chapter 15, kotler, marketing management, top 10 concepts - designing and managing integrated marketing concepts

1. Crisostomo, Kathleen Lizette C.
MARKMA
CHAPTER 15:
DESIGNING AND MANAGING
INTEGRATED MARKETING CHANNELS

2. Top 10 Concepts
1. Marketing Channel System: Push and Pull
2. Categories of Buyers
3. Decisions in Designing a Marketing Channel System
4. Analyzing customer needs: Channel Service Outputs
5. Identifying Channel Alternatives: Three Elements
6. Channel-Management Decisions
7. Channel Power
8. Channel Integration and Systems
9. Channel Coordination / Channel Conflict
10. E-Commerce Marketing Practices

3. Top 10 Concepts
1. Marketing Channel System: Push and Pull
2. Categories of Buyers
3. Decisions in Designing a Marketing Channel System
4. Analyzing customer needs: Channel Service Outputs
5. Identifying Channel Alternatives: Three Elements
6. Channel-Management Decisions
7. Channel Power
8. Channel Integration and Systems
9. Channel Coordination / Channel Conflict
10. E-Commerce Marketing Practices

4. • Push strategy uses the manufacturer’s sales
force, trade promotion money, and other means
to induce intermediaries to carry, promote, and
sell the product to end users.
- used for low brand loyalty in categories or
impulse items

5. • A pull strategy uses advertising, promotion, and
other forms of communication to persuade
consumers to demand the product from
intermediaries.
- used when consumers can differentiate brands
well and brand are chosen prior to purchase

6. Top 10 Concepts
1. Marketing Channel System: Push and Pull
2. Categories of Buyers
3. Decisions in Designing a Marketing Channel System
4. Analyzing customer needs: Channel Service Outputs
5. Identifying Channel Alternatives: Three Elements
6. Channel-Management Decisions
7. Channel Power
8. Channel Integration and Systems
9. Channel Coordination / Channel Conflict
10. E-Commerce Marketing Practices

7. Categories of Buyers
• Habitual Buyers
• Same place, same manner
• High value deal seekers
• They know what they need and they
surf before buying at the lowest possible
price

8. Categories of Buyers
• Variety-loving shoppers
• Gather info through various channels,
take advantage of high-touch services,
then buy in their favorite channel
regardless of price
• High-involvement shoppers
• Gather info through alls channels and
purchase in a low cost channel but takes
advantage of customer support from a
high-touch channel

9. Top 10 Concepts
1. Marketing Channel System: Push and Pull
2. Categories of Buyers
3. Decisions in Designing a Marketing Channel System
4. Analyzing customer needs: Channel Service Outputs
5. Identifying Channel Alternatives: Three Elements
6. Channel-Management Decisions
7. Channel Power
8. Channel Integration and Systems
9. Channel Coordination / Channel Conflict
10. E-Commerce Marketing Practices

10. Decisions in Designing a
Marketing Channel System
A. Analyze customer needs
* Greater service = greater channel costs = higher prices

11. Decisions in Designing a
Marketing Channel System
A. Analyze customer needs
* Greater service = greater channel costs = higher prices
B. Establish channel objectives
* Which market segment to serve and what best
channel to use

12. Decisions in Designing a
Marketing Channel System
A. Analyze customer needs
* Greater service = greater channel costs = higher prices
B. Establish channel objectives
* Which market segment to serve and what best
channel to use
C. Identify major channel alternatives
* Each channel reaches a different segment and
delivers the right product at the least cost

13. Decisions in Designing a
Marketing Channel System
A. Analyze customer needs
* Greater service = greater channel costs = higher prices
B. Establish channel objectives
* Which market segment to serve and what best channel to
use
C. Identify major channel alternatives
* Each channel reaches a different segment and delivers the
right product at the least cost
D. Evaluate major channel alternative
* vs. economic, control and adaptive criteria

14. Top 10 Concepts
1. Marketing Channel System: Push and Pull
2. Categories of Buyers
3. Decisions in Designing a Marketing Channel System
4. Analyzing customer needs: Channel Service Outputs
5. Identifying Channel Alternatives: Three Elements
6. Channel-Management Decisions
7. Channel Power
8. Channel Integration and Systems
9. Channel Coordination / Channel Conflict
10. E-Commerce Marketing Practices

15. Analyzing customer needs:
Channel Service Outputs
– Lot size: How many can be purchased on 1
occasion?
?

16. Analyzing customer needs:
Channel Service Outputs
– Lot size: How many can be purchased on 1
occasion?
– Waiting and delivery time: The faster, the
better

17. Analyzing customer needs:
Channel Service Outputs
– Lot size: How many can be purchased on 1
occasion?
– Waiting and delivery time: The faster, the
better
– Spatial convenience: how easy is it to buy
the product?

18. Analyzing customer needs:
Channel Service Outputs
– Product variety: more choices = more
chances of finding what is needed

19. Analyzing customer needs:
Channel Service Outputs
– Service back-up: add-ons

20. Top 10 Concepts
1. Marketing Channel System: Push and Pull
2. Categories of Buyers
3. Decisions in Designing a Marketing Channel System
4. Analyzing customer needs: Channel Service Outputs
5. Identifying Channel Alternatives: Three Elements
6. Channel-Management Decisions
7. Channel Power
8. Channel Integration and Systems
9. Channel Coordination / Channel Conflict
10. E-Commerce Marketing Practices

21. Identifying Channel Alternatives:
Three Elements
1. Types of intermediaries
• Do I need a wholesaler? Retailer? Dealer?

