Alamna

Channel Design Decisions

Channel design decisions requires:

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Analyzing consumer needs

Setting channel objectives

Identifying major channel alternatives

Evaluating the major alternatives

1. Analyzing Consumer Needs

Designing a marketing channel starts with finding out what target customers want from

the channel

2. Setting channel objectives

Set it in terms of:

a. Targeted level of customer service

b. What segments to serve

c. Best channel to use

d. Minimizing the cost of meeting customer service requirements

Objectives are influenced by:

a. Nature of company

b. Products

c. Marketing intermediaries

d. Competitors

e. Environment

3. Identifying major channel alternatives

Types of intermediaries refers to channel members available to carry out channel work.

Examples include:

Company sales force

Manufacturer’s agency

Industrial distributors

Company sales force strategies:

a.

b.

c.

d.

Expand direct sales force

Assign outside salespeople to territories

Develop a separate sales force

Telesales

Number of marketing intermediaries to use at each level strategies:

a. Intensive distribution- is a strategy used by producers of convenience products and

common raw materials in which they stock their products in as many outlets as

possible

b. Exclusive distribution- is a strategy in which the producer gives only a limited

number of dealers the exclusive right to distribute its products in their territories

such as luxury automobiles and high-end apparel

c. Selective distribution- is a strategy when a producer uses more than one but fewer

than all of the intermediaries willing to carry the producer’s products such as

appliances and televisions.

Responsibilities of channel members

Producers and intermediaries need to agree on:

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Price policies

Conditions of sale

Territorial rights

Services provided by each party

4. Evaluating the major alternatives

Each alternative should be evaluated against:

a....