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This 33 page Class Notes was uploaded by Retta Stark on Thursday October 22, 2015. The Class Notes belongs to MAR 3023 at University of Central Florida taught by Staff in Fall. Since its upload, it has received 26 views. For similar materials see /class/227493/mar-3023-university-of-central-florida in Marketing at University of Central Florida.
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Date Created: 10/22/15
MAR 3 023 PRINCIPLES OF MARKETING Dr J aishankar Ganesh BA2 308G Marketing Channels amp Retailing November 03 amp 05 2003 Marketing Channels A set of interdependent organizations Marketing that ease the transfer of ownership as Channel products move from producer to business user or consumer The connected chain of all the business Supply entities both internal and external to Chain the company that perform or support the logistics function Marketing Channel Functions Specialization and Division of Labor Channels Fulfill Three Important Func ons Efficiency Providing Contact Specialization and Division of Labor Provides ef ciency and cost savings Attains economies of scale Aids producers who lack resources to market directly Builds good relationships with customers Overcoming Discrepancies The difference between the D39scrgrancy amount of product produced and the amount an end user Quant39ty wants to buy The lack of all the items a D39scrggancy customer needs to receive full satisfaction from a product or Assortment producta Overcoming Discrepancies A situation that occurs when a product is produced but a customer is not ready to buy it Temporal Discrepancy The difference between the Spatial location of a producer and the Discrepancy location of widely scattered markets Contact Ef ciency 4 consumer 9 Innsaciions rmediarv 5 producers n With an int Channel Intermediaries A channel intermediary that Retaller sells mainly to customers An institution that buys goods Merchant from manufacturers takes title Wholesaler to goods stores them and resells and ships them Wholesaling intermediaries who AgBentks and facilitate the sale of a product by m ers representing channel member Channel Intermediaries Tam T mgggpy Merchant Wholesalers Take Title to Goods I A96nts 7 B1r0kers Factors Suggesting Type of Wholesaling Intermediary to Use Factor Merchant Wholesalers Agenls or Brokers Nature of Product Standard Nonstandard custom Technicality of Product Complex Simple Prodqu Gross Margin High Low Frequency of Ordering Frequent Infrequent Trme between Order and Buyer desires shorter Buyer satis ed with long Receipt of Shipment lead time iead time Number of Customers Many Few Concentration of Customers Dispersed Concentrated Channel Functions Performed by Intermediaries ContactingPromotion Trlgnsagtional Negotiating unc Ions Risk Taking Physically distributing i fi i 0 mg Facilitating l Researching Func on Financing Channels for Consumer Products Direct Retailer Wholesaler AgentBroker Channel Channel Channel Channel Fl ex jhyleem r A 39 F O Agents or Brokers O Wholesalers Wholesalers Channels for BusinesstoBusiness Products Direct Direct Industrial A gentBroker A gentBroker Channel Channel Distributor Channel Industrial Channel Agerits or Agerits or Brokers Brokers Industrial Industrial Distributor Distributor BusinesstoBusiness Exchanges 0n the Internet Linking buyers and sellers 0 Dropping the middleman from the supply chain Creating private exchanges to automate the supply chain Alternative Channel Arrangements Nontraditional Channels Alliances Strategic Channel Supply Chain Management A management system that coordinates and integrates all of the activities performed by supply chain members into a seamless process from the source to the point of consumption Role of Supply Chain Management Communicator of customer demand from point of sale to supplier Physical flow process that engineers the movement of goods Bene ts of Supply Chain Management Greater Supply Chain Flexibility Improved Customer Service Higher Revenues Channel Strategy Decisions Factors Affecting Channel Choice Levelof Distribution Intensity Market Factors I I Intensive Distribution I Ii Distribution I 2 Market Factors Consumer or Industrial Customer Market Factors Size M Market That Affect Channel ChOICeS Geographic Location Product Factors Product Price I P tL39f 39 C I Product Fa reduc I e yce I That Affect Channel Choices Product Delicacy I Producer Factors Number of Product Lines Producer Factors Th tAff t cahanan Desire for Channel Control Choices Levels of Distribution Intensity Number of IntenSIty Level Objective I Achieve mass market Intens39Ve selling Many Convenience goods Work with selected intermediaries seleCt Ve Shopping and some specialty goods Several Work with single ntermediary Specialty One goods and industrial equipment Exclusive Managing Channel Relationships Social Dimensions of Channels 0 Channel Power 0 Channel Leadership Channel Power Control and Leadership Channel A channelmember s capacityto Power control or Influence the behaVIor of other channel members A situation that occurs when one Channel marketing channel member Control intentionally affects another member s behavior Channel A member of a marlfeting channel Leader that exercIses authoritypower over the actIVItIes of other members Channel Con ict gt A clash of goals and methods between distribution channel members Horizontal Occurs among channel members Conflict on the same level Vertical Occurs among channel members Conflict at different levels Channel Partnering The joint effort of all channel members to create a supply chain that serves customers and creates a competitive advantage T ransaction vs PartnershipBased Firms T ransactz onBased PartnershipBased Supplier Shortterm Longterm Mangfacmler Adversarial Cooperative Relatlonsmps Independent Dependent Price important Valueadded services Number of Many Few Suppliers Information Minimal High Sharing Investment Minimal High Required Production Scheduling Push I Pull Strategy Push Pull Start of CustomerOrder Production Inventory39Based Based Manufacturing Mass Production Mass Customization JustinTime Manufacturing A process that rede nes and simpli es manufacturing by reducing inventory levels and delivering raw materials just when they are needed on the production line Bene ts of J T Reduces raW material inventories Shortens lead times Creates better supplier relationships Reduces production and storeroom costs Reduces paperwork Electronic Data Interchange Information technology that replaces paper documents that accompany business transactions Inventory Control System A method of developing and maintaining an adequate assortment of materials or products to meet a manufacturer s or a customer s demand
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