Developing Global Marketing
Strategies
International Marketing Channels
What is a marketing channel?
• A total firm-to-end-user links make up a marketing
channel. (Global Channel Strategy, Pearson Education
Inc., 2015)
• A set of interdependent organizations involved in the
process of making a product or service available for
use or consumption.
Key players in the marketing channel
Producer/
Manufacturer
Middleman
Consumer
• They combine labor
and capital to create
goods and services
for the consumers
• Intermediary or
agent between two
parties
• A person who buys
the product or
service for personal
use
Importance of marketing channel
Roles of Marketing
Channel
Information
Product
Physical possession
sharing
promotion
and ownership
Negotiation
Logistics and
Distribution
Risk sharing
Types of marketing channel
Direct marketing channel
Indirect marketing channel
Channel strategy framework
1. Analyzing and designing
 Development of the most effective channel structures and strategies
 Meeting the target end-users’ demands with the minimum possible
cost
2. Establish objectives and constraints in channel design
 This stage focuses on the objective that is to deliver maximum service
output at a minimal price.
Channel strategy framework
2. Establish objectives and constraints in channel design
(continuation)
1.
2.
3.
4.
5.
Perishable goods cannot be sold on channels that take time to reach the
customer.
Heavy products delivery should be transported on channels with minor
handling.
Delicate products should be ideally sold on channels like factory outlets or
franchises.
Customized products are usually done via direct sales.
Products requiring installation and regular maintenance are usually done
directly by the company.
Channel strategy framework
3. Identify channel alternatives
Elements to consider:
1. Type of intermediaries
a. The organization’s own sales force
b. Dealers and distributors
c. OEM markets or Original Equipment Manufacturers
2. Number of intermediaries
a. Exclusive distribution
b. Selective distribution
c. Intensive distribution
Channel strategy framework
3.
Responsibilities of channel members
Elements to arrive at channel responsibility
a. Price policy
b. Distributor’s territorial rights
c. Mutual services and responsibilities
4. Evaluate channel alternatives
Criteria in evaluating alternatives:
a. Economic criteria
Channel strategy framework
4. Evaluate channel alternatives (continuation)
b. Control criteria
c. Adaptive criteria
Channel management
Gartner sales glossary defines channel management as a
company’s engagement activities related to selecting,
enabling and compensating channel partners.
Elements in channel management
1.
2.
3.
4.
Selecting channel members
Training of channel members
Evaluating channel members
Channel modification decision
Channel integration
Channel integration can be defined as the strategies
and plans designed by the organization to deliver a
standard message across various channels the brand
might be using.
Methods of performing channel integration
1.
2.
Vertical marketing system
Horizontal marketing system
Types of Distribution Channels
• https://youtu.be/fvLGcdp7FbA
Developing Global Marketing
Strategies
Exporting and Logistics: Special Issues for
Business
What is exporting?
 It is a process of shipping a product to another part of the
world for trade or sale (Global Marketing 5th Ed., McGraw Hill,
2009)
 Includes





Identification of customers
Preparing products for shipment
Arranging documentation
Clearing customs
Planning shipping/delivery of product
Indirect exporting
 For a company not fully committed to international marketing
 Uses a broker or agent to help find customers and export
products
 Extra middlemen can increase total cost
Direct exporting
 For a company fully committed to foreign markets
 A company actively controls operations
Intermediaries in exporting
 Export trading company





Buy and sell products
Conduct market research
Overseas distribution
Provide funding and financing
Coordinate with shippers, suppliers, and manufacturers
 International freight forwarder
 Travel agent for cargo
 Ships products directly to foreign customers
Factors to consider in exporting
 Customs




Immigration control for products entering the country
Inspect shipments to ensure proper documentation
Collect custom fees
Ensure restricted products do not enter (e.g. dangerous items,
embargoed products, fake products, endangered items)
 Customs broker
 An intermediary that specializes in moving products through customs
Documentation for
clearing customs
 Bill of lading
 Issued by carrier to
shipper acknowledging receipt of
goods
 Describes type and quantity of
goods
 Describes how goods will be
shipped
 Identifies destination
Documentation for
clearing customs
 Certificate of origin
 Document that identifies the
country in which exported
goods are obtained, produced
or processed
 Helps determine import duties
or whether the products may
be legally imported,
depending on country of origin
Documentation for clearing customs
 Foreign Trade Zone
 An area designated by a country as a specialized zone where products
may be exempt from duties
 Products in FTZs may be stored, modified, displayed without duties
 Products exported out of FTZ’s no import duties are paid where FTZ is
located
Examples of Free Trade Zones in the Philippines
Key Documents for Export
https://youtu.be/ZLK9x8wsjBs
International Logistics
 Logistics involve the transportation and storage of products
between producer and consumer
 Modern technology makes logistics easier
 GPS allows ships to avoid bad weather
 Easy tracking
Logistics and the Total Cost Concept
 Transportation costs are major portion of total exporting costs
 Other cost factors to consider:
 Products shipped by water or land arrive with less certainty than by
air
 Greater chances for spoilage, loss or obsolescence
 Warehousing and insurance costs may be higher
 Air freight enhances security, limits shipping time, assures faster delivery
 Delivery terms
Logistics Process
Transportation modes
 Water
 Air cargo
 Land transportation
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Reporter: Mila D. Bedia