Hi, my name is xxxxxxx and this is xxxxx. Our talk is on Topic 10: Distribution strategies. The first question asked us to examine Marketing Distribution Channels.
Identify and describe the marketing distribution channel system currently being used by the company and product and highlight the types of wholesalers and/or retailers used.
A distribution channel can be defined as a set of interdependent organisations and firms that are involved in the process of directing products from producers to end consumers.
Marketing Intermediaries are an integral part of this process and can be seen as 'middlemen'. They are used to help the company promote, sell, and distribute its goods to other necessary intermediaries or ultimately - the final buyer, through contractual processes or purchase and resale; they include resellers, physical distribution firms, marketing service agencies, and financial intermediaries. In the case of Coke, intermediaries include supermarkets, delis, fast food chains etc.
Producers are willing to delegate some of the selling jobs to these intermediaries despite that fact they sacrifice some control over how where and to whom the product is sold. The use of intermediaries results in greater efficiency of supply of goods to the target markets. Due to experience and specialisation, intermediaries more often than not can help the firm achieve more than it could on it's own leading to greater economies of scale and better financial return.
Distribution channels vary in their channel level: each layer of marketing intermediaries involved in helping the producer reach the consumer comprises one level.
Direct Marketing Channels have zero intermediary levels.
(eg. Coca Cola vending machines as a means by which Coca Cola services the customer directly)
Indirect Marketing Channels have one or more levels
(eg. 1 level Coke - Dewsons - consumer
2-levels Coke - Toll Logistics - Woolworths - consumer...