Gestão da Distribuição e Vendas Sessão 3 Design de Canais Segmentação António Mamede Gestão da Distribuição e Vendas Channel Analysis Framework CHANNEL DESIGN Segmentation Channel Structure Splitting the Workload Degree of Commitment Gap Analysis CHANNEL IMPLEMENTATION Channel Power Channel Conflict Manage/Defuse Conflict Channel Coordination INSIGHTS FOR SPECIFIC CHANNEL INSTITUTIONS António Mamede Gestão da Distribuição e Vendas 1 Segmentation • Splitting market into groups of end-users • Similar within groups • Different between groups • Based on demands for the outputs of the marketing channel • Added value • Service outputs António Mamede Gestão da Distribuição e Vendas Segmentation • Example: Segments of book end-users • Recreational readers • University students • Convenience-oriented • Price-oriented António Mamede Gestão da Distribuição e Vendas 2 Selecting Target Segments • Those we can serve most profitably • Restrictions • Managerial bounds • Environmental bounds • Legal • Competitive benchmarks António Mamede Gestão da Distribuição e Vendas Start with the End User • Including channel members who do not sell to the end user • Derived demand • How end-users want to buy and use products and services • Segment based on demands for service outputs • Design channel solutions for target markets António Mamede Gestão da Distribuição e Vendas 3 Service Outputs • • • • • • Bulk breaking Spatial convenience Waiting time Product variety Customer service Information provision António Mamede Gestão da Distribuição e Vendas Bulk-Breaking • Enabling customers to buy in their desired quantities • Smaller lot size = higher service output level = higher price per unit • Accumulating António Mamede Gestão da Distribuição e Vendas 4 Spatial Convenience • Reducing customers’ transportation requirements and search costs António Mamede Gestão da Distribuição e Vendas Waiting Time • Time period between ordering and receiving products and services • Longer waiting times mean customers must be able to predict needs and plan further in advance • Original equipment versus post-sale service António Mamede Gestão da Distribuição e Vendas 5 Product Variety and Assortment • Variety • Generically different classes of goods • Breadth • Assortment • Different models within a class of goods • Depth • What assortment António Mamede Gestão da Distribuição e Vendas Product Variety and Assortment Broad Narrow Limited assortment of a wide variety of products Limited assortment of a limited variety of goods Comprehensive assortment of a wide variety of products Comprehensive assortment of a limited variety of goods Shallow Deep António Mamede Gestão da Distribuição e Vendas 6 Customer Service • Easing the shopping and purchase process António Mamede Gestão da Distribuição e Vendas Information Provision • Education of customers about: • Product attributes • Product usage capabilities • Solutions retailing • Pre-purchase services • Post-purchase services António Mamede Gestão da Distribuição e Vendas 7 Level of Service Outputs and Intermediaries • The greater the level of service outputs demanded, the more likely it is that intermediaries will be included in the channel system • Small lots • Reduced waiting time António Mamede Gestão da Distribuição e Vendas Balancing Service Outputs and Price • End-users choose between: • Low-service-output, low-price channel • High-service-output, high-price channel • Price is not a service output • Free-riding • Alienable • Inalienable António Mamede Gestão da Distribuição e Vendas 8 Service Outputs—Alienable or Inalienable Running shoes at NB store versus zappos.com Service Output Alienable Trying on X Expert advice X Inalienable Easy returns X Association with pro runners X António Mamede Gestão da Distribuição e Vendas Segmenting the Market • Identify all relevant service outputs • A priori segmentation • Service output segmentation • Maximally similar within groups • Maximally different between groups • On dimensions that matter António Mamede Gestão da Distribuição e Vendas 9 Marketing Research for Segmentation Please rate each of the following in terms of importance on a 1-5 scale with 5 being most important. 