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Marketing Channels - Definition, Types and Examples

In this discussion we will learn about marketing channels. marketing channel is a group of organizations that are interdependent and have various functions and are involved in the process of making goods or services provided for use or consumption by end users.


Marketing channels can also turn potential buyers into profitable customers, so that companies not only serve the market but must shape the market.



Marketing Channels - Definition, Types and Examples


Kotler (2006) in his book suggests that there are two strategies that are often used by companies in managing marketing channels, namely the push strategy and pull strategy. The push strategy is carried out by persuading intermediaries to market the product along with the provision of certain facilities.


This strategy is suitable for new products with limited promotional funds. While the pull strategy is carried out by building product positioning through promotion to consumers using advertising media.


Next we will talk about an example of a marketing funnel. Basically, the marketing channel serves to move goods from producers to consumers. There are five streams of marketing channels that are divided into three groups, namely:


  • Flow of information and promotion occurs in two directions
  • Flow in physical form, property rights and also in the form of company promotions to customers,
  • Flows with forms of payment from customers to companies.
  • In addition there are three examples of marketing channels, including:


Consumer Marketing Channels

This channel is a common type of channel between companies and consumers. These types of channels are divided into intermediate tiers:


  • Zero level channel. As the name implies, companies that implement a zero-level channel sell their goods directly to consumers. These sales can be made through door-to-door promotions, advertisements on TV (home shopping), the internet, etc.


  • Level one channel. Companies that implement tier one channels sell their goods not directly to consumers, but to retailers.


  • Second level channel. Companies that implement tier one channels sell their goods to retailers and wholesalers.

  • Three-level channel. Companies that implement tier one channels sell their goods to retailers, wholesalers, and wholesalers.


Industrial Marketing Channels

This channel is almost the same as the consumer marketing channel, it's just that those who act as consumers are industrial consumers. Who are the industrial customers? Industrial customers are factories that will process goods from the company into finished goods. Industry marketing channels are divided into four levels, including:


  • Zero level channel. These channels supply goods produced by manufacturers directly to industrial customers.

  • Level one channel. This channel distributes goods produced by producers to industrial customers with the distributor as the intermediary.


  • Second level channel. This channel distributes goods produced by producers to industrial customers with producer representatives and industrial distributors acting as intermediaries.


  • Three-level channel. This channel distributes goods produced by manufacturers to industrial customers with sales branches, industry representatives and industrial distributors acting as intermediaries.


Related - What is Marketing Plan - Explanation and In-depth Discussion


Service Sector Marketing Channels

Apart from physically distributing goods, marketing channels can also distribute services. In this case, service producers and problem-solving ideas are available and accessible to certain populations in need.


Before determining the type of marketing channels you will implement for your business, it's a good idea to choose a distribution strategy first. The distribution strategy is a strategy carried out by the company in accordance with the purpose of making the product. 


Exclusive distribution

This strategy is carried out by limiting the number of product intermediaries to maintain product exclusivity, so that product prices remain high. Companies that apply an exclusive distribution type which states that there is an agreement between producer and the main intermediary as the license holder. In addition, the sales system is carried out by maintaining the image of the product so that prices do not fall.


Selective Distribution

This strategy is carried out by involving several intermediaries who reach wide marketing reach (network) to work with company. Thus, the company does not need to install outlets everywhere because it is inefficient and reduces prices.


Intensive Distribution

Unlike the previous two strategies, an intensive distribution strategy to increase product sales is the goal. That is why the company involves many intermediaries in marketing its products. The risk of implementing this strategy lies in the high possibility of price wars between outlets because each outlet competes for customers with the same product.


Thus discussion of the meaning and examples of channel marketing. May be useful.

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