Chapter Fifteen
15
Distributing Products
Chapter 15 has 7 goals
1
Explain the concept of marketing channels and their value
5
Explain the various kinds of nonstore retailing
2
Demonstrate how intermediaries perform the 6 marketing utilities
6
Explain the various ways to build cooperation in channel systems
3
Identify the types of wholesale intermediaries
7
Describe logistics and outline how intermediaries manage the transportation and storage of goods
4
Compare the distribution strategies retailers use
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What is Marketing Intermediaries?
Marketing Intermediaries --.
LG 1 The Emergence of Marketing Intermediaries
Marketing Intermediaries -- Organizations that assist in moving goods and services from businesses to businesses (B2B) and from businesses to consumers (B2C).
They are called intermediaries because they’re in the middle of a series of firms that distribute goods.
LG 1 The Emergence of Marketing Intermediaries
Channel of Distribution
LG 1 The Emergence of Marketing Intermediaries
Channel of Distribution -- A group of marketing intermediaries that joining together to transport and store goods from producers to consumers.
LG 1 The Emergence of Marketing Intermediaries
Agents and Brokers
Wholesaler.
Retailer
LG 1 TYPES of MARKETING INTERMEDIARIES
Agents and Brokers
-- Intermediaries who bring buyers and sellers together and assist in negotiating an exchange but do not take title to the goods they offer.
LG 1 TYPES of MARKETING INTERMEDIARIES
Wholesaler -- An intermediary that sells products to other organizations (B2B) such as retailers, manufacturers, and hospitals.
LG 1 TYPES of MARKETING INTERMEDIARIES
Retailer -- An organization that sells products to customers.
LG 1 TYPES of MARKETING INTERMEDIARIES
Intermediaries perform marketing tasks faster and cheaper than most manufacturers could provide them.
Marketing intermediaries add costs to products but they’re generally offset by the values they provide.
LG 1 WHY MARKETING NEEDS INTERMEDIARIES
Utility – The value, that organizations add to goods and services by making them more useful or accessible to consumers.
Six types of utilities:
Form
Time
Place
Possession
Information
Service
LG 2 The Utilities Created by Intermediaries
INTERMEDIARIES CREATE UTILITY
Utility
Changes raw materials into useful products; producers generally provide form utility.
Lee transforms denim into clothes.
LG 2 The Utilities Created by Intermediaries
HOW MARKETERS USE UTILITY
Utility
Makes products available when customers want them.
Many KFC stores are open 24-hours a day.
Colleges offer day and evening classes.
LG 2 The Utilities Created by Intermediaries
HOW MARKETERS USE UTILITY
Utility
-- Adds value to products by placing them where people want them.
Banks place ATMs at convenient locations.
LG 2 The Utilities Created by Intermediaries
HOW MARKETERS USE UTILITY
Utility
-- Helps transfer ownership from one party to another, including providing credit.
Pay for lunch at McDonalds with your Visa card.
LG 2 The Utilities Created by Intermediaries
HOW MARKETERS USE UTILITY
5. Information Utility
-- Opens two-way flows of information between marketing participants.
Websites offers advice to buyers.
LG 2 The Utilities Created by Intermediaries
HOW MARKETERS USE UTILITY
6. Service Utility
-- Provides service during and after a sale and teaches customers how to best use products.
Apple offers classes to help computer buyers.
LG 2 The Utilities Created by Intermediaries
HOW MARKETERS USE UTILITY
What’s a channel of distribution?
What are marketing intermediaries?
Give examples of the utilities intermediaries create and how they provide them.
PROGRESS ASSESSMENT
Merchant Wholesalers -- Independently owned firms that take title to the goods they handle.
Wholesalers make B2B sales (resale).
LG 3 TYPES of WHOLESALE INTERMEDIARIES
Intensive Distribution.
Selective Distribution
Exclusive Distribution
LG 4 RETAIL DISTRIBUTION STRATEGIES
Intensive Distribution
-- Puts products into as many retail outlets as possible including vending machines.
LG 4 RETAIL DISTRIBUTION STRATEGIES
Selective Distribution
-- Uses only a preferred group of the available retailers in an area.
LG 4 RETAIL DISTRIBUTION STRATEGIES
Exclusive Distribution
-- The use of only one retail outlet in a given geographic area.
