys*1. When the market buys2. Where the market buys3. How the market buys4. Who buys5. What the market buys*88WhenWhen the Market Buys the Market Buys Seasonally DailyWeeklyVariations occur:Implications for the channel manager:1. Variations create peaks & valleys in the manufacturer’s production schedule.2. Need to select channel members who are in tune with these changing patterns. Influence Intensity decision88WhereWhere the Market Buys the Market BuysDetermined by:1. The types of outlets from which final buyers choose to make their purchases2. The location of those outletsImplications for the channel manager:1. Need to know where customers generally buy particular types of products2. Need to know whether these patterns may be changing. Influence Type of Intermediaries88How How the Market Buysthe Market Buys1. Large quantities 2. Self-service3. One-stop shopping4. Impulse buying5. Cash6. Shopping at home7. Expending substantial effort through comparison shopping8. Demanding extensive service1. Small quantities2. Assistance by salespeople3. Buying from several stores4. Extensive decision making prior to purchase5. Credit6. Shopping at stores7. Expending little effort8. Demanding little serviceVersus88WhoWho Buys BuysWho makes the physical purchase?Who makes the physical purchase?Affects the type of retailers chosen in the consumer marketMay influence the kinds of channel members used to serve industrial marketsWho decides to make the purchase?Who decides to make the purchase?In context of family unit at consumer levelBuying centers atindustrial levelConcept of Buying Centers: Concept of Buying Centers: B2B SectorB2B Sector88UsersInfluencersDecidersApproversBuyersGatekeepersUsersInfluencersDecidersApproversBuyersGatekeepersSets of people who participate in industrialbuying decisions and who are responsible for the consequences resulting from the decisionWhat the Market Buys88•Product Performance•Service (before and after) and maintenance•Total SolutionImplication for Ownership/function and Length of Channel StructureEx) Partial


View Full Document

ISU MKT 451 - Target Markets and Channel Design

Download Target Markets and Channel Design
Our administrator received your request to download this document. We will send you the file to your email shortly.
Loading Unlocking...
Login

Join to view Target Markets and Channel Design and access 3M+ class-specific study document.

or
We will never post anything without your permission.
Don't have an account?
Sign Up

Join to view Target Markets and Channel Design 2 2 and access 3M+ class-specific study document.

or

By creating an account you agree to our Privacy Policy and Terms Of Use

Already a member?