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Transcript of Marketing Channels
1. Which channel and intermediaries will provide the best coverage of the target market?
2. Which channel and intermediaries will best satisfy the buy requirements of the target market?
3. Which channel and intermediaries will be most profitable?
In the United States, Target successfully manages their marketing channels and their supply chain
They decided to expand into Canada by opening 124 stores within the past year, in discount chain locations in Canada that were going out of business
Do you think Target was successful in their launch into Canada?
Traditional Marketing Channels
Non Traditional Marketing Channels
Vertical Marketing Channels- professionally managed and centrally coordinated marketing channels designed to achieve channel economies and maximum marketing impact
Improve efficiency and effectiveness
What is a Marketing Channel?
The firms and individuals involved in the process of making a product or service available for use or consumption by consumers or industrial users
They make possible the flow of products or services from a producer, through intermediaries, to a buyer
Manufacturer-sponsored wholesale franchise system
Coca- Cola licenses their bottling and distribution processes to other wholesalers
What happened in Target Canada?
Popular clothing brands in Target US stores did not follow Target into Canada
Compared to the discount chain they were replacing
Their channel choice in Canada did not provide the best coverage of the target market
They did not fully anticipate the buying requirements of the target market
Analysts expect Target to announce a loss of around $800 Million
For consumer products and services, direct and indirect
For business products and services, direct and indirect
Electronic Marketing Channels
Direct and Multichannel Marketing
Manufactures concentrate for drinks
Coca-Cola sends concentrate to bottling companies
The bottling companies then manufacture the drinks
The benefit of form utility is added with this step
The distribution company picks up drinks and distributes them to retailers, vending machines, etc.
The distribution company strives to be efficient and drive costs down
The benefits of place, time, and possession utility are added with this step
Coca-Cola products reach the consumer from retail outlets, vending machines, and other outlets
Direct vs. Indirect
Direct Marketing Channel- the producer and ultimate consumer deal directly with each other
Indirect Marketing Channel- intermediaries are inserted between the producer and consumer
The licensing of bottling and distribution allows Coca-Cola to have a greater marketing impact than if they undertook the entire operation on their own
The intermediaries add value at each step
Increased efficiency and profit
By optimizing delivery routes labor costs decreased by 15%
Amanda Stark & Nick Schlatz
There are many different marketing channel options
It is important to consider your target market when choosing a marketing channel in order for it to be efficient
Austen, I. (2014, February 24). Target Push Into Canada
Stumbles. The New York Times.
Chaffey, Dave. (2012, January 16). "Amazon.com Case Study." Smart
Hulligan, Brian. (2011, August 5). "3 Marketing Lessons From
Amazon's Web Strategy." Hubspot
Kant, Goos. Jacks, Michael. Aantjes, Corne. (2008) Coca-
Cola Enterprises Optimizes Vehicle Routes for Efficient Product Delivery
Ruiterman, Helga M. (2012, February 18). "Marketing Strategies
of Amazon.com." Marketing Plan
Example of an EMC
Founded in 1994
Online in 1995
Public in 1997
Why is Amazon so successful?
"Segments of One"
Amount of content
Take over web search