LG 4 RETAIL DISTRIBUTION STRATEGIES
What is
Intensive distribution strategy?
Selective distribution strategy?
Exclusive distribution strategy?
PROGRESS ASSESSMENT
Electronic Retailing
LG 5 Non-Store Retailing
FORMS of NON-STORE RETAILING
Electronic Retailing
-- Selling goods and services to ultimate consumers over the Internet.
LG 5 Non-Store Retailing
FORMS of NON-STORE RETAILING
Telemarketing
LG 5 Non-Store Retailing
FORMS of NON-STORE RETAILING
Telemarketing
-- The sale of goods and services via the telephone.
Vending machines, kiosks, and carts dispense convenience goods when consumers deposit sufficient funds.
LG 5 Non-Store Retailing
FORMS of NON-STORE RETAILING
Direct Selling
LG 5 Non-Store Retailing
FORMS of NON-STORE RETAILING
Direct Selling
-- Selling goods and services to customers in their homes or workplaces.
LG 5 Non-Store Retailing
FORMS of NON-STORE RETAILING
Direct Marketing
LG 5 Non-Store Retailing
FORMS of NON-STORE RETAILING
Direct Marketing
-- Any activity that directly links manufacturers or intermediaries with ultimate customers.
LG 5 Non-Store Retailing
FORMS of NON-STORE RETAILING
Corporate Distribution Systems
Contractual Distribution Systems
Administered Distribution Systems
Supply Chains
LG 6 Building Cooperation in Channel Systems
The FOUR SYSTEMS of CHANNEL RELATIONSHIPS
Corporate Distribution Systems -- Exist when one firm owns all the organizations in a channel of distribution.
Examples:
Goodyear
Sherwin Williams
LG 6 Building Cooperation in Channel Systems
CORPORATE DISTRIBUTION SYSTEMS
Supply Chain
LG 6 Building Cooperation in Channel Systems
Supply Chain
-- All the linked activities various organizations must perform to move goods and services from the source of raw materials to ultimate consumers.
LG 6 Building Cooperation in Channel Systems
SUPPLY CHAINS
LG 6 Building Cooperation in Channel Systems
The SUPPLY CHAIN
Logistics
LG 7 Logistics: Getting Goods to Consumers Efficiently
USING LOGISTICS
Logistics
-- The planning, implementing and controlling of the physical flow of goods from manufacturers to consumers.
LG 7 Logistics: Getting Goods to Consumers Efficiently
USING LOGISTICS
Firms may outsource to companies specializing in trade compliance to determine what is needed to market products to global customers.
LG 7 Logistics: Getting Goods to Consumers Efficiently
USING LOGISTICS
LG 7 Logistics: Getting Goods to Consumers Efficiently
Most Popular Modes of Freight Transport
Method
% of Distributors
Trucks
69%
Trains
15%
Pipelines
10%
Ships
6%
Air
Under 1%
Storage warehouses hold products for a relatively long period of time.
LG 7 The Storage Function
STORAGE WAREHOUSES
What is the Supply Chain?
What is supply logistics?
PROGRESS ASSESSMENT
END OF CHAPTER 15
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See Learning Goal 2: Demonstrate how intermediaries perform the six marketing utilities.
See Learning Goal 2: Demonstrate how intermediaries perform the six marketing utilities.
See Learning Goal 2: Demonstrate how intermediaries perform the six marketing utilities.
See Learning Goal 2: Demonstrate how intermediaries perform the six marketing utilities.
See Learning Goal 2: Demonstrate how intermediaries perform the six marketing utilities.
See Learning Goal 2: Demonstrate how intermediaries perform the six marketing utilities.
See Learning Goal 3: Identify the types of wholesale intermediaries in the distribution system.
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See Learning Goal 6: Explain the various ways to build cooperation in channel systems.
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See Learning Goal 6: Explain the various ways to build cooperation in channel systems.
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See Learning Goal 7: Describe logistics and outline how intermediaries manage the transportation and storage of goods.
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See Learning Goal 7: Describe logistics and outline how intermediaries manage the transportation and storage of goods.
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See Learning Goal 7: Describe logistics and outline how intermediaries manage the transportation and storage of goods.
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