MKT3343 Chapter 12

middleman, agent/broker, wholesaler, retailer, distributor, dealer

6 types of intermediaries:

Internet

Amazon and Orbitz are both part of _______ marketing channels.

strategic channel alliance

An agreement whereby the products of one organization are distributed through the marketing channels of another (ex: Kraft Foods distributes Starbucks coffee in US supermarkets and internationally)

time, place, form, possession

Consumers benefit from intermediaries through utilities:

assorting

Creating product assortments from several sources to serve customers

corporate vertical

Estee Lauder both manufactures MAC cosmetic products and owns the MAC retail stores. This is an example of a ________ marketing system.

intensive distribution

The highest level of distribution density is known as intensive (ex: gum, candy bars, soda)

Indirect

The presence of intermediaries suggests which type of marketing channel?

transactional function

buying, selling, risk taking

corporate vertical marketing system

the combination of successive stages of production and distribution under a single ownership

franchising

A contractual arrangement between a parent company and an individual or firm that allows them to operate a certain type of business under an established name and according to specific rules is called ______.

wholesaler

A firm that would typically be called a(n) ________ in consumer markets would perform the same functions as a distributor in business markets.

corporate vertical

A manufacturer that also owns distribution centers and retail outlets is an example of a _______ marketing system.

channel

A marketing ________ consists of those individuals or firms involved in the process of making products available to consumers or industrial users.

reordering

A quick response delivery system increases the efficiency of which of the following processes?

a supply chain

A sequence of firms that perform activities required to create and deliver a product or service to ultimate consumers or industrial users is known as ______.

place utility

Adding value to products by having them where people want them.

retailer

An intermediary who sells to consumers

two channel members

Channel conflict occurs between

total logistics costs

Expenses associated with transportation, materials handling and warehousing, inventory, stockouts, order processing, and return goods handling are included in ______.

wholesalers

Firms that buy products from manufacturers and resell them to retailers are known as

dual distribution

GE sells its large appliances directly to home and apartment builders but uses retail stores like Lowe's to sell to consumers, in a strategy known as ______.

one

One difference between intensive and exclusive distribution is that the latter uses ________ retailer(s) in a specified geographical area.

Internet marketing channels

Opentable.com is a reservation mechanism for restaurants. It uses the Internet to allow consumers to reserve tables in many places throughout the United States. It is an example of

forward integration

PRIMARILY a manufacturer but owns SOME distribution channels for its main products (ex: Ralph Lauren manufactures clothing and owns apparel shops)

intensive

The 1 million ATM machines owned by Visa are an example of Visa's strategy to provide a(n) _______ distribution of cash.

its supply chain

The combination of a firm's supplier network and its marketing channel is known as

retail services to ultimate consumers

The difference between a Service sponsored franchise system and the Service-sponsored retail franchise systems is that Service sponsored franchise systems may include franchises that do not offer:

possession utility

The exchange of a product for money

exclusive distribution

The most limited level of distribution density, one common among luxury brands (ex: Rolex), is known as

minimize logistics costs; maximum customer service

The objective of logistics management in a customer-driven supply chain is to ________ while delivering ________.

logistics

Those activities that focus on getting right amount of the right products to the right place at the right time at the lowest possible cost are known as

financing

To buy an item with credit; paying over time

contractual vertical

Under a ________ marketing system, independent production and distribution firms integrate their efforts on a contractual basis to obtain greater functional economies and marketing impact than they could achieve alone.

quick response delivery system

Using electronic data and inventory systems to make the process of reordering and receiving products as simple as possible is known as a(n) ______.

Multichannel marketing

What is the correct term for marketing that exploits opportunities with both traditional intermediaries and online?

exclusive

When Martha Stewart's products are found only at Macy's, it is an example of ________ distribution.

channel conflict

When one channel member believes another channel member is engaged in behavior that prevents it from achieving its goals, ________ arises.

The supplier network and flow of raw materials and parts

Which of the following are included in the inbound portion of the supply chain of a product?

agent or broker

Which of the following are intermediaries that have legal authority to act on behalf of a manufacturer?

Indirect channels are longer than direct ones

Which statement is TRUE about marketing channels?

responsive and efficient

Which two best describe effective choices for designing a supply chain that meets customer requirements and aligns with strategy?

order cycle, replenishment time

Which two of the following refer to the time between ordering an item and when it is received and ready for use or sale (choose 2).

wholesalers

Who shares the risk with the producers when they stock merchandise in anticipation of sales?

contractual vertical

Wholesaler-sponsored voluntary chains and retailer-sponsored cooperatives are two types of ________ marketing systems.

other intermediaries

Wholesalers are intermediaries who sell to

Supply chains

________ are typically designed to be either responsive or efficient, depending upon a firm's strategy to meet customer requirements.

