A Marketing Channel can be defined as a "set of organizations involved in the process of making a product available for use or consumption by the end user" (McColl - Kennedy, Kiel, Lusch, 1994). The marketing channel overcomes the major time, place and possession gaps that separate goods and services from those who would use them. Most producers use intermediaries, in order to provide their target markets, products and/or services they need through an effective distribution channel, so intermediaries can also be called "channel members". In one hand, these channel members help companies to do economies by reducing the number of transactions (see figure 1) and providing their experience, contacts, and achieving more than these companies can. On the other hand, it also means giving up some control of how, and to whom products are sold.
Marketing ChannelGeneric Functions
Moreover, the marketing channel is characterised by different functions. Traditionally, channel members exist in channel arrangements to perform one or more of the following generic functions: "promote, generate demand, physical distribution, carry inventory (storage) and financing" (Stern, El-Ansary and Coughlan 1996);
Promote deals with providing information to customers by promoting products, including competitive conditions and trends.
Basically, this function is one part of the "4 Ps": Promotion, this includes advertising, telemarketing, and direct mails - everything to let the world knows about your products and/or services and then generates the demand (Kotler, Amstrong 2003).
The Generate demand (Sell) function is about contracting potential customers and soliciting orders. It can be perceived as a direct result of the demand generation (Gatorna 2003).
Physical distribution can be defined as moving products from production to consumer, overcoming temporal discrepancies and spatial discrepancies. It means that marketing can create customer demand by promoting or selling the product but the goods still need to be...