TOPIC 10 – SELECTING THE CHANNEL MEMBERS
– SELECTION CRITERIA
Applying selection criteria is a more difficult
problem because no single list of criteria is
appropriate for all firms. One must create or develop
specific list depending on the policies, objectives,
and the nature of the business. This way, a firm can
screen its channel members and can decide if they
will be included in the channel structure being
designed by the company.
SELECTION CRITERIA:
• Credit and Financial Condition
• Sales Strength
o Sales capacity
o Quality of salespeople and number of
salespeople employed (for wholesale
intermediaries)
• Product Lines
o 4 aspects of intermediaries’ product
lines:
§ Competitive products
§ Compatible products
§ Complementary products
§ Quality of lines carried
• Reputation
o Store image is an especially critical
component of the retailer’s overall
reputation
o Not good reputation = manufacturer
would not want to work with the store
• Market Coverage
o Adequacy of intermediary covering the
geographic territory that the
manufacturer would like to reach
• Sales Performance
o Whether perspective intermediary can
capture as much market share as the
manufacturer expects
o Often the manufacturers will seek:
Detailed sales performance
Information from perspective
intermediaries to get the firsthand
view
of
their
effectiveness
• Management Succession
• Management Ability
o Critical in choosing channel members
o Good sales force = good management
• Attitude
o Aggressiveness
o Enthusiasm
o Initiative
= Long term success
• Size
o Share size – the larger the organization,
the larger the sales of the
manufacturer’s products
ADAPTING SELECTION CRITERIA:
• No list of criteria is adequate for a firm under all
condition, the channel manager should be
flexible when using selection criteria.
o You may develop your own criteria for
selection.
WHO SELECTS?
• Producers & Manufacturers
• Wholesale Intermediaries
• Retail Intermediaries
SECURING CHANNEL MEMBERS:
• The supplier produces
• The distributor sells
o Each is dependent upon each other
o Together, they form a team
o Teamwork is essential if the association
is to prove mutually beneficial
OFFERING INDUCEMENTS:
• Manufacturer’s Product Line
• Advertising and Promotional Support
• Management Assistance
§
§
• Fair Dealing Policies and Friendly Relationships
Financial support is not a good inducement that
manufacturers might offer prospective channel
members.
1. Product Line:
o Manufacturer offers good product line
with strong sales and profit potential
o Stress value of good product line from
channel members’ perspective
o In using its product line to secure new
channel members, it is most important
for the manufacturer to stress the profit
potential of the product.
2. Advertising and Promotion:
o Consumer Market – gain immediate
credibility by using a strong program of
national advertising
o Industrial Market – gain recognition by
using a strong program of trade paper
advertising
3. Management Assistance:
o Prospective members want to know
whether the manufacturer will help
with the following:
o Training programs
o Financial analysis and planning
o Market analysis
o Inventory control procedures
o Promotional methods
4. Fair Dealing and Friendly Relationship:
o Manufacturer’s Responsibility:
To convey to prospective channel
members that he or she is genuinely
interested in establishing a good
relationship based on trust and
concern for their welfare as both
business entities and as people
TOPIC 11 & 12 – TARGET MARKETS AND
CHANNEL DESIGN STRATEGY
MARKET VARIABLES:
o Market Geography
o Market Size
o Market Density
o Market Behavior
The target market’s needs and wants should drive
the manner in which the channel manager shapes
the design of the firm’s marketing channels.
FRAMEWORK
FOR
MARKET
ANALYSIS
(Dimensions):
o Market Geography à Target Market
o Market Size à Target Market
o Market Density à Target Market
o Market Behavior à Target Market (most
complex)
MARKET GEOGRAPHY:
o The geographical extent of markets and where
they are located.
o How distant are your market?
o Channel manager’s task:
o To evaluate market geography relative
to channel structure to ensure that the
structure is able to serve the markets
effectively and efficiently.
o Locating Markets:
o Channel
manager
delineates
geographical locations of target
markets by using a combination of the
following:
§ Census
§ Postal ZIP codes
o Challenge: keeping track of
geographical changes in existing
markets and forecasting such changes
for the future.
o What is required from a channel
manager:
§
Awareness of and sensitivity to
changes in market geography
reflected in the source of data
and willingness to examine
their possible implications.
