Marketing in Action
Innovative Distribution
Calyx & Corolla
sells fresh flowers
and plants direct
to consumers
over the phone
and via the Web,
cutting a week or
more off the time
it takes flowers to
reach consumers
via conventional
retail channels.
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Figure 10-1
How Distributors Reduce the Number of
Channel Transactions
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Figure 10-2
Consumer and Business Marketing
Channels
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Marketing in Action
Channel Conflict
Goodyear’s
conflicts with its
independent dealers
have caused hard
feelings and
flattened the firm’s
replacement tire
sales.
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Let’s Talk!
Branded goods using
the Wolfgang Puck,
T.G. I. Friday’s, Taco
Bell, Emeril’s, and
Starbuck’s names are
now being sold in
grocery stores.
Look at the items at
right. Which stands
the greatest risk of
causing channel
conflict? Why?
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Figure 10-3
Conventional Marketing Channel Vs. Vertical
Marketing System
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Franchise Organizations
 Manufacturer-Sponsored
Retailer Franchise
– Ford and its independent
franchised dealers
 Manufacturer-Sponsored
Wholesaler Franchise
– Coca-Cola’s licensed bottlers
 Service-Firm Sponsored
Retailer Franchise
– McDonald’s, Avis, and
Holiday Inn
What type of franchises
are illustrated above?
http://www.franchise.org/
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Figure 10-4
Marketing Channels
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Marketing in Action
Disintermediation
Black & Decker chose to avoid disintermediation by not
using the Internet to sell their products, but rather direct
consumers to stores that carry the firm’s products.
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Marketing in Action
Selective Distribution
Maytag uses selective distribution
like many furniture and appliance
manufacturers.
The “Where to Buy” page on their
Web site assists buyers in finding
stores that carry the Maytag brand.
http://www.maytag.com
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Let’s Talk!
The Roomba by iRobot is a
self-propelled vacuum
cleaner that avoids falling
off of stairs, vacuums
along walls and furniture,
and recharges itself. Prices
range from $150 - $399.
How many intermediaries
would be appropriate for
this product? Why?
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Channel Management
Decisions
 Selecting channel
members
– Many factors should
be considered.
 Managing and
motivating channel
members
– Partner relationship
management
 Evaluating channel
members
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GE’s CustomerNet is a partner
relationship management tool that
offers dealers 24/7 access to GE’s
prices and product availability.
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Public Policy and Distribution
Decisions
 Exclusive
distribution
 Exclusive dealing
 Exclusive
territorial
agreements
 Tying
agreements
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If Xerox required every business
who bought or leased their copiers
to also buy their brand of paper, it
would be a tying agreement.
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Figure 10-5
Supply Chain Management
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Marketing in Action
RFID – The Wave of the Future
Key benefits of RFID
include fewer sales lost
due to stock-outs and
reduced labor costs.
RFID Systems highlights
these facts in their ad, and
suggests in a different ad
execution that retailers will
soon mandate supplier use
of RFID. Learn more:
www.rfidsystemsinc.com/
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Transportation
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Trucks
Railroads
Water carriers
Pipelines
Air
Internet
Intermodal
transportation
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Marketing in Action
Intermodal Transportation
Intermodal transportation combines two or more modes of
transportation. Fishyback = water and trucks; Piggyback = trucks
and rail; Trainship = water and rail; Airship = air and water.
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Marketing in Action
Third-Party Logistics
UPS’s Supply Chain
Solution Group can
help a firm shorten its
supply chain and
convert the supply
chain into a strategic
asset.
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