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59 Cards in this Set
- Front
- Back
VERTICAL MARKETING SYSTEM (VMS)
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CONSISTS OF PRODUCERS, WHOLESALERS, & RETAILERS ACTING AS A UNIFIED SYSTEM; CAN BE DOMINATED BY ANY ENTITY; CAME INTO BEING TO CONTROL CHANNEL BEHAVIOR & MANAGE CHANNEL CONFLICT
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CORPORATE VMS
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COMBINES SUCCESSIVE STAGES OF PRODUCTION & DISTRIBUTION UNDER SINGLE OWNERSHIP
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VERTICAL CONFLICT
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CONFLICTS BETWEEN DIFFERENT LEVELS OF THE SAME CHANNEL
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3 MAJOR TYPES OF VMS
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1.CORPORATE
2.CONTRACTUAL 3.ADMINISTERED |
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CONTRACTUAL VMS
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CONSISTS OF INDEPENDENT FIRMS AT DIFFERENT LEVELS OF PRODUCTION & DISTRIBUTION WHO JOIN TOGETHER THROUGH CONTRACTS TO OBTAIN MORE ECONOMIES OR SALES IMPACT THAN EACH COULD ACHIEVE ALONE
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CONVENTION DISTRIBUTION CHANNELS
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LOOSE COLLECTIONS OF INDEPENDENT COMPANIES; EACH SHOWING LITTLE CONCERN FOR OVERALL CHANNEL PERFORMANCE; LACK STRONG LEADERSHIP & HAVE BEEN TROUBLED BY DAMAGING CONFLICT & POOR PERFORMANCE
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4 MAJOR QUESTIONS REGARDING DISTRIBUTION CHANNELS
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1.WHAT IS THE NATURE?
2.HOW DO CHANNEL FIRMS ORGANIZE TO DO THE WORK OF THE CHANNEL? 3.WHAT PROBLEMS DO COMPANIES FACE IN DESIGNING CHANNELS? 4.WHAT ROLE DOES PHYSICAL DISTRIBUTION PLAY IN ATTRACTING & SATISFYING CUSTOMERS? |
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WHY DO PRODUCERS USE INTERMEDIARIES?
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1.CONTACTS
2.EXPERIENCE 3.SPECIALIZATION 4.SCALE OF OPERATION |
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FUNCTIONS OF THE MARKETING CHANNEL IN COMPLETING TRANSACTIONS
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1.INFORMATION
2.PROMOTION 3.CONTACT 4.MATCHING 5.NEGOTIATION |
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FUNCTIONS OF THE MARKETING CHANNEL IN FULFILLING COMPLETED TRANSACTIONS
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1.PHYSICAL DISTRIBUTION
2.FINANCING 3.RISK TAKING |
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CHANNEL LEVEL
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EACH LAYER OF MARKETING INTERMEDIARIES THAT PERFORMS SOME WORK IN BRINGING THE PRODUCT CLOSER TO THE FINAL BUYER
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DIRECT MARKETING CHANNEL
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NO INTERMEDIARY LEVELS, CONSISTS OF A COMPANY SELLING DIRECTLY TO CONSUMERS
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INDIRECT MARKETING CHANNEL
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CHANNEL CONTAINING ONE OR MORE INTERMEDIARY LEVELS
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CONSUMER DISTRIBUTION CHANNELS
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1.DIRECT MARKETING CHANNEL
2.1 INTERMEDIARY LEVEL (RETAILER) 3.2 INTERMEDIARY LEVELS (WHOLESALER & RETAILER) 4.3 INTERMEDIARY LEVELS (WHOLESALER, JOBBER, RETAILER) |
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TYPES OF FLOWS
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1.PHYSICAL FLOW OF PRODUCTS
2.FLOW OF OWNERSHIP 3.PAYMENT FLOW 4.INFORMATION FLOW 5.PROMOTION FLOW |
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CHANNEL CONFLICT
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DISAGREEMENT AMONG MARKETING CHANNEL MEMBERS ON GOALS & ROLES--WHO SHOULD DO WHAT & FOR WHAT REWARDS
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HORIZONTAL CONFLICT
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OCCURS AMONG FIRMS AT THE SAME LEVEL OF THE CHANNEL
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3 TYPES OF CONTRACTUAL VMSs
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1.WHOLESALER-SPONSORED VOLUNTARY CHAINS
2.RETAILER COOPERATIVES 3.FRANCHISE ORGANIZATIONS |
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WHOLESALER SPONSORED VOLUNTARY CHAINS
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WHOLESALERS ORGANIZE VOLUNTARY CHAINS OF INDEPENDENT RETAILERS TO HELP THEM COMPETE WITH LARGE CHAIN ORGANIZATIONS
