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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.
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