2. “Marketing channels are sets of
interdependent organizations
involved in the process of making a
product or service available for use
or consumption”
Philip Kotler
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3. A plan created by the management of
a manufacturing business that specifies how the firm
intends
to transfer its products to intermediaries, retailers and
end consumers.
Larger companies involved in making products will usually
also put together a detailed production distribution strategy
to guide its entry into its intended market.
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6. Exclusive Distribution
◦ Limiting the distribution to only one intermediary
in the territory
Intensive distribution
◦ Distribute from as many outlets as possible to
provide location convenience
Selective distribution
◦ Appoint several but not all retailers
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7. It is a situation where suppliers and distributors enter into
an exclusive agreement that only allows the named
distributor to sell a specific product
Means that the producer selects only very few intermediaries.
Exclusive distribution is often characterised by exclusive
dealing where the reseller carries only that producer's
products to the exclusion of all others
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8. Maximize control over service level/output
Enhance product’s image & allow higher
markups
Promotes dealers loyalty, better forecasting,
better inventory and merchandising control
Restricts resellers from carrying competing
brands
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9. Betting on one dealer in each market
Only suitable for high price, high margin,
and low volume products
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10. The producer's products are stocked in the
majority of outlets
It is a strategy under which a company sells
its product through as many outlets as
possible so that the customers encounter
the product virtually everywhere they go
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11. Advantages:
◦ Increased sales, wider customer recognition,
and impulse buying
Disadvantages:
◦ Characteristically low price and low-margin
products that require a fast turnover
◦ Difficult to control large number of retailers
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13. Selective Distribution is a type of
distribution that lies between intensive and
exclusive distribution.
This basically involves using more than
one, but lesser than all the intermediaries
who carry the company’s products
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14. Advantages:
◦ Better market coverage than exclusive
distribution
◦ More control and less cost than intensive
distribution
◦ Concentrate effort on few productive outlets
◦ Selected firms capable of carrying full product
line and provide the required service
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15. Disadvantages:
◦ May not cover the market adequately
◦ Difficult to select dealers (retailers) that
can match your requirement and goals
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16. Using two or more different channels to
distribute goods and services
Why?
◦ Permits optimal access to each market segment
◦ Increase market coverage, lower channel cost and
provide more customized selling
What to look out for?
◦ More channels usually means more conflict and control
problems
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17. Each channel handles a product or segment
that is different or non-competing e.g.
Toyota Lexus
MPH online portals
Magazine distributions
18. The same product is sold through two different
and competing channels e.g.
◦ Non-prescriptive drugs
◦ Electronic goods
Why? To increase sales
What to look out for?
◦ Over extending yourself
◦ Dealers’ resentment
◦ Control problems
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19. Modify when the following changes occur:
Consumer markets and buying habits
Customer needs
Competitor’s perspectives
Relative importance of outlet types
Manufacturer’s financial strength
Sales volume level of existing products, and
The marketing mix
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20. One of the importance of any website or business is
to bring the products or services to the right people
and to reach the target audience.
There are a number of different distribution
channels available on the Internet which could be
utilised efficiently to the benefits of any company
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