MARKET SIZE:
o The number of buyers or potential buyers
(consumer or industrial) in a given market.
o Number of buyers vs. average cost of serving
them?
o Change channel structure to reduce costs?
o Would this yield a differential advantage?
o Channel Manager’s Task:
o When using Bucklin’s model for
market size data, it is important also to
consider the peculiarities of particular
situations and other relevant variables.
o Other things being equal, the greater the
distance between a producer (manufacturer)
and his markets, the higher the profitability that
a channel using intermediaries will be less
expensive (economies of scope and scale).
MARKET DENSITY:
o The number or buyers or potential buyers per
unit of geographical area
o This market dimension’s relationship to channel
structure is illustrated in the concept of efficient
congestion
o Efficient Congestion – congested (high-density)
markets can promote efficiency in the
performance of several basic distribution tasks,
particularly those of transportation, storage,
communication and negotiation.
o Efficiency on distribution tasks:
1. Transportation
2. Storage
3. Communication
4. Negotiation
o Strategic Implication:
o The opportunity to achieve a high level
of customer access at low cost is higher
in dense markets than in more
dispersed ones.
MARKET BEHAVIOR:
o Sub-dimensions:
1. When the market buys
2. Where the market buys
3. How the market buys
4. Who buys
When the market buys:
o Variation occurs:
1. Daily
2. Weekly
3. Seasonally
o Strategic implication:
1. Variations create peaks and valleys in the
manufacturer’s production schedule.
2. He or she should attempt to select channel
members who are in tune with these
changing patterns.
Where the market buys:
o Determined by the types of outlets from which
final buyers choose to make their purchases
o Determined by the location of those outlets
o Strategic implication:
1. He or she should know where customers
generally buy particular types of products
2. He or she should know whether these
patterns may be changing
How the market buys:
o Large quantities
o Self-service
o One-stop shopping
o Impulse buying
o Cash
o Shopping at home
o Expending substantial effort
o Demanding extensive service
o Small quantities
o Assistance by salespeople
o Buying from several stores
o Decision making prior to purchase
o Credit
o Shopping at stores
o Expending little effort
o Demanding little service
Who buys:
o Concern: who makes the physical purchase?
o Affects the type of retailers chosen in
the consumer market
o May influence the kinds of channel
members used to serve industrial
markets
o Concern: who decides to make the purchase?
o In context of family unit at consumer
level
o Buying centers at industrial level:
§ Users
§ Influencers
§ Deciders
§ Approvers
§ Buyers
§ Gatekeepers
Changes in Market Behavior:
o Channel Manager’s Role:
o Must be tuned in to changes that are
likely to occur
o Needs to determine whether changes
are temporary or long-term
TOPIC 13 – MOTIVATING THE CHANNEL
MEMBERS
Channel Management vs. Channel Design
Channel Management à “running” the channel
Channel Design à “setting up” the channel
Channel Management:
o The administration of existing channels to
secure the cooperation of channel members in
achieving the firm’s distribution objectives
o Motivation Management:
o The actions taken by the manufacturers
to foster channel member cooperation
in implementing the manufacturer’s
distribution objectives.
Motivating Channel Members:
o Find out the needs and problems of channel
members.
o Offer support to the channel members that is
consistent with their needs and problems
o Provide leadership through the effective use of
power
Learning About Channel Member Needs and
Problems:
o Approaches for learning about member needs
and problems:
o Research studies of channel members
o Research studies by outside parties
o Marketing channel audits
o Distributor advisory councils
Research Studies of Channel Members:
o Manufacturer-initiated research can be useful
because certain types of needs or problems may
not be at all obvious.
o Research studies by outside parties:
o Provide a higher assurance of
objectivity
o Provide a level of expertise that the
manufacturer may not possess
Marketing Channel Audits:
o Focus of Channel Manager’s Approach:
o Gather data on how channel members
perceive the manufacturer’s marketing
program and its component parts.
o Locate the strengths and weaknesses in
the relationships
o Learn what is expected of
manufacturers to make the channel
relationship viable and optimal
o What makes marketing channel audits most
effective?
o Issues chosen for the audit should be
cross-referenced to any relevant
variables.
o It must be conducted periodically so as
to capture trends and patterns
o It should identify and define in detail
the issues relevant to the
manufacturer-wholesaler
and/or
manufacturer-retailer relationship
Distributor Advisory Councils:
o Who is involved?
o Top management representatives from
the manufacturer and from the channel
members
o What are the benefits?
o Provides recognition for the channel
members
o Provides a vehicle for identifying and
discussing mutual needs and
problems
o Results in an overall improvement of
channel communications
Supporting Channel Members:
3 types of Programs:
1. Cooperative
2. Partnership or Strategic Alliance
3. Distribution Programming
Cooperative Arrangements:
o Focuses on channel member needs and
problems
o Training salespeople
o Free goods
o Guaranteed sales
o Contest for buyers, salespeople, etc.
o Advertising allowances
o Payments for interior displays
o Rationale: to provide incentives for getting extra
effort from channel members in the promotion
of product of the manufacturer offering the
cooperative programs.
