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channel management and its uses in distribution, Lecture notes of Marketing

distribution through channel management

Typology: Lecture notes

2018/2019

Uploaded on 11/15/2019

kumar-rishikesh
kumar-rishikesh 🇮🇳

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Chapter 9
Submitted by
Rajni Kumari
Jn180115
MOTIVATING THE CHANNEL MEMBERS
Objective
1. Understand the definition of the channel management
2. Find the difference between channel management and decisions and channel
design decisions.
Channel management – it can be defined as the administration of existing
channel to secure the cooperation of channel members in achieving the firm’s
distribution objectives.
Each member in a channel is an organization itself with its own marketing
objectives. Each of these firms strive to achieve its objectives like increase in
revenues, be a market leader, etc. The channel members should be viewed as
customers by the manufacturer. This way the manufacturer understands the needs
and challenges faced by the intermediaries and accordingly take steps that in the
best interest of the manufacturer as well as the intermediaries.
For smooth functioning of operations, clear policies and procedures should be
agreed upon and formally signed. If the policies and procedures are not clearly
shared and formally agreed to, the possibility of conflicts is high among channel
members.
Motivating channel members –An organization should sell the product to
intermediaries as a customer considering their needs and wants. This helps a
manufacturer achieve its objectives. It should cooperate and help the intermediaries
in every possible way with training programs, market surveys, etc. to improve their
performance.
The basic things require in motivation management are-
1. Finding out needs and the problems of channel members
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Chapter 9 Submitted by Rajni Kumari Jn

MOTIVATING THE CHANNEL MEMBERS

Objective

  1. Understand the definition of the channel management
  2. Find the difference between channel management and decisions and channel design decisions.

Channel management – it can be defined as the administration of existing channel to secure the cooperation of channel members in achieving the firm’s

distribution objectives.

Each member in a channel is an organization itself with its own marketing objectives. Each of these firms strive to achieve its objectives like increase in revenues, be a market leader, etc. The channel members should be viewed as customers by the manufacturer. This way the manufacturer understands the needs and challenges faced by the intermediaries and accordingly take steps that in the best interest of the manufacturer as well as the intermediaries.

For smooth functioning of operations, clear policies and procedures should be agreed upon and formally signed. If the policies and procedures are not clearly shared and formally agreed to, the possibility of conflicts is high among channel members.

Motivating channel members –An organization should sell the product to intermediaries as a customer considering their needs and wants. This helps a manufacturer achieve its objectives. It should cooperate and help the intermediaries in every possible way with training programs, market surveys, etc. to improve their performance.

The basic things require in motivation management are-

  1. Finding out needs and the problems of channel members
  1. Offering support to the channel members that is consistent with needs and problems.
  2. Providing leadership through the effective use of power

Approaches for learning about member needs and problems

  1. Research studies of channel members- this this very important to know that which kind of product the customer want, their brand preference and their shopping behavior they engage in and many more other information. Research studies help the manufacturer to know all the requirements of the customers and accordingly select the right channel partners. But less than 1% of the manufacture research budget are spent on channel member.
  2. (^) Research studies by the outside parties- research design and executed design by a third party who is not member if channel is sometimes necessary if complete and unbiased data on channel members need and the problem are to be obtained.
  3. Marketing channel audits- this approach is used to gather data on how channel members perceive the manufacture’s marketing program and its component parts, where the relationship are strong and weak and what is expected of the manufacture to make the relationship viable and optimal.
  4. Distributor advisory councils- another effective approach of learning about the channel members needs a problem is to setup distributor advisory council. These councils should consist of top management representatives from manufacturer as well as representatives of the principle from channel members. This advisory council provides recognition for channel members and helps in identifying and discussing mutual needs and problems that are not transmitted through the regular channel information flow. It also helps in improving the channel communication.

Offering Supports to Channel Members

  1. Co-operative arrangements- it has been used as the most common means of motivating channel members in loosely aligned channels. These arrangements are quite diverse are limited upon the creativity of the manufacturer distributor or retailer.
  2. Partnership and strategic alliances- It includes continuing and mutually supportive relationship between the manufacturer and its channel members and effort to provide a more highly motivated team, networks, or alliance of channel partners.
  3. Distribution Programming- it is a comprehensive set of politics for the promotion of a product through the channel. It virtually deals with all the aspects of the channel relationship. This offer all channel members the