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RETAILER COOPERATIVES
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RETAILERS ORGANIZE A NEW JOINTLY OWNED BUSINESS TO CARRY ON WHOLESALING & POSSIBLY PRODUCTION
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3 FORMS OF FRANCHISES
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1.MANUFACTURER-SPONSORED RETAILER FRANCHISE SYSTEM
2.MANUFACTURER-SPONSORED WHOLESALER FRANCHISE SYSTEM 3.SERVICE-FIRM-SPONSORED RETAILER FRANCHISE SYSTEM |
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ADMINISTERED VMS
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COORDINATES SUCCESSIVE STAGES OF PRODUCTION & DISTRIBUTION THROUGH THE SIZE & POWER OF 1 OF THE PARTIES, LEADERSHIP IS ASSUMED BY 1 DOMINANT CHANNEL MEMBERS
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HORIZONTAL MARKETING SYSTEM
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2 OR MORE COMPANIES AT 1 LEVEL JOIN TOGETHER TO FOLLOW A NEW MARKETING OPPORTUNITY
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HYBRID MARKETING CHANNELS
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(MULTICHANNEL DISTRIBUTION SYSTEMS)OCCURS WHEN A SINGLE FIRM SETS UP 2 OR MORE MARKETING CHANNELS TO REACH 1 OR CUSTOMER SEGMENTS
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DISINTERMEDIATION
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THE ELIMINATION OF A LAYER OF INTERMEDIARIES FROM A MARKETING CHANNEL OR THE DISPLACEMENT OF TRADITIONAL RESELLERS BY RADICALLY NEW TYPES OF INTERMEDIARIES
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CUSTOMER VALUE DELIVERY SYSTEMS
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ANOTHER WAY TO THINK OF MARKETING CHANNELS, IN WHICH EACH CHANNEL ADDS VALUE FOR THE CUSTOMER
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IDENTIFYING MAJOR ALTERNATIVES
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1.TYPES OF INTERMEDIARIES
2.NUMBER OF INTERMEDIARIES 3.RESPONSIBILITIES OF EACH CHANNEL MEMBER |
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TYPES OF CHANNEL MEMBERS
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1.COMPANY SALES FORCE
2.MANUFACTURER'S AGENCY 3.INDUSTRIAL DISTRIBUTORS |
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3 NUMBER OF MARKETING INTERMEDIARIES STRATEGY
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1.INTENSIVE DISTRIBUTION
2.EXCLUSIVE DISTRIBUTION 3.SELECTIVE DISTRIBUTION |
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INTENSIVE DISTRIBUTION
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STRATEGY IN WHICH COMPANIES STOCK THEIR PRODUCTS IN AS MANY OUTLETS AS POSSIBLE
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EXCLUSIVE DISTRIBUTION
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STRATEGY WHERE PRODUCERS PURPOSELY LIMIT THE NUMBER OF INTERMEDIARIES HANDLING THEIR PRODUCTS
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SELECTIVE DISTRIBUTION
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USE OF MORE THAN 1, BUT FEWER THAN ALL, OF THE INTERMEDIARIES WHO ARE WILLING TO CARRY A COMPANY'S PRODUCTS
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CHANNEL ALTERNATIVE EVALUATION CRITERIA
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1.ECONOMIC CRITERIA
2.CONTROL ISSUES 3.ADAPTIVE CRITERIA |
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ECONOMIC CRITERIA
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WHERE A COMPANY COMPARES THE LIKELY PROFITABILITY OF DIFFERENT CHANNEL ALTERNATIVES
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EXCLUSIVE DISTRIBUTION
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WHEN THE SELLER ALLOWS ONLY CERTAIN OUTLETS TO CARRY ITS PRODUCTS
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EXCLUSIVE DEALING
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WHEN THE SELLER REQUIRES THAT THESE DEALERS NOT HANDLE COMPETITORS PRODUCTS
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EXCLUSIVE TERRITORIAL AGREEMENTS
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WHERE THE PRODUCER MAY AGREE NOT TO SELL TO OTHER DEALERS IN A GIVEN AREA OR THE BUYER MAY AGREE TO SELL ONLY IN ITS OWN TERRITORY
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PHYSICAL DISTRIBUTION
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(MARKETING LOGISTICS) INVOLVES PLANNING, IMPLEMENTING, & CONTROLLING THE PHYSICAL FLOW OF MATERIALS & FINAL GOODS FROM POINTS OF ORIGIN TO POINTS OF CONSUMPTION TO MEET CUSTOMER REQUIREMENTS AT A PROFIT