Partnerships & Strategic Alliances:
o Focus on a continuing and mutually supportive
relationship between the manufacturer and its
channel members in an effort to provide a more
highly motivated team, network, or alliance of
channel members.
o “your success is our success!”
o “us against them!”
o 3 basic phases:
o Manufacturer should make explicit
statement of policies in areas such as
product availability, technical support,
pricing, etc.
o Manufacturer should assess all existing
distributors as to their capabilities for
fulfilling their roles.
o Manufacturer should continually
appraise the appropriateness of the
policies guiding his or her relationship
with the channel members.
Distribution Programming:
o Comprehensive set of policies for the promotion
of a product through the channel.
o Developed as a joint effort between the
manufacturer and the channel members to
incorporate the needs of both
o Offers all channel members the advantages of a
vertically integrated channel while at the same
times allowing them to maintain their status as
independent business firms
Relationship Differences:
o Cooperative Arrangements:
o Intermittent interactions between
manufacturer and channel members
o Partnerships and Strategic Alliances:
o Continuing and mutually supportive
relationship
o Distribution Programming:
o Deals with virtually all aspects of the
channel relationship
The Selective Use of Power:
o The channel manage must exercise effective
leadership on a continuing basis to attain a wellmotivated team of members.
Challenges due to Limited Control:
Interorganizational System:
à overall planning uncoordinated
à diffused perspective necessary to maximize total
system effort
à reward and penalty system not precise
à loosely arranged firms = few advantages from
central direction
TOPIC 14 & 15 – PRODUCT ISSUES IN CHANNEL
MANAGEMENT
Marketing Mix Resources:
o By understanding how the other marketing mix
variable interface with the channel variable, and
the implications of such, the channel manager
could coordinate all strategic components to
create the synergy needed to meet customers’
needs.
o How can I blend the strategic components of the
marketing mix to best advantage in the
management of the marketing channel?
Product-Channel Management Interfaces:
o Three major areas of product management:
1. New
product
planning
and
development
o New technologies, changing customer
preferences and competitive forces all
contribute to the need to introduce
new products
o Achieving success for new product is
dependent on many factors
§ Ex. The degree of support a
new product receives from
independent
channel
members
o It is crucial for development of new
products.
o What can be done in the planning and
development stage to promote a
higher-level
cooperation
from
members for successful market for the
product?
o Five Issues:
§ Channel members’ input
§ Channel
members’
acceptance
§ Fitting the new product into
channel
members’
assortments
§ Educating
the
channel
members
§ A trouble-free new product
o Encouraging Member Input:
§ Solicit ideas for new products
§ Gather feedback on product
size or on packaging
§ Solicit feedback during the
test-marketing
or
commercialization stage
o Member Acceptance of New
Products:
§ Factors that pre-determine
acceptance of new products by
channel partners:
§ How the product will sell –
“turnover”
§ Whether the product is easy to
stock and display
§ Whether the product will be
profitable – “margins”
o Adding Products to the Assortment:
§ Will
existing
channel
members view the new
product as appropriate to add
to their assortments?
§ Will channel members feel
competent to handle the new
product?
o Educating Channel Members:
§ Manufacturer’s Goal: to sell
new products successfully
§ Method: educate or train
channel members in the
product’s use and the special
features to emphasize in sales
presentations
o Trouble-Free New Products:
§ From: Nuisance that makes it
more difficult for the channel
members to stock and sell the
product
§ To: More serious flaws that can
undermine brand equity that
channel members rely on to
attract customers
§ Avoiding
new
product
problems is crucial to
maintain a strong and highly
strong and highly motivated
team of channel participants.