5 5 5 5 5 5 Demonstrations Assistance Installation Support after sale Relationship Low price António Mamede 5 5 5 5 5 5 Gestão da Distribuição e Vendas Marketing Research for Segmentation Constant-sum scales Please divide 100 points between these different services, such that the most important have the most points Demonstrations Assistance Installation Support after sale Relationship Low price António Mamede 14 18 13 10 2 43 13 11 19 44 14 9 Gestão da Distribuição e Vendas 10 Meeting Service Output Demands (or not) • Can be very expensive and time-consuming • Are there times when the demands can go unmet? • Cost—prohibitively expensive • Decide whether or not to provide the service • Decide whether to cover the cost or explicitly charge the customer • Competitive—what do the competitors offer? • Providing extra service may not affect market share António Mamede Gestão da Distribuição e Vendas Meeting Service Output Demands (or not) • Are there times when the demands can go unmet? (continued) • Ease of entry • New competitors • Other elements of excellence in offering • Very low price • Truly superior product António Mamede Gestão da Distribuição e Vendas 11 Selecting Segments to Target • Assess segment attractiveness • Select segments to target and not to target •Customize the marketing channel for each targeted segment •Create new marketing channels •Modify existing marketing channels António Mamede Gestão da Distribuição e Vendas Gestão da Distribuição e Vendas Sessão 4 e 5 Design de Canais Estrutura dos Canais António Mamede Gestão da Distribuição e Vendas 12 Channel Analysis Framework CHANNEL DESIGN CHANNEL IMPLEMENTATION Segmentation Channel Power Channel Structure Splitting the Workload Degree of Commitment Gap Analysis Channel Conflict Manage/Defuse Conflict Channel Coordination INSIGHTS FOR SPECIFIC CHANNEL INSTITUTIONS António Mamede Gestão da Distribuição e Vendas Channel Design Channel Design: Decisions involving the development of new marketing channels either where none had previously existed or to the modification of existing channels António Mamede Gestão da Distribuição e Vendas 13 Who Engages in Channel Design? Retailers Wholesalers Firms • Producers, manufacturers, service providers, franchisors • Look up the channel to secure suppliers • Look both up and down the channel • Look down the channel toward the market António Mamede Gestão da Distribuição e Vendas Channel Design Paradigm 1. Recognize the need for channel design decision 7. Select channel members 2. Set & coordinate distribution objectives 6. Choose the “best” channel structure 3. Specify distribution tasks 5. Evaluate relevant variables António Mamede 4. Develop alternative channel structures Gestão da Distribuição e Vendas 14 When to Make a Channel Design Decision • Developing a new product or product line • Aiming an existing product at a new market • Making a major change in some other component of the marketing mix • Establishing a new firm • Adapting to changing intermediary policies that may inhibit attainment of distribution objectives António Mamede • Dealing with changes in availability of particular kinds of intermediaries • Opening up new geographic marketing areas • Facing the occurrence of major environmental changes • Meeting the challenge of conflict or other behavioral problems • Reviewing and evaluating Gestão da Distribuição e Vendas 6 Distribution Objectives Setting distribution objectives requires knowledge of which, if any, existing objectives & strategies may impinge on these distribution objectives. António Mamede Gestão da Distribuição e Vendas 15 The Need for Congruency Firm’s Overall objectives & strategies General marketing objectives & strategies Product marketing objectives & strategies António Mamede Pricing marketing objectives & strategies Promotion marketing objectives & strategies Distribution marketing objectives & strategies Gestão da Distribuição e Vendas Distribution Tasks Outlining distribution tasks is specific and situationally dependent on the firm. For example: Distribution tasks for a manufacturer of consumer products differs from those for products sold in industrial markets. = Distribution tasks are a function of the distribution objectives and the types of firms involved. António Mamede Gestão da Distribuição e Vendas 16 6 Channel Structure Dimensions 1. Number of levels in the channel 2. Intensity at the various levels Allocation Alternatives 3. Types of intermediaries at each level