Logistics

________ costs like transportation and order processing of sales are a large part, estimated at 25 to 30 percent, of the retail cost of an automobile.

A marketing channel

________ makes possible the flow of goods from a producer, through intermediaries, to a buyer.

Total logistics costs

________ must be balanced with the four customer service factors of time, dependability, communication, and convenience.

Customer service

________, as it pertains to a supply chain, is the ability to satisfy users in terms of time, dependability, communication, and convenience.

multichannel

_______________ marketing is the blending of different communication and delivery channels that are mutually reinforcing in attracting, retaining, and building relationships with consumers who shop and buy in traditional intermediaries and online.

backward integration

a business that is PRIMARILY a retailer but has some manufacturing capacity (ex: HEB is a retailer of a variety of brands but also has their own products that they sell that they also make)

horizontal conflict

a channel conflict that occurs among channel members on the same level

vertical conflict

a channel conflict that occurs between different levels in a marketing channel, most typically between the manufacturer and wholesaler or between the manufacturer and retailer

direct channel

a distribution channel in which producers sell directly to consumers (Shwan Food delivering directly to consumers)

selective distribution

a firm selects a few retailers in a specific geographical area to carry its products

channel captain

a manager who helps direct the activities of a whole channel and tries to avoid or solve channel conflicts

dealer

a more imprecise term than distributor that can mean the same as distributor, retailer, wholesaler, and so forth

cross-docking

a practice that involves unloading products from suppliers, sorting products for individual stores, and quickly reloading products onto its trucks for a particular store

direct marketing channels

allow consumers to buy products by interacting with various advertising media without a face-to-face meeting with a salesperson

dual distribution

an arrangement whereby a firm reaches different buyers by employing two or more different types of channels for the same basic product (GE sells its large appliances directly to home and apartment builders but uses retail stores, include Lowe's, to sell to consumers)

merchant wholesaler

an independently owned wholesale business that takes title (owns) to the merchandise it handles. They are classified as either general merchandise or specialty merchandise wholesalers.

middleman

any intermediary between the manufacturer and end-user markets

marketing channel

consists of individuals and firms involved in the process of making a product or service available for use or consumption by consumers or industrial users

Logistics

deals with decisions needed to move a product from the source of raw materials to consumption.

Manufacturer-sponsored wholesale franchise systems

exist in the soft-drink industry. For example, Pepsi-Cola licenses wholesalers (bottlers) that purchase concentrate from Pepsi-Cola and then carbonate, bottle, promote, and distribute its products to retailers and restaurants.

facilitating function

financing, grading, marketing information and research

logistical function

gathering, sorting, and dispersing products -assorting, storing, sorting, transporting

contractual vertical marketing system

independent production and distribution firms integrate their efforts on a contractual basis to obtain greater functional economies and marketing impact than they could achieve alone

indirect channel

intermediaries are inserted between the producer and consumers and perform numerous channel functions (ex: Toyota -> local car dealer -> consumer)

distributor

intermediaries who perform a variety of distribution functions, including selling, maintaining inventories, extending credit, and so on; a more common term in business markets but may also be used to refer to wholesalers

vertical marketing system

professionally managed and centrally coordinated marketing channels designed to achieve channel economies and maximum marketing impact

Manufacturer-sponsored retail franchise systems

prominent in the automobile industry, where a manufacturer such as Ford licenses dealers to sell its cars subject to various sales and service conditions

sorting

purchasing in large quantities and breaking into smaller amounts desired by customers

supply chain

refers to the individual firms involved in performing the activities required to create and deliver a product or service to consumers or industrial users

responsive supply chain

relies on more expensive express transportation for receipt of components from suppliers and delivery of finished products to customers (Dell)

efficient supply chain

seeks to keep costs low (Walmart)

multichannel marketing

the blending of different communication and delivery channels that are mutually reinforcing in attracting, retaining, and building relationships with consumers who shop and buy in traditional intermediaries and online (omnichannel marketing) - example, purchasing something online and picking it up in store

disintermediation

the cutting out of marketing channel intermediaries by product or service producers or the displacement of traditional resellers by radical new types of intermediaries

time utility

the increase in customer satisfaction gained by making a good or service available at the appropriate time

reverse logistics

the process of reclaiming recyclable and reusable materials for repair, redistribution, or disposal

vendor managed inventory

the supplier determines the product amount and assortment a customer needs and automatically delivers the appropriate items

replenishment time

the time between ordering an item and when it is available for use or sale

form utility

the value producers add to materials in the creation of finished goods and services

Service-sponsored retail franchise systems

used by firms that have designed a unique approach for performing a service and wish to profit by selling the franchise to others (ex: Holiday Inn, Avis, and McDonald's)

Service-sponsored franchise systems

when franchisors license individuals or firms to dispense a service under a trade name and according to specific guidelines (ex: employment services, H&R Block tax services)