2. The product life cycle
o Introduction à Growth à Maturity à
Decline
Introduction:
o Assure sufficient number of channel
members for adequate market
coverage
o Assure adequate supply on channel
members’ shelves
Growth:
o Assure sufficient number of channel
member inventories for adequate
market coverage
o Monitor the effects of competitive
products on channel member support
Maturity:
o Extra emphasis on motivating channel
members to mitigate competitive
impact
o Investigate possibility for changes in
channel structure to extend maturity
stage and possibly foster new growth
stage
Decline:
o Phase out marginal channel members
o Investigate impact of product deletion
on channel members
3. Strategic product management
o Successful product strategies depend
on a variety of factors.
o One of these factors is the role played
by channel members.
o Product quality, innovativeness, or
technological sophistication
o Capabilities of managers overseeing
product line
o Firm’s financial capacity and
willingness to provide promotional
support
o Channel
members’
role
in
implementing product strategies
Product Strategies:
o Product differentiation: creating a
differential product involves getting
consumers to perceive a difference
o Implication:
channel
managers should try to select
and help develop members
who fit the product image
when product differentiation
strategy is affected by who will
be selling the product
o Product
Positioning:
the
manufacturer’s attempt to have
consumers perceive the product in a
particular way relative to competitive
products.
o Implication:
channel
managers should provide
retailers with the kind of
support needed to properly
present the product when this
strategy is influence by how
the product is sold at retail.
o Product Line Expansion and
Contraction: manufacturers often
engage in both expansion and
contraction simultaneously.
o Implication: difficult to
balance channel member
satisfaction and support for
reshaped product lines.
o Trading Down, Trading Up: adding
lower-priced products or product lines,
or higher-priced products or product
lines, to a product mix
o Implication: whether existing
channel members provide
adequate coverage of highend or low-end market
segments to which trade-up or
trade-down product is aimed
o Whether
the
channel
members have confidence in
the manufacturer’s ability to
successfully market the tradeup or trade-down product.
o Product Brand Strategy: when
manufacturers sell under both national
and private brands, direct competition
with channel members may result.
o Implication: do not sell both
national and private brand
versions of products to the
same channel members.
o Product Service Strategy: it is the role
of the marketing channel to provide
necessary service along with the
product to the final user.
o By offering it directly at the
factory
o Through their own network of
service centers
o Through channel members
o Through
authorized
independent service centers
o By some combination of the
above
TOPIC 16 – PRICING ISSUES IN CHANNEL
MANAGEMENT
Importance of Pricing:
o Pricing decisions cause top-level marketing
executives more concern than any other
strategic marketing decision area.
o Pricing is viewed as having more direct link to
the firm’s bottom line.
Anatomy of Channel Pricing Structure:
o Channel participants each want a part of the
total price sufficient to cover their costs and
provide a desired level of profit.
o Manufacturer à Wholesaler à Retailer à
Consumer
o Variables involved:
o Trade discount
o Cost
o Markup
o Gross margin
The “Golden Rule” of Channel Pricing:
o It is not enough to base pricing decisions solely
on the market, internal cost considerations, and
competitive factors. Rather, for those firms
using independent channel members, explicit
consideration of how pricing decisions affect
channel member behavior is an important part
of pricing strategy.
o Pricing decisions can have a substantial impact
on channel member performance.
Channel Manager’s Role: 4 Issues to consider
when pricing a product
Major Areas of Consideration in a manufacturer’s
pricing decision:
o Internal cost considerations
o Target market considerations
o Competitive considerations
o Channel considerations
o Channel manager must focus on the
channel considerations and work to
incorporate them into the firm’s pricing
decisions
o Channel manager’s role: to find out
about channel member views and to
appraise their effects on channel
member performance
o Challenge: to help foster pricing
strategies that promote channel
member cooperation and minimize
conflict
Channel Pricing Guidelines:
o One must pay attention to specific guidelines
for dealing with pricing issues
o To help those involved in pricing decisions to
focus more clearly on the channel implications
of their pricing decisions
o To provide general prescriptions on how to
formulate pricing strategies that will help
promote channel member cooperation and
minimize conflict
Profit Margins:
o Guideline 1: each efficient reseller must obtain
unit profit margins in excess of unit operating
costs
o Channel members who believe that the
manufacturer is not allowing them sufficient
margins are likely to seek out other suppliers or
establish and promote their own private brands
Different Classes of Resellers:
o Guideline 2: each class of reseller margins
should vary in rough proportion to the cost of
the functions the reseller performs
1. Do channel members hold inventories?
2. Do they make purchases in large or small
quantities?