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MARKET LOGISTICS THINKING
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STARTS WITH THE MARKETPLACE & WORKS BACKWARD TO THE FACTORY
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OUTBOUND DISTRIBUTION
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MOVING PRODUCTS FROM THE FACTORY TO CUSTOMERS
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INBOUND DISTRIBUTION
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MOVING PRODUCTS & MATERIALS FROM SUPPLIERS TO THE FACTORY
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2 PROBLEMS OF MARKET LOGISTICS
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1.OUTBOUND DISTRIBUTION
2.INBOUND DISTRIBUTION |
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SUPPLY CHAINS
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VALUE-ADDED FLOWS FROM SUPPLIERS TO FINAL USERS
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MAJOR LOGISTICS FUNCTIONS
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1.ORDER PROCESSING
2.WAREHOUSING 3.INVENTORY MANAGEMENT 4.TRANSPORTATION |
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STORAGE WAREHOUSES
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STORE GOODS FOR MODERATE TO LONG PERIODS
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DISTRIBUTION CENTERS
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DESIGNED TO MOVE GOODS RATHER THAN JUST STORE THEM
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5 TRANSPORTATION MODES
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1.RAIL
2.WATER 3.TRUCK 4.AIR 5.PIPELINE |
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INTERMODAL TRANSPORTATION
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COMBINING 2 OR MORE MODES OF TRANSPORTATION
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PIGGYBACK
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RAIL & TRUCKS
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FISHYBACK
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WATER & TRUCKS
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TRAINSHIP
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WATER & RAIL
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AIRTRUCK
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AIR & TRUCKS
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INTERGRATED LOGISTICS MANAGEMENT
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LOGISTICS CONCEPT THAT EMPHASIZES TEAMWORK, BOTH INSIDE THE COMPANY & AMONG ALL THE MARKETING CHANNEL ORGANIZATIONS, TO MAXIMIZE THE PERFORMANCE OF THE DISTRIBUTION SYSTEM
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CHANNEL PARTNERSHIPS
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1.CROSS-FUNCTIONAL, CROSS-COMPANY TEAMS
2.SHARED PROJECTS 3.INFORMATION SHARING 4.CONTINUOUS INVENTORY REPLENISHMENT SYSTEMS |
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REASONS FOR THIRD-PARTY LOGISTICS
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1.PROVIDERS CAN GET PRODUCT TO MARKET MORE EFFICIENTLY & AT LOWER COST THAN CLIENTS
2.OUTSOURCING LOGISTICS FREES A COMPANY TO FOCUS ON ITS CORE BUSINESS 3.INTEGRATED LOGISTICS COMPANIES UNDERSTAND INCREASINGLY COMPLEX LOGISTICS ENVIRONMENTS |
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FRANCHISE ORGANIZATIONS
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A CONTRACTUAL VMS IN WHICH A CHANNEL MEMBER, CALLED A FRANCHISER, LINKS SEVERAL STAGES IN THE PRODUCTION-DISTRIBUTION PROCESS
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DISTRIBUTION CHANNEL
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A SET OF ORGANIZATIONS INVOLVED IN THE PROCESS OF MAKING A PRODUCT AVAILABLE FOR CONSUMPTION BY THE CONSUMER OR BUSINESS USER
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THIRD PARTY LOGISTICS PROVIDERS
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AN INDEPENDENT LOGISTICS PROVIDER THAT PERFORMS ANY OR ALL OF THE FUNCTIONS REQUIRED TO GT THEIR CLIENTS' PRODUCT TO MARKET
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REASONS FOR GREATER EMPHASIS ON LOGISTICS
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1.CUSTOMER SERVICE & SATISFACTION HAVE BECOME THE CORNERSTONES OF MARKETING STRATEGY (DISTRIBUTION IS IMPORTANT ELEMENT)
2.LOGISTICS IS A MAJOR COST ELEMENT FOR MOST COMPANIES 3.EXPLOSION IN PRODUCT VARIETY HAS CREATED A NEED FOR IMPROVED LOGISTICS MANAGEMENT 4.IMPROVEMENTS IN INFORMATION TECHNOLOGY HAVE CREATED OPPORTUNITIES FOR MAJOR GAINS IN DISTRIBUTION EFFICIENCY |