DECISIONS BY INTERNATIONAL MARKETERS IN DESIGNING OPTIMAL CHANNELS SYSTEM
I am not a marketer but having taken a minor course in International Marketing while at the university, I know one or two concepts in this important subject. I happened to lead a finance department for more than 8 years in a major film production house in Kenya. One of the areas that I got very much interested is where we would sell our shows. Distribution channels were limited and entries into the available one were not easy.
First off, A marketing channel is ‘an organized network of agencies and institutions which, in combination, perform all the activities required to link producers with users to accomplish the marketing task’. This channel must be designed such that it delivers a level of value to the customer that creates a sustainable competitive advantage for the supply chain. This ‘value’ can take many forms depending upon the requirements of the customer. The relationship between the value of the product and the shopping experience is particularly important and the skill of the value chain is in the positioning of the total offer in a profitable way.
Here are a few I factors I got to see our marketing gurus consider and explore:
Market factors: Market factors such as geographical distances and concentration, extensive technical knowledge and regular servicing required, small or large orders influences which channel to use in international marketing.
Product factors: The marketer should consider factors associated with the product like perishable, complexity of the product, how expensive the product is. In this strength the marketer will be in a better position to determine what channels system t use.
Producer factors: Producer decisions like availability of adequate resources to perform channel functions, broad product line and channel control importance are decisions the marketer should look into.
Competitive Factors: A decision whether the manufacture or service producer fees satisfied with marketing intermediaries in promoting his products. This determines how long a channel system will be.
Customer requirements: Some customers require mandate a direct relationship with the vendor to ensure their needs are met. In some cases, when an account insists on going direct, the reseller can still earn a bounty for delivering the qualified, pre-sold lead.
Ability to manage resellers. Much of the decision to go direct or indirect is also dependent on the companies’ ability to understand how the channel functions, come up with a competitive program, and manage the reseller programs and relationships.