1. Marketing Channels &
Distribution
• BY- RAVIRANJAN
KUMAR
• PGDM-1ST YEAR
• KCCITM

2. • Distribution is one of the classic “4 Ps” of
marketing (product, promotion, price,
placement a.k.a. “distribution”). It’s a key
element in your entire marketing strategy — it
helps you expand your reach and grow
revenue.
• B2B and B2C companies can sell through a
single channel or through multiple channels
that may include:
•

3. • Wholesaler/Distributor
• Direct/Internet
• Direct/Catalogue
• Direct/Sales Team
• Value-Added Reseller (VAR)
• Consultant
• Dealer
• Retail
• Sales Agent/Manufacturer’s Rep

4. Marketing Intermediaries
• • National, State, and
Travel Agents
Local Agencies
• Tour Wholesalers
• Consortia and
• Specialists Reservation Systems
• Hotel Reps • Global Distribution
• Concierges Systems
• Internet
©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition
Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

5. Marketing Intermediaries
Travel Agents
Travel Agents Tour Wholesalers
Tour Wholesalers
Specialists:
Specialists:
Concierges
Concierges Brokers & Junket Reps
Brokers & Junket Reps
Internet
Internet Hotel Representatives
Hotel Representatives
Global Distribution
Global Distribution National, State,
National, State,
Systems
Systems and Local Tour Agencies
and Local Tour Agencies
Consortia & Reservations
Consortia & Reservations
Systems
Systems
©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition
Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

6. The Importance of Marketing Channels
• Intermediaries make distribution and selling
processes more efficient.
• Intermediaries offers supply chain partners
more than they could achieve on their own.
– Market Exposure
– Technical Knowledge/Information Sharing
– Operational Specialization
– Scale of operation

7. Channel Efficiency: How Intermediaries Reduce the Number of
Channel Transactions

8. Other Key Channel Functions
• Matching Needs with Products
• Physical distribution & Logistics
• Financing
• Risk taking

9. Customer Marketing Channels
Customer Marketing Channels
©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition
Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

10. Conventional vs. Vertical Marketing
Channels
©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition
Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

11. Franchising
• Granting the right to engage in offering, selling, or
distributing goods or services under a marketing
format which is designed by the franchisor
• The franchisor permits the franchisee to use its
trademark, name, and advertising
• Higher survival rates
©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition
Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

12. Franchisee – Advantages
Marketing
Brand Name Support
Contracts
Reservation systems-
Plans and Customers
Systems
©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition
Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

13. Franchisee – Disadvantages
• Value of brand name determined by
franchiser
• Introduction of new products determined by
franchiser
• Your reliability tied to the rest of the system
©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition
Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

14. A Franchise is Only as Strong as
–
Brand Name
Market demand for Competitive Advantage
the product system
©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition
Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

15. Distribution Strategy Alternatives
• How many intermediaries?
– Intensive distribution
• Stock product in as many outlets as possible.
– Exclusive distribution
• Granting a limited number of outlets the exclusive right
to sell product.
– Selective distribution
• Somewhere in between Intensive and Exclusive
Distribution.
Does the company always get to choose?

16. FACTORS INFLUENCE
• The following factors influence the choice of
distribution channels by a business.
Market factors
An important market factor is "buyer
behaviour"; how do buyer's want to purchase
the product? Do they prefer to buy from
retailers, locally, via mail order or perhaps
over the Internet?

17. • Producer factors:
A key question is whether the producer have
the resources to perform the functions of the
channel? For example a producer may not
have the resources to recruit, train and equip
a sales team. If so, the only option may be to
use agents and/or other distributors.
Producers may also feel that they do not
possess the customer-based skills to distribute
their products.

18. • Product factors:
Large complex products are often supplied
direct to customers (e.g. complex medical
equipment sold to hospitals). By contrast
perishable products (such as frozen food,
meat, bread) require relatively short
distribution channels - ideally suited to using
intermediaries such as retailers

19. THANK YOU