339 Exam 2

1) Role of distribution in the firm's overall objectives & strategies
2) Role distribution should play in the marketing mix
3) Design of the firm's marketing channels
4) Selection of channel members
5) Management of the marketing channel in order to implement the firm's channel design effectively & efficiently
6) Evaluation of channel member performance

1) Distribution is the most relevant variable for satisfying target market demands
2) Parity exists among competitors in the other three variables of the marketing mix
3) A high degree of vulnerability exists because of competitors' neglect of distribution
4) Distribution can enhance the firm by creating synergy from marketing channels

Also called sustainable competitive advantage, occurs when a firm attains a long-term, advantageous position in the market relative to competitors.

A firm that plans the channel and makes decisions by viewing the relationship with channel members as a partnership or strategic alliance that offers recognizable benefits to the manufacturer & channel members on a long-term basis

Positive but not linear

1) Decision made by marketers
2) development of new channels
3) modification of existing channels
4) allocation of distribution tasks in an attempt to deveolp an efficient structure
5) selection of channel members
6) strategic tool for gaining a differential advantage

Firms- Producers, Manufacturers, service providers, and franchisors. Look down the channel toward the market
Wholesalers- Look both up and down the channel
Retailers- Look up the channel to the secure suppliers

1) Recognize the need for the channel design decision
2) Set & coordinate distribution objectives
3) Specify distribution tasks
4) Develop alternative channel structures
5) Evaluate relevant variables
6) Choose the "best" channel structure
7) Select channel members

Firm’s overall objectives & strategies ß General marketing objectives & strategies ß Product, Pricing, Promotion and Distribution marketing objectives need to be congruent

# of levels = 2 to 5 or more
# of alternatives is limited to 2 or 3
Intensity at the various levels is the relationship between the intensity of distribution dimensions & number of retail intermediaries used in a given market area
Intensity # of intermediaries (retail level)
Intense Many
Selective Few
Exclusive One
Types of intermediaries = numerous types
Managers emphasis on types of distribution tasks performed by these intermediaries

Market Variables - Geography, Size, Density, Behavior
Product Variables- Bulk & weight, Perishability, Unit Value, degree of standardization, Technical vs. Non-technical, newness
Company Variables- Size, financial capacity, Managerial expertise
Intermediary Variables- Availability, Costs, Services Offered

1) firms replace channel members that have left
2) firms may need additional outlets to allow for growth

The greater the intensity of distribution the less the emphasis on selection

1. Field sales organization
2. Trade sources
3. Reseller inquiries
4. Customers
5. Advertising
6. Trade shows
7. Other sources

Selection Criteria
1) Credit & Financial Condition
2) Sales Strength
3) Product Lines

1) Good, profitable product line
2) Advertising and promotional supports
3) Management assitance
4) Fair dealign & friendly relationships