Channel Marketing

Posted in Marketing and Strategy Terms, Total Reads: 1326
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Definition: Channel Marketing

Place is one of the important factor in the Marketing mix. It deals with process of making products available at the right quantities and at the right locations when the customer needs the product. Marketing channel helps in identifying the right method for making the products available. Channel marketing is intermediaries or series of firms involved in the flow of goods and services from the producer to the End user.


The Intermediaries involved in the process flow are

• Retailer

• Wholesaler

• Agents


These intermediaries improve efficiency in making products available to consumers, the intermediaries provide specialization, scale of operation and bring in new contact and also it helps in matching the supply and demand.


 

The channels are classified as Direct and Indirect channels. Direct channels are marketing channels which doesn’t use any intermediaries in the distribution process .It sells the products directly to the consumers for example Eureka Forbes Water purifier whereas in indirect marketing retailers, Wholesalers and Agents are involved in the distribution process. Most of the FMCG products are distributed through indirect channels like hub and spoke model which involves agents and dealers in the distribution process.


Dual Distribution Channel

Some companies use more than one channel in the distribution process to reach its target segment.


Example: Samsung products are sold directly through Samsung stores or through other dealers


Reverse Channel

These are the channels used for returning the goods to their producers. Increase in recalls, repairs and recycling programs establishing reverse channels are vital to the firm’s strategy. Almost all ecommerce firms offer return policies example Jabong offers 15 day return options.


 

Distribution intensities are classified as follows based on how the channels are used

• Intensive distribution—using all available channels

• Selective distribution—using limited channels

• Exclusive distribution—using single wholesaler or retailers

Many companies use more than one channel for the distribution. Hence there are possibilities of channel conflicts which should be managed properly through channel cooperation.

 

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