Distribution Channel Decisions

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As consumers, we generally take for granted the role of marketing intermediaries or channel members. If we want a six-pack of soda or a box of detergent, we can buy it at a supermarket, a convenience store, or even a drugstore. Manufacturers understand the value and importance of these intermediaries.

One of a marketer's most important marketing decisions involves the way it makes its products and services available for purchase. A firm can have an excellent product at a great price, but it will be of little value unless it is available where the customer wants it, when the customer wants it, and with the proper support and service. Marketing channels, the place element of the marketing mix, are "sets of interdependent organizations involved in the process of making a product or service available for use or consumption."20

Channel decisions involve selecting, managing, and motivating intermediaries such as wholesalers, distributors, brokers, and retailers that help a firm make a product or service available to customers. These intermediaries, sometimes called resellers, are critical to the success of a company's marketing program.

The distribution strategy should also take into consideration the communication objectives and the impact that the channel strategy will have on the IMC program. Stewart and colleagues discuss the need for "integrated channel management," which "reflects the blurring of the boundaries of the communications and distribution func-tions."21 Consistent with the product and pricing decisions, where the product is distributed will send a communications message. Does the fact that a product is sold at Neiman Marcus or Saks convey a different message regarding its image than if it were distributed at Kmart or Wal-Mart? If you think about it for a moment, the mere fact that the product is distributed in these channels communicates an image about it in your mind. (Think about the Samsung discussion at the beginning of this chapter.) Stewart gives examples of how channel elements contribute to communication—for example, grocery store displays, point-of-purchase merchandising, and shelf footage. The distribution channel in a well-integrated marketing program serves as a form of reminder advertising. The consumer sees the brand name and recalls the advertising. (Think about the last time you passed a McDonald's. Did it remind you of any of McDonald's ads?)

A company can choose not to use any channel intermediaries but, rather, to sell to its customers through direct channels. This type of channel arrangement is sometimes used in the consumer market by firms using direct-selling programs, such as Avon, Tupperware, and Mary Kay, or firms that use direct-response advertising or telemarketing to sell their products. Direct channels are also frequently used by manufacturers of industrial products and services, which are often selling expensive and complex products that require extensive negotiations and sales efforts, as well as service and follow-up calls after the sale. The ad for Titleist putters shown earlier reflects the higher cost and quality associated with the brand.

Chapter 15 provides a discussion of the role of the Internet in an IMC program. As will be seen, the Internet is relied upon by many companies as a direct channel of distribution, since they offer products and services for sale on their websites. Amazon.com and Barnes&Noble.com are just two of the many examples of such efforts.

Most consumer-product companies distribute through indirect channels, usually using a network of wholesalers (institutions that sell to other resellers) and/or retailers (which sell primarily to the final consumer).

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Responses

  • adonay
    Which distribution channel is used by companies such as avon and tupperware?
    7 years ago
  • nadine
    What is marketing communication through distribution channel?
    7 years ago
  • may
    What are marketing communication distribution channels?
    7 years ago
  • Hana Davidson
    Which distribution channnel is used by companies such as avon ?
    4 years ago
  • marco
    Why are distribution channel decisions such importance to companies?
    3 years ago
  • giuliana
    Which distribution channel is used by companies such as avon and shaklee?
    3 years ago
  • Barbara Gerste
    What is channel decision?
    2 years ago
  • abel
    What is distribution channel decision?
    2 years ago
  • TORSTEN
    What are channels of decisions?
    1 year ago

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