22. Identifying Channel Alternatives:
Three Elements
1. Types of intermediaries
* Do I need a wholesaler? Retailer? Dealer?
2. Number of intermediaries
* Distribution: Exclusive? Selective? Intensive?
* Risk = price wars among retailers

23. Identifying Channel Alternatives:
Three Elements
1. Types of intermediaries
* Do I need a wholesaler? Retailer? Dealer?
2. Number of intermediaries
* Distribution: Exclusive? Selective? Intensive?
* Risk = price wars among retailers
3. Terms and responsibilities
* Respect + Opportunity to make profits

24. Top 10 Concepts
1. Marketing Channel System: Push and Pull
2. Categories of Buyers
3. Decisions in Designing a Marketing Channel System
4. Analyzing customer needs: Channel Service Outputs
5. Identifying Channel Alternatives: Three Elements
6. Channel-Management Decisions
7. Channel Power
8. Channel Integration and Systems
9. Channel Coordination / Channel Conflict
10. E-Commerce Marketing Practices

25. Channel-Management Decisions
Because to the customers, the channels are
Select the company!

26. Channel-Management Decisions
Because to the customers, the channels are
Select the company!
Train
Because intermediaries are partners in
satisfying customers!
Motivate

27. Channel-Management Decisions
Because to the customers, the channels are
Select the company!
Train
Because intermediaries are partners in
satisfying customers!
Motivate
Evaluate
Is the strategy still working? (external analysis
Modify and current channels)

28. Top 10 Concepts
1. Marketing Channel System: Push and Pull
2. Categories of Buyers
3. Decisions in Designing a Marketing Channel System
4. Analyzing customer needs: Channel Service Outputs
5. Identifying Channel Alternatives: Three Elements
6. Channel-Management Decisions
7. Channel Power
8. Channel Integration and Systems
9. Channel Coordination / Channel Conflict
10. E-Commerce Marketing Practices

29. • Channel Power is the ability to
alter channel’s behavior
• Cooperation is a huge challenge!

30. Channel Power
a. Coercive power
- Withdraw resource or terminate relationship
b. Reward power
- Extra benefit for performance
c. Legitimate power
- Behavior warranted under the contract
d. Expert power
- Must develop new expertise for them to cooperate
e. Referent power
- Respect causes intermediaries to have pride in the
association

31. Top 10 Concepts
1. Marketing Channel System: Push and Pull
2. Categories of Buyers
3. Decisions in Designing a Marketing Channel System
4. Analyzing customer needs: Channel Service Outputs
5. Identifying Channel Alternatives: Three Elements
6. Channel-Management Decisions
7. Channel Power
8. Channel Integration and Systems
9. Channel Coordination / Channel Conflict
10. E-Commerce Marketing Practices

32. Channel Integration and Systems
Vertical Marketing Systems
-Producer + Wholesaler + Retailer
= Unified system under channel
captain
- Corporate (single ownership),
administered or contractual
(independent firms)

33. Channel Integration and Systems
Vertical Marketing Systems
Horizontal - 2 or more unrelated
Marketing Systems companies put together
resources to exploit an
emerging market

34. Channel Integration and Systems
Vertical Marketing Systems
- More marketing
channels/ strategies of 1
Horizontal channel reflect the
Marketing Systems strategies of other
channels
- Goal: maximum market
Integrated Multichannel coverage
Marketing Systems

35. Top 10 Concepts
1. Marketing Channel System: Push and Pull
2. Categories of Buyers
3. Decisions in Designing a Marketing Channel System
4. Analyzing customer needs: Channel Service Outputs
5. Identifying Channel Alternatives: Three Elements
6. Channel-Management Decisions
7. Channel Power
8. Channel Integration and Systems
9. Channel Coordination / Channel Conflict
10. E-Commerce Marketing Practices

36. • Channel Coordination – channel
members are brought together to
advance the goals of the channel

37. • Channel conflict - one member’s
actions prevent another channel
from achieving its goal
* Can be vertical, horizontal or
multichannel

38. Top 10 Concepts
1. Marketing Channel System: Push and Pull
2. Categories of Buyers
3. Decisions in Designing a Marketing Channel System
4. Analyzing customer needs: Channel Service Outputs
5. Identifying Channel Alternatives: Three Elements
6. Channel-Management Decisions
7. Channel Power
8. Channel Integration and Systems
9. Channel Coordination / Channel Conflict
10. E-Commerce Marketing Practices

39. * Online retailers provide convenient,
informative and personalized experiences
without:
• Retail floor space
• Staff
• Inventory
* Customer service is critical: no social
interaction

40. E-Commerce Marketing Practices
Pure-click
Launched a website without any previous
experience as a firm

41. E-Commerce Marketing Practices
Pure-click
Launched a website without any previous
experience as a firm
Brick-and-click
- Existing companies with an added online site
- Risk: conflict with offline intermediaries