What is Consumer Marketing Channels ?

Consumer Marketing Channels

• 0-level: Manufacturer to Consumer
• 1-level: Manufacturer to Retailer to Consumer
• 2-level: Manufacturer to Wholesaler to Retailer to Consumer
• 3-level: Manufacturer to Wholesaler to Jobber to Retailer to Consumer

Industrial Marketing Channels

• 0-level: Manufacturer to Industrial Customer
• 1-level: Manufacturer to Industrial Distributors to Industrial Customer
• 2-level: Manufacturer to Manufacturer's Representative to Industrial Distributors to Industrial Customer OR Manufacturer to Manufacturer's Sales Branch to Industrial Customer
• 3-level: Manufacturer to Manufacturer's Sales Branch to Industrial Distributors to Industrial Customer

Criteria for Selecting a Channel

1. Analyzing Customer Needs

• Value provided to the customer by each delivery network.
• Studying customer requirements and the need for more channels.

2. Setting Channel Objectives

• Identifying segments requiring different service levels and the best channels for them.
• Considering the nature of products (e.g., perishable goods require avoiding delays).
• Considering competitors (e.g., competing in the same area to facilitate comparison shopping).
• Environmental factors like economic conditions.

3. Identifying Major Alternatives

Type of Intermediaries: Selecting the specific type of intermediaries required.

• Finalizing the degree of channels required.
• Example: Dell's shift from D2C to multi-channel distribution.
• Using multi-channels to reach more customers (though they may target the same customer). Number of Marketing Intermediaries:
• Intensive Distribution: Stocking products in as many outlets as possible (e.g., convenience products).
• Exclusive Distribution: Giving a limited number of dealers the exclusive right to distribute the company's products in their territories (e.g., luxury brands).
• Selective Distribution: Using more than one, but fewer than all, intermediaries willing to carry the company's products (e.g., furniture brands, jewelry).

4. Evaluating Major Alternatives

• Economic Criteria: Comparing costs, expected sales, and profitability of different channel alternatives.
• Control Issues: Determining the level of control that needs to be given to the channels. The company aims to have as much control as possible.
• Adaptability Criteria: Ensuring new channel development doesn't negatively impact the profitability of existing channels, as channels involve long-term commitments.