12.9 Exercises
Review Questions
- Why are marketing channel decisions as important as pricing and product feature decisions?
- What are the benefits of looking at all of the organizations that contribute to the production of a product versus just the organizations that sell them?
- Why do channel partners rely on each other to sell their products and services?
- How do companies add value to products via their marketing channels?
- Why are direct marketing channels possible for some products and not others?
- Explain the value middlemen can add to products.
- Name some companies that have multiple marketing channels for their products. What are those channels?
- How do marketing channels differ around the world? Why is it sometimes hard for firms to penetrate foreign markets?
- Why are good channel decisions critical to a product’s success?
- Name the factors that affect channel-selection decisions.
- Which kinds of products are more likely to be distributed using exclusive marketing strategies?
- What gives some organizations more channel power than others?
- Why do channel conflicts occur?
- Which organization(s) has the most power to resolve channel conflicts?
- How can setting up vertical and horizontal marketing systems prevent channel conflicts?
- What’s the ideal number of marketing channels a firm should have?
- Is a pull strategy superior in all markets?
- Is selling power the only source of channel power? From what other sources could an organization derive channel power?
- The chapter listed a number of scenarios that can cause channel conflicts. What other factors can you think of that might cause channel conflicts?
- Amazon.com has carved out a unique niche for itself as an intermediary. Amazon sells products on behalf of manufacturers such as Dell, Sony, and Calvin Klein, as well as retailers such as Macy’s and Toys“R”Us. How should Amazon be categorized? As a retailer, wholesaler, or broker?
- What are some reasons for backward integration? For forward integration? Does such integration always benefit the consumer?
- Direct to consumer advertising for pharmaceuticals is a pull strategy, designed to get consumers to ask their doctors to prescribe certain medications. What are the pros and cons of this practice? Are these always pros and cons to pull strategies? What might the pros and cons be for push strategies involving pharmaceuticals?
- What are some brands that you think use selective or exclusive channels? How does channel choice, in those instances, influence consumer perceptions of value? In what situations might selective or exclusive channels add real value?
- Of the channel functions described in the chapter, which is the most important and why? The least important? Why?
- How does disintermediation benefit the consumer? How might it harm the consumer? Can you think of any revolutionary businesses created in the past few years due to disintermediation? Be sure to describe one not mentioned already in the chapter.
Activities
- Think of some products you currently use. Are there any you would like to buy via different marketing channels? Do you think the products could be successfully marketed this way?
- Describe a time in which you did business with a company and received conflicting information from its different channels (for example, a store’s web site versus a visit to the store). How did it affect your buying experience? Have you done business with the company since?
- Break into groups and make a list of four to five different types of products. Decide which channels should be used to distribute each product. Present your findings to your class and see if they agree with you.
- Make a list of products you believe failed because of poor marketing channel choices.
