chapter 15

types of utilities

Six types of utilities: Form Time Place Possession Information Service

Channel of Distribution

A group of marketing intermediaries that joining together to transport and store goods from producers to consumers.

types of marketing intermediares

Agents and Brokers -- Intermediaries who bring buyers and sellers together and assist in negotiating an exchange but do not take title to the goods. Wholesaler -- An intermediary that sells products to other organizations such as retailers, manufacturers, and hospitals. Retailer -- An organization that sells products to ultimate customers.

roles of agents and brokers

Agents generally maintain long-term relationships with the clients they represent. Manufacturer's agents represent several manufacturers in a specific territory. Sales agents represent a single client in a larger territory. Brokers usually represent clients on temporary basis.

the four systems of channel relationships

Corporate Distribution Systems: one firm owns all the organizations in a channel of distribution. Contractual Distribution Systems: members are bound to cooperate through contractual agreements. Administered Distribution Systems: producers manage all marketing functions at retail level. Supply Chains: all linked activities organizations must perform to move goods and services from source of raw materials to ultimate consumers.

forms of non store retailing

Electronic Retailing -- Selling goods and services to ultimate consumers online. Social Commerce Telemarketing -- Sale of goods and services via phone. Vending machines, kiosks and carts Direct Selling -- Selling goods and services to customers in their homes or workplaces. Multilevel marketing Direct Marketing -- Any activity that directly links manufacturers or intermediaries with ultimate customers.

marketing itermediaries

Marketing Intermediaries -- Organizations that assist in moving goods and services from businesses to businesses (B2B) and from businesses to consumers (B2C).

how marketers use utility

Form Utility -- Changes raw materials into useful products; producers generally provide form utility. Starbucks makes coffee the way the customers want it. Dell assembles computers according to customer needs. Time Utility -- Makes products available when customers want them. Many Walgreens stores are open 24-hours a day. Colleges offer day and evening classes. Place Utility -- Adds value to products by placing them where people want them. Banks place ATMs at convenient locations. 7-11 stores are found in easy-to-reach locations. Possession Utility -- Helps transfer ownership from one party to another, including providing credit. Pay for lunch at McDonalds with your Visa card. A savings and loan office offers loans to home/car buyers. Information Utility -- Opens two-way flows of information between marketing participants. Websites offer advice to shoppers. Local government maps show tourist locations. Service Utility -- Provides service during and after a sale and teaches customers how to best use products. Apple offers classes to help computer buyers. College placement offices help students find jobs.

logistics types

Inbound logistics Materials handling Outbound logistics Reverse logistics Third-party logistics

retail distribution strategy

Intensive Distribution -- Puts products into as many retail outlets as possible. Selective Distribution -- Uses only a preferred group of the available retailers in an area. Exclusive Distribution -- The use of only one retail outlet in a given geographic area.

why marketing needs intermediaries

Intermediaries perform marketing tasks faster and cheaper than most manufacturers could provide them. Intermediaries make markets more efficient by reducing transactions and contacts.

types of wholesale intermediaries

Merchant Wholesalers -- Independently owned firms that take title to the goods they handle. There are two types: Full-service wholesalers perform all distribution functions. Limited-function wholesalers perform only selected distribution functions. Rack Jobbers -- Furnish racks or shelves of merchandise such as music and magazines for retailers for display and sell them on consignment. Cash-and-Carry Wholesalers -- Serve mostly smaller retailers with a limited assortment of products. Drop Shippers -- Take orders from retailers and other wholesalers and have the merchandise shipped from producer to buyer.

freight forwarder

Puts many small shipments together to create a single large shipment that can be transported cost-effectively by truck or train.

storage warehouses

Storage warehouses hold products for a relatively long period of time. Distribution warehouses are used to gather and redistribute products such as: Beer and soft drinks Package deliveries Tracking goods done by UPC codes and RFID tags

logistics

The planning, implementing and controlling of the physical flow of material, final goods and related information from points of origin to points of consumption. Firms outsource to others specializing in trade compliance to determine what is needed to market products to global customers.

supply chain management

The process of managing the movement of raw materials, parts, work in progress, finished goods, and related information through all the organizations in the supply chain.

utility

The want-satisfying ability, or value, that organizations add to goods and services by making them more useful or accessible to consumers.

intermodal shipping

Uses multiple modes of transportation to complete a single long-distance movement of freight. Piggybacking Fishybacking Birdybacking

wholesale intermediaries

Wholesalers normally make B2B sales, however, stores like Staples and Costco also have retail functions. Retail sales are sales of goods and services to customers for their own use. Wholesale sales are sales of goods and services to other businesses for use in the business or resale. Consumers are more familiar with retailers than wholesalers.