Question

Please write an essay on marketing channels and provide relevant examples from your experiences or observation about the companies and businesses around ?

Answer 1

1.

Marketing channel are the set activities or practices that are essential to transfer goods from point of production to point of sale.Functions of marketing channel, A marketing channel is an important tool for the management to place their product in the market. A successful marketing channel performs following functions:

• Linking buyers to producers

• Perform functions like promotion, advertising and sales

• Influence pricing strategy of the organization

• Affecting product strategy through branding, policies and warehousing

• Customize profits

Hence were the functions of a marketing channel.

There are various types of marketing channel that organizations can opt from.

Selling directly to consumers Producer Consumer Selling through retailers Producer Retailer Consumer Selling through wholesalers Wholesaler Retailer Producer Consumer

Distribution channels

It is essential that the commodity (specialized ice cream) is made available to the customer in appropriate amounts, convenient locations and at times, when the consumer chooses to purchase them. It is therefore necessary not only to recognize and address customer needs but also to address marketing needs. The key reasons for reforming distribution networks are the following:

• Match demand with supply – Specialized ice-creams have been a family-run business until the TV host applauded it. After the show, orders started flooding in. It is imperative that all orders are attended and the increased demand of ice-cream is catered to. This is essential to maintain the brand name and respect of the brand created in the target market.

• Efficient management of channel – It is advisable to restructure the distribution channel to ensure efficient management of the channel. This will help reduce errors or deviations.

• Maintain quality – Controlled distribution channel will help ensure quality standards of specialized ice-cream and ensure long-term customer satisfaction.

• Increase revenue – Increased customer satisfaction will lead to higher profit margins and thus increased revenue for the business.

• Ensure adequate production facilities – Organized distribution channel will ensure availability of adequate production supplies, raw material, and facilities for the business. This will help reduce time delays or quality compromise.

• Enhanced customer support – Once the distribution channel is organized and implemented, business will be able to communicate with the customers for understanding satisfaction levels and modifications required in the product. This will further enhance business reputation in the market.

Abovementioned are the reasons that will help specialized ice-cream business to gain long-term benefits and competitive advantage in the market.

Marketing channel is nothing but the set of activities that transfer the good from the manufacturer to the consumer. This process include order completion, warehousing and delivery of products to the customer. Distribution channel consists of air, rail, truck and water transportation.

There are four types of marketing channels. They are: -

• Direct selling - Direct distribution involves distributing products directly from the manufacturer to the customer. This include one-on-one selling, internet sales, etc. The benefit of direct selling is that it is convenient for the customers and provide service benefits like demonstrating the product personally, home delivery, etc.
• Selling through intermediaries - . Indirect distribution involves distributing product through an intermediary from the manufacturer to the consumer. Wholesalers and retailers are intermediaries that make the product available to the customers.
• Dual distribution - This involves different marketing approaches that are used by wholesalers and manufacturer where more than one channel is used simultaneously to make the product available to the end users. Example - Format franchising.
• Reverse channel - This involves the flow of damaged goods from the customers to the supplier or manufacturer which can be recycled as raw material.

Current distribution models, including manufacturers , wholesalers and retailers and variations that cut one or two elements, which include marketing networks. For example, businesses like Dell and Avon discourage wholesalers and suppliers from selling to customers by having their own warehouses and distributors.

Channel is a tool used to transfer products from the manufacturer to the final client by retailers and other anticipated midwayers. An operator is considered a specialist/intermediary within the system. Channels typically range from 2-tier medium to 5-tier channels with 3 mediators. For example, in a two-layered market is a maker of calfskin bags that directly manufacture totes and markets them to customers.

Chicken and eggs are sold to a coffee maker who markets exclusive cafes on the four-level platform and handles customers at the time. In the distribution anchor, operators / middle people are used to advance transmission and provide ownership, installments and item information. Channel choices are, according to Philip Kotler, one of the most important choices management makes and can affect a particular marketing option directly. The associated organizations (mediators), who are involved in the usage or use of an object or administration for the client or business beneficiary, take these choices.

Direct Channel or Zero Level Channels

When the supplier does not market the products directly to the consumer instead of providing the representative, it is called Zero Level Network. Distribution networks, postal sales, online sales and purchases.

Indirect Channels

The process of appropriation is called indirect process, at which time a producer requires the assistance of one or more goers to transfer products from the production site to the point of use. Here are the main types:

One Level Channel

A delegate is used in this procedure. In this case a manufacturer markets the products directly to the seller instead of selling them to companies or wholesalers. This technique is used for luxury watches and other items. This technique is also useful when it comes to the selling of FMCG.

A Two Level Channe

There are two intermediate levels for a two-level system, one wholesaler and a store. A wholesaler typically purchases and invents massive measures of product from various manufacturers and then places parts in mass orders to send distributors smaller quantities. The activity of wholesalers is good for free companies with negligible capital and order volumes relating to revenue. This system appears to work better when the procurement market is crowded, as it is not controlled by a small number of large, dominant distributors who have a chance to dismiss the wholesaler. The Model Run is the food / alcohol deal in Europe and the United Kingdom.

Three Level Channel

Two levels are added as experts to this level . Two levels are added. An specialist advises the supplier and wholesaler to common separation. Many large companies, which cannot reach the wholesaler directly, obtain operators' assistance. These organizations assign and supply the material to their specialists in each region. At that point they sell the material to the distributors, the wholesaler to the retailer and finally the retailer offers it to the customers.