3. Do they provide repair services?
4. Do they extend credit to customers?
5. Do they deliver?
6. Do they help train the customers’ sales
force?
Rival Brands:
o Guideline 3: at all points in the vertical chain
(channel levels), prices charged must be in line
with those charged for comparable rival brands
o Channel managers should attempt to weigh any
margin differentials between their own and
competitive brands in terms of what kind of
support their firms offer and what level of
support they expect from channel members
Special Arrangements:
o Guideline 4: special distribution arrangements,
variations in functions performed or departures
from the usual flow of merchandise should be
accompanied by corresponding variations in
financial arrangements
o The margin structure should reflect any changes
in the usual allocation of distribution tasks
between the manufacturer and the channel
members
Conventional Norms in Margins:
o Guideline 5: margins allowed to any type of
reseller must conform to the conventional
percentage norms unless a very strong case can
be made for departing from the norms
o Exceptions are possible if they can be justified
in the eyes of the channel members. However,
it is the job of the channel manager to attempt
to explain to the channel members any margin
changes that deviate downward from the norm
Margin Variation on Models:
o Guideline 6: variations in margins on individual
models and styles of a line are permissible and
expected. However, they must vary around the
conventional margin for the trade
o Channel members are often agreeable to
accepting the lower margins associated with
promotional products so long as they are
convinced of the promotional value of the
product in building patronage
Price Points:
o Guideline 7: a price structure should contain
offerings at the chief price points, where such
price points exist
o Price points are specific prices, usually at the
retail level, to which consumers have become
accustomed. Failure to recognize retail price
points can create problems for the manufacturer
as well as its channel members if consumers
expect to find products at particular price points
and such products are not offered.
Product Variations:
o Guideline 8: a manufacturer’s price structure
must reflect variations in the attractiveness of
individual product offerings
o If the price differences are not closely associated
with visible or identified product features, the
channel members will have a more difficult
selling job
o Note: particular circumstances and situations
exist in which the prior guidelines will not apply
or will be irrelevant
Exercising Control in Pricing:
Because channel members typically view pricing as
the area over which they have total control:
1. Rule out any type of coercive approaches to
controlling channel member pricing
policies
2. The manufacturer should encroach on the
domain of channel member pricing policies
only if the manufacturer believes that it is in
his or her vital long-term strategic interest
to do so
3. If the manufacturer believes that it is
necessary to exercise some control over
member pricing, he or she should do so
through “friendly persuasion”
Changing Price Policies by Manufacturers:
o Changes in manufacturer pricing policies or
related terms of sale cause reactions among
channel members
o Channel members fear such changes because
they have become accustomed to the strategy,
or their own pricing strategies may be closely
tied to those of the manufacturer.
Passing Price Increases Through the Channel
Members:
o Strategies for channel members to use in order
to avoid simple passing along price increases
through the channel:
1. Manufacturers should consider the long
and the short-term implications of such
increases versus maintaining the current
prices
2. Manufacturers should do whatever
possible if passing on the price increase is
unavoidable
3. Manufacturers could change their
strategies in other areas of the marketing
mix to help offset the effects of such
increases
Using Price Incentives in the Channel:
o Manufacturers face difficulties gaining strong
retailer acceptance and follow-through on
pricing promotions
o Possible solutions:
o Make pricing promotions as simple
and straightforward as possible
o Design price-promotion strategies to
be at least as attractive to retailers as
they are to consumers
Gray Market and Free Riding:
o Gray Market – the sale of brand-name products
at very low prices by unauthorized distributors
or dealers
o Channel design decisions that result in
closely controlled channels and
selective distribution as well as
changing buyer preferences may help
limit the growth of the gray market and
free riding
o Free riding – describe the behavior of
distributors and dealers who offer low prices but
little, if any services, to customers
o Footballing – making disparaging remarks
about a product in order to sell a competitor’s
product
o Note: gray market vs. counterfeited products
TOPIC 17 – PROMOTION THROUGH THE
MARKETING CHANNEL
Channel Member Support:
o Why does a channel member support one of the
major tools of the manufacturer’s promotional
mix?
