Channel 6h3d1x

Effective Working with Channel By- Group-5

Objectives  What

is channel and who are the channel ?  Why companies use distribution channels and understand the functions that these channels perform.  How Channels can be used effectively.  Learn how channel interact and how they organize to perform the work of the channel.  How companies select, motivate,

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What Channel is ? 



Distribution (or place) is one of the four elements of marketing mix. An organization or set of organizations (go-betweens) involved in the process of making a product or service available for use or consumption by a consumer or business . The other three parts of the marketing mix are product, pricing, and promotion. Chain of intermediaries, each ing the product down the chain to the next organization, before it finally reaches the consumer or end-. This process is known as the 'distribution chain' or the 'channel.' Each of the elements in these chains will have their own specific needs, which the producer must take into , along with those of the all-important end-.

Channel The network made up of the company, suppliers, distributors, and ultimately customers who “partner” with each other to improve the performance of the entire system.  Different of Channels : 1.Wholseller 2.Distributor 3.Retailer 4.Consumer 

Distribution channel 

A number of alternate 'channels' of distribution may be available: Distribution channels may not be restricted to physical products alone. They may be just as important for moving a service from producer to consumer in certain sectors, since both direct and indirect channels may be used. Hotels, for example, may sell their services (typically rooms) directly or through travel agents, tour operators, airlines, tourist boards, centralized reservation systems, etc.

Channel structure

Nature & Importance of Marketing Channels  Number

of Channel Levels

The number of intermediary levels indicates the length of a marketing channel. Direct Channels  Indirect Channels 

Producers lose more control and face greater channel complexity as additional channel levels are added.

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Nature & ImportancePerformed of Marketing Key Functions Channels

Channel

Information  Promotion   Matching

by



Negotiation  Physical Distribution  Financing  Risk taking 

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Channel Management Decisions  Selecting

Channel

 Identify

characteristics that distinguish the best channel

 Managing

 Partner

key

and Motivating Channel

relationship management (PRM) is

 Evaluating

Channel

 Performance

should be checked against

standards  Channel should be rewarded or

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Managerial concerns: Effective use of channel 

Channel hip.



Channel motivation.



Channel design.



Monitoring and Managing channels.

Channel hip 

Intensive distribution - Where the majority of resellers stock the 'product' (with convenience products, for example, and particularly the brand leaders in consumer goods markets) price competition may be evident.



Selective distribution - This is the normal pattern (in both consumer and industrial markets) where 'suitable' resellers stock the product.



Exclusive distribution - Only specially selected resellers or authorized dealers (typically only one per geographical area) are allowed to sell the 'product'.

Channel motivation. 

There are many devices for achieving such motivation. Perhaps the most usual is `incentive':



The supplier offers a better margin, to tempt the owners in the channel to push the product rather than its competitors; or a competition is offered to the distributors' sales personnel, so that they are tempted to push the product Different Forms of Incentive/Reward 1.Margin 2.Gifts 3.Tour Packages 4.Certificates



Channel Design Decisions  Step

1: Analyzing Consumer Needs

Cost and feasibility of meeting needs must be considered  Step

2: Setting Channel Objectives

Set channel objectives in of targeted level of customer service Many factors influence channel objectives 13

Channel Design Decisions  Step

3: Identifying Major Alternatives Types of intermediaries 

Company sales force, manufacturer’s agency, industrial distributors

Number of marketing intermediaries 

Intensive, selective, and exclusive distribution

Responsibilities of channel 14

Channel Design Decisions  Step

4: Evaluating Major Alternatives Economic criteria Control issues Adaptive criteria

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Channel Design Decisions  Deg

International Distribution

Channels Global marketers usually adapt their channel strategies to structures that exist within foreign countries Key challenges: May be complex or hard to penetrate  May be scattered, inefficient, or totally lacking 

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Monitoring and Managing channels. Organization's own sales and distribution activities need to be monitored and managed, so will those of the distribution chain.  In practice, many organizations use a mix of different channels; in particular, they may complement 1. Direct sales force, calling on the larger s. 2. Agents, covering the smaller customers and prospects. 

Monitoring Channels/Channel Once the Channel is in its place and started working, it needs to be monitored for effective working/ Optimum utilization.  Channel Monitoring Devices/Techniques. 1. Recording Sales Data from all channel . 2. Analyzing Performance of channel . 