António Mamede Gestão da Distribuição e Vendas Number of Levels • Range from two to five or more • Number of alternatives is limited to two or three choices • Limitations result from the following factors: • Particular industry practices • Nature & size of the market • Availability of intermediaries António Mamede Gestão da Distribuição e Vendas 17 Intensity at the Various Levels Relationship between the intensity of distribution dimension & number of retail intermediaries used in a given market area Intensity Dimension Intensive Selective Exclusive Numbers of Intermediaries (retail level) Many António Mamede Few One Gestão da Distribuição e Vendas Types of Intermediaries • Numerous types • Manager’s emphasis on types of distribution tasks performed by these intermediaries • Watch emerging types • Electronic online auction firms (eBay) • Industrial products sold in B2B markets (Chemdex, Converge.com) António Mamede Gestão da Distribuição e Vendas 18 Variables Affecting Channel Structure Categories of Variables 1. 2. 3. 4. 5. 6. Market Variables Product Variables Company Variables Intermediary Variables Environmental Variables Behavioral Variables António Mamede Gestão da Distribuição e Vendas Market Variables Market Geography Location, geographical size, & distance from producer Market Size Number of customers in a market Market Density Number of buying units (consumers or industrial firms) per unit of land area Market Behavior Who buys, & how, when, and where customers buy António Mamede Gestão da Distribuição e Vendas 19 Product Variables Bulk & Weight Perishability Unit Value Degree of Standardization Technical versus Nontechnical Newness António Mamede Gestão da Distribuição e Vendas Company Variables Size The range of options is relative to a firm’s size Financial Capacity The greater the capital, the lower the dependence on intermediaries Managerial Expertise Intermediaries are necessary when managerial experience is lacking Objectives & Strategies Marketing & objectives may limit use of intermediaries António Mamede Gestão da Distribuição e Vendas 20 Intermediary Variables Availability Cost Services António Mamede Availability of intermediaries influences channel structure. Cost is always a consideration in channel structure. Services that intermediaries offer are closely related to the selection of channel members. Gestão da Distribuição e Vendas Environmental Variables Competitive Economic Sociocultural The impact of environmental forces is a common reason for making channel design decisions. Technological António Mamede Legal Gestão da Distribuição e Vendas 21 Behavioral Variables Develop congruent roles for channel members. Be aware of available power bases. Attend to the influence of behavioral problems that can distort communications. António Mamede Gestão da Distribuição e Vendas Channel Structure 1. Types of channel members 2. Identities of specific channel members 3. Channel intensity: number of each type António Mamede Gestão da Distribuição e Vendas 22 Channel Members • Manufacturers • Intermediaries • Retailers • Wholesalers • End-users António Mamede Gestão da Distribuição e Vendas Channel Members • Channel formats—combinations of channel members • Specialization • Third-party logistics (3PL) • Channel captain • Manufacturer brands • Private brands António Mamede Gestão da Distribuição e Vendas 23 Channel Development and Change • Demand-side factors António Mamede • Supply-side factors Gestão da Distribuição e Vendas Demand-Side Factors • Facilitation of search • Adjustment for assortment discrepancy • Sorting • Accumulation • Allocation (breaking bulk) • Assorting António Mamede Gestão da Distribuição e Vendas 24 Supply-Side Factors • Routinization of transactions • Continuous replenishment programs (CRP) • Reduction in number of contacts Manufacturers Retailers Manufacturers Wholesaler Retailers António Mamede Gestão da Distribuição e Vendas Marketing Flows • Processes flow through the channel • Done at different points in time by different channel members António Mamede Gestão da Distribuição e Vendas 25 Marketing Flows • The Eight Universal Marketing Channel Flows 1. Physical possession 2. Ownership 3. Promotion 4. Negotiation 5. Financing 6. Risking 7. Ordering 8. Payment • Flow of information António Mamede Gestão da Distribuição e Vendas 26
