Marketing Environment and Distribution Channels (Essay Sample)
To correctly identify opportunities and threats to their product, marketing managers need to understand the marketing environment in which their products operate.
•Give an overview of the following distribution channels: ◦Channel levels: Direct versus indirect distribution
◦Channel organizations: Conventional, vertical, horizontal, and multichannel marketing systems
•Analyze your target market's needs, and explain what you know about your target market and what it wants from a channel of distribution.
•Determine which of the following channel members you will use, and explain why: ◦Indirect: Retailer, wholesaler, dealer, manufacturer's rep, and so forth
◦Direct: Catalog, telephone, sales force, and so forth
•Discuss how many channel members you will use (intensive distribution, exclusive distribution, or selective distribution), and explain why.
•Recommend a channel organization (conventional, vertical, horizontal, or multichannel marketing system), and explain why.
Your report must include a reference list. All research should be cited in the body of the paper. In-text citations and corresponding references should be included in your paper. For more information on APA style, please visit the APA lab. The paper should be written in third person, which means that pronouns like “I”, “we”, and “you” are not appropriate. The use of direct quotes is strongly discouraged.
Your assignment should contain a cover page, an abstract page, and a reference page in addition to the body. The body of the paper should be 2–3 pages in length, starting with a brief 1-paragraph introduction and ending with a short conclusion. The entire submission will be 5–6 pages in length.
Marketing Environment and Distribution Channels
Why marketing managers should understand their marketing environment?
Marketing environment of a business consists of all things which affect the manner in which the business operates. Business organizations can control some factors of the marketing environment, although some factors cannot be controlled (Solomon et al, 2013). It is important for marketing managers to have knowledge of their marketing environment in order to manage effects of negative factors and take advantage of positive factors. Marketing environment can be classified into micro environment, macro environment and internal environment. Business organizations should effectively identify all factors that constitute their marketing environment and make strategies how to manage such as factors for the benefits of their organizational activities.
Overview of distribution channels such as channel levels, direct versus indirect distribution, channel organizations, multichannel, vertical, conventional and horizontal marketing systems
Distribution channel refers to the paths that products move from manufacturers to customers or payments for such products move from customers to business people. Consumers and manufacturers are the two main market components. Keillor (2013) explains that intermediaries play a vital role of eliminating the distance between consumers and manufacturers. Channel level is the intermediary in the channels of marketing distribution between the manufacturers and consumers. There are various types of distribution channels. Each channel contributes a role in creating products available to consumers.
A direct channel (a zero level channel) refers to the direct marketing channel in which there is no intermediary; manufactures sells directly to the customers. Indirect channel refers to cases in which manufacturers use various intermediaries to sell products to consumers (Dent, 2011). A one-level channel consists of one intermediary normally a retailer between consumers and a manufacturer. A two-level channel and a three-level channel consist of two and three intermediaries in the respective order.
Channel organizations refer to the channels that businesses use to sell products to consumers depending on the appropriate channels that manufacturers use as suitable choices. There are several types of channel organizations. First, manufactures coordinate with wholesalers to purchase bulk products and sell such products in small bits to retail outlets (Dent, 2011). Secondly, manufactures can use agents to distribute products to consumers. The agents identify buyers for the manufactures and prepare product transactions. In this way, manufacturers pay commissions to agents for transactions made. Thirdly, manufacturers can create branch offices which sell products at designated places to reach customers at grassroots levels. Fourthly, manufacturers can coordinate with retailers to directly get products from the manufacturing companies to sell to consumers.
A market system refers to the network of manufacturers, distributors, consume...
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