Distribution Management and Sales Promotion:Sales Techniques for Consumer and Industrial Users, Channel functions and Flows, Channel Levels, Channel Management Decision- Communication mix- Sales force management- Promotinal Mix- Communication Strategies.

It includes all activites concerned with the efficient movement of goods from the place of prodction to the place of consumption. It includes wide range of inter-related activies which includes order process, inventory management , storage and transportation etc.Main objectives are1.Consumer satisfaction 2. Profit orientation

Placing Decision

Topics will be Covered

Distribution Channels

DefinitionsComponentsFuntionsNature and importance of channels Channel behavior & organization Channel design decisions Channel Management decisions

Distribution Channels

Definitions:“ A channel of distribution or marketing channel is the structure of intra company organisation units and extra company agents & dealers, wholesale and retail through which a commodity, product or service is marketed” ----American Marketing Association

“Distribution Channel is a set of interdependent organisation involved in the process of making a product or service available for use or comsumtion by consumer or business use”. ----Phillip Kotler

Producers produce fewer products in large quantities and customers want more product in smaller quantities and broader assortments wanted by the customers and break them into smaller and broader assortments wanted by the customers

Distribution Channel for Consumer Marketing ChannelDistribution Channel for Industrial Goods

Information(Customers, Competitors and others)

PromotionContact(Finding and communicating

with prospective buyers)MatchingTranferingOrder (Backward Communication)FinancingRisk Taking(Take the risks of carying

the work)Physical Flow(Producer to Competitors)Title

Distribution Channel Functions

Nature and Importance of Channels

Most businesses use third parties or intermediaries to bring their products to market.

They try to forge a "distribution channel" which can be defined as “All the organizations through which a product must pass between its point of production and consumption“

Why does a business give the job of selling its products to intermediaries?

The answer lies in efficiency of distribution costs. Intermediaries are specialists in selling. They have the contacts, experience and scale of operation which means that greater sales can be achieved than if the producing business tried to run a sales operation itself.

Channel Design Decision

Consumer is interested in different services from the company and the channel must deliver value to the consumer. We need to identify his needs and satisfy it.

Consumer convenience, the mode of delivery, credit, service, installation, place of purchase, type of product assorment. All these factors required here.

Understand the consumer requirements:

Nature of the company, product characteristics, type of channel memebers, competitors and the prevailing business envornment should be considered by the company.

Legal conditions and macro ecnomic situation of the country should also be considered. It is based on PLC

Framing channel objectives:

After setting the channel objectives the company should identify channel alternatives in terms of types of intermediaries, number of intermediaries, and the responsibilites of each member.

Types of Intermediaries: 1. Company Sales Force 2. Manufacturing Agency

3. Industrial Distributor(region wise ex: Supermarket, mail orders, exclusive show rooms)

Number of Marketing Intermediaries: 1. Intensive Distribution (Tooth paste inMany outlets) 2. Exclusion Distribution 3. Selective Distribution

Identifying Alternatives:

Number of Marketing Intermediaries: 1. Intensive Distribution (Tooth paste inMany outlets) 2. Exclusion Distribution

Identifying Alternatives:

Number of Marketing Intermediaries: 1. Selective

Identifying Alternatives:

Evaluating the Alternatives:The company should select the best

channel which will suit its long term objectives.

It should consider the factors like probability, share of control and adaptive nature of each of the channel

Cost of transaction is low for direct marketing channels like internet and telemarketing but value addtion also very low.

With direct sales channel like company sales force the cost per transtion is high and the value addition is high

Indirect channels like retailers, distributors the cost per transaction is moderate and the value addition is also moderate.

1. Horizontal Channel Conflicts2. Vertical Channel Conflicts 3. Multi Channel Conflicts

Channel Conflicts

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