Week 9

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Questions and Answers

What is the primary role of marketing intermediaries in the distribution channel?

To manage the marketing mix

To act as a connection between the producer and the end user (correct)

To produce the final product

To manage the supply chain

What is the term for making products available at the time the consumer wants to purchase them?

Possession utility

Form utility

Time utility (correct)

Place utility

What is the goal of channel management?

To distribute products in the right quantities to the right locations at the right time (correct)

To manage the supply chain

To manage the marketing mix

To produce the final product

What is the term for making transactions as simple and cheap as possible by establishing and managing efficient exchange processes?

Exchange efficiencies Signup and view all the answers

What is the term for making products available in the locations the consumer wants them?

Place utility Signup and view all the answers

What is the primary goal of marketing logistics?

To meet customer requirements at a profit Signup and view all the answers

What is the term for making it easier to acquire products?

Possession utility Signup and view all the answers

What is one of the advantages of using intermediaries in distribution?

To earn a greater return by focusing on their core business Signup and view all the answers

What is one of the marketing channel functions of intermediaries?

Gathering and distributing information Signup and view all the answers

What is one of the critical roles of intermediaries as sales specialists for suppliers?

Creating assortments for suppliers Signup and view all the answers

What is one of the critical roles of intermediaries as purchasing agents for customers?

Anticipating wants for customers Signup and view all the answers

What is one of the key decisions involved in channel strategy?

Selecting the most effective distribution channel Signup and view all the answers

What is one of the disadvantages of using intermediaries in distribution?

Lack of control Signup and view all the answers

What is the goal of balancing the discrepancies of quantity and assortment in distribution?

To match supply and demand Signup and view all the answers

What is a key aspect of a retailer's image/atmosphere?

Establishing retail position Signup and view all the answers

What is a major challenge faced by retailers in today's marketplace?

Need to integrate technology Signup and view all the answers

What is the primary goal of a customer who engages in 'webrooming'?

To find the lowest price Signup and view all the answers

What is the term for a retailer that operates multiple stores, each with its own management?

Corporate chain Signup and view all the answers

What is the primary goal of 'omni-channel retailing'?

To create a seamless cross-channel buying experience Signup and view all the answers

What is the term for a retailer that offers a limited range of products?

Limited service retailer Signup and view all the answers

What is the primary goal of a customer who engages in 'showrooming'?

To experience products in person Signup and view all the answers

What is the primary characteristic of a direct marketing channel?

It has no intermediary levels Signup and view all the answers

What is the result of channel conflict?

Frustration and conflict for the whole channel Signup and view all the answers

What is the primary goal of retailers?

To sell goods or services directly to final consumers Signup and view all the answers

What is the main advantage of multichannel distribution systems?

Gaining sales with each new channel Signup and view all the answers

What is the primary benefit of channel cooperation?

Faster inventory replenishment and improved customer service Signup and view all the answers

What is the primary characteristic of vertical marketing channels?

Combining two or more stages of the marketing channel under one management Signup and view all the answers

What is the primary role of a channel captain?

To lead a marketing channel or supply chain Signup and view all the answers

What is the primary characteristic of franchising?

An approach to business in which one party licenses the business model to another party Signup and view all the answers

How do retailers vary dramatically?

In the amount of service offered Signup and view all the answers

Study Notes

Retailing and Strategic Issues

Retailing involves selling goods or services directly to final consumers for their personal, non-business use.
Retailers can vary dramatically, offering different levels of service, such as self-service, limited service, and full service.
Strategic issues in retailing include:
- Store image and atmosphere, which is crucial for attracting customers and establishing a retail position.
- Consumers' desire for more individualized experiences.
- The need to integrate technology.
- The power shift away from retailers to customers.

Types of Retailing

Webrooming: researching online and going to the store to make a purchase.
Showrooming: going to the store to research and then buying online.
Boom rooming: researching online, checking out products in-store, and finding the cheapest price online.

Future of Retail

New formats and concepts will emerge.
Experience will become a key aspect of retailing.
Technology will play a crucial role, including non-store retailing and omni-channel retailing.
Retail design will become more important.
Omni-channel retailing involves creating a seamless cross-channel buying experience that integrates in-store, online, and mobile shopping.

Marketing Channels

A marketing channel is a part of the supply chain, involving the downstream activities of distributing products from producers to customers.
Marketing channels involve individuals and organizations working together to make products available to end users.
Channel management involves managing the distribution of products to the right locations at the right time.
Marketing intermediaries, such as wholesalers and retailers, act as a bridge between producers and end users.

Marketing Intermediaries

Intermediaries perform various functions, including:
- Information gathering and distribution.
- Promotion and persuasion.
- Facilitating exchange, including contact, matching, and negotiation.
- Physical distribution and logistics.
- Financing and risk taking.
Intermediaries play a crucial role in matching supply and demand.
Two critical roles for intermediaries are:
- Sales specialists for suppliers.
- Purchasing agents for customers.

Channel Strategy

Channel strategy involves three key decisions:
- Selecting the most effective distribution channel (number of levels).
- Determining the most appropriate level of distribution intensity.
- Deciding on the degree of channel integration.
Channel strategy affects other aspects of marketing, including fulfilling delivery promises and meeting customer expectations.

Channel Management

Channel management involves managing the distribution of products to the right locations at the right time.
Effective channel management involves:
- Time utility: making products available at the time the consumer wants to purchase them.
- Place utility: making products available in the locations the consumer wants them.
- Possession utility: making it easier to acquire.
- Form utility: customizing products to the consumer's particular needs.
- Exchange efficiencies: making transactions as simple and cheap as possible.

Why Use Intermediaries?

Intermediaries can perform functions that manufacturers may not have the resources or expertise to do.
Intermediaries can earn a greater return by focusing on their core business.
Involving intermediaries can make distribution more efficient for producers and consumers.

Channel Levels

A channel level is a layer of intermediaries who perform some work in bringing the product and its ownership closer to the final buyer.
The number of intermediary levels indicates the length of a channel.
A direct marketing channel has no intermediary levels, while an indirect marketing channel contains one or more intermediary levels.
Multichannel distribution systems involve setting up two or more marketing channels to reach one or more marketing segments.

Channel Integration

Channel integration involves combining two or more stages or levels of the marketing channel under one management.
Vertical integration involves combining stages or levels of the marketing channel, while horizontal integration involves combining organizations at the same level of operation.

Channel Leadership and Cooperation

Channel leadership involves administering the channel, with the channel captain being the dominant leader of the marketing channel or supply chain.
Channel power involves the ability of one channel member to influence another member's goal achievement.
Channel cooperation involves working together to achieve common goals, leading to faster inventory replenishment, improved customer service, and lower costs.

Channel Conflict

Channel conflict occurs when self-interest creates misunderstandings about role expectations, leading to frustration and conflict among channel members.
Conflict can be horizontal (between firms at the same level) or vertical (between firms at different levels of the channel).
Multiple channels driven by new technology have increased the potential for conflict within the channel.

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Description

This quiz covers key concepts in retailing, including types of service, product line, prices, and organizational structures. It also explores strategic issues such as store image and atmosphere, and how they impact customer attraction and retail positioning.