o Most products and services are not sold directly
to final customers
o Pull Strategy vs. Push Promotional Strategies:
o Pull strategy – manufacturers builds
strong consumer demand
o Push strategy – manufacturer develops
mutual effort and cooperation in the
development and implementation of
promotional strategies
Promotion through Channel Members:
o Stand a higher probability of being favorably
received by the channel members
o Strategies that are part of an overall program of
manufacturer support of channel member
needs
o Strategies that involve channel members
Basic Push Promotional Strategies:
o Promotional strategies emphasizing the push
approach initiated by the manufacturer but
requiring channel member support and followthrough can take many forms
1. Cooperative advertising
2. Promotional allowances
3. Slotting fees
4. Displays and selling aids
5. In-store promotions
6. Contests and incentives
7. Special
promotional
deals
and
merchandising campaigns
Cooperative Advertising:
o Typical Strategy: a sharing in the cost on a 50-50
basis up to some percentage of the retailer’s
purchases from the manufacturer
o Administration:
o Effective
administration
by
manufacturer is necessary to avoid
abuses and to help secure cooperation
from channel members
o Channel manager must be sensitive to
channel members’ primary concern
about this strategy
Promotional Allowances:
o Typical strategy: manufacturer offers channel
member a direct cash payment or a certain
percentage of the purchases on particular
products
o Administration:
o Manufacturer should conduct research
to determine whether it is getting its
money’s worth in terms of retailer
cooperation and follow-through
Slotting Fees:
o Manufacturer pays retailer to get a product into
a store and/or gain prominent placement
o Slotting fees help ensure grocer profits on a
product, help balance risk of trying unknown
product
o Grocery is a narrow margin business, slotting
fees can represent a significant revenue source
o Typical Strategy: payments by manufacturers to
persuade channel members, especially
retailers, to stock, display and support new
products
o Administration:
o Joint sponsorship of research between
retailers and manufacturers on effects
of slotting fees on various topics could
help alleviate conflict
Display and Selling Aids:
o Typical Strategy: include point-of-purchase
(POP) displays, dealer identification signs,
promotional kits, special in-store displays and
mailing pieces
o Administration:
o Channel manager should make the
effort to see whether the firm’s selling
aids and displays are serving any useful
purpose
In-Store Promotion:
o Typical Strategy: short-term events designed to
create added interest and excitement for the
manufacturer’s product
o Administration:
o The planning of a successful in-store
promotion should always include
considerations of the potential benefits
for the retailers involved
Contests and Incentives:
o Typical Strategy: techniques that manufacturers
use to stimulate channel members sales efforts
for their products
o Administration:
o Manufacturer should put much effort
into determining the view of channel
members toward this form of
promotion
Special Promotional Deals and Merchandising
Campaigns:
o Typical Strategy: include a variety of push-type
promotional deals such as discounts to channel
members to encourage them to order more
products
o Administration:
o Manufacturers need to develop
carefully planned strategies that are
based on knowledge of channel
member needs and that take a longterm perspective on promotion
through the marketing channel
4 Types of “Kinder and Gentler” Push Promotion:
o Training Programs
o Wholesale:
help
wholesalers’
knowledge, selling techniques, and
skill in counseling customers they call
on
o Retail: help retailer’s product
knowledge, selling techniques, and
counseling customers on product
usage
o Pro: manufacturers can assist
wholesalers and retailers by helping to
offset the cost
o Con: there is often little time for
training
o Quota Specification
o Sales volumes that manufacturers
specify for channel members to
generate during a certain time period
o Pro: can amount to a substantial sum
and can make a major difference in the
dealers’ overall profit picture
§ Can be effective in improving
channel member promotional
support
o Con: if presented in a coercive fashion,
it can produce ill will and conflict rather
than support
§ Channel members may ignore
quota if manufacturer’s line
does not make up an
important part of the
member’s product mix
o Missionary Selling
o Manufacturer’s salespeople who are
specially assigned to supplement the
selling activities of channel members
o Pro: a useful strategy when channel
members lack sales capacity or
competence to handle tasks assigned
to them
§ Useful
when
channel
members desire this service
o Con: expensive
§ Can cause conflicts in the
channel
§ Some members view these
salespeople as intruding on
the time of their own sales
force
o Trade Shows
o Annual events organized by
associations in particular industries
o Pros: opportunity for manufacturer to
sell existing and new channel
members substantial quantities of new
products face-to-face
§ A chance for manufacturers to
socialize
with
channel
members
§ Creates a sense of pride and
belonging
in
channel
members that sell its products