Chapter 7 Marketing Management

What are collaborators?

Are entities that work with the company to create value for target customers

Collaborators aims to improve a company's ability to..

Create value for its target customers in a way that helps achieve its own strategic goals.

The key marketing principle...

Creating superior value for target customers in a way that benefits the company and its collaborators

Collaborators Conflicts

Vertical channel conflict- depicts tensions between entities in a single distribution channel Manufactor—> distributor__> Customer Horizontal channel conflict- involves tensions among entities in multiple distribution channels Manufactor—> distributors A—B—> customers

Alternatives to collaboration

Vertical integration- typically involves the acquisition of an entity occupying a different level in the value delivery chain. Forward integration= manufacture buying retail or Backward integration= retailer acquiring wholesaler Horizontal integration- involves acquiring a business entity at the same level of the value delivery chain.

Disadvantages of collaboration

-Loss of control- hinders the company ability to monitor production processes and product quality Loss of competencies- outsourcing weakens a company core competencies Empowering the competition- enable collaborating entities to develop a set of strategic competencies thus becoming a company potential competitor

Collaboration is a value-creation process it spans the process of...

-value-degisn collaboration -value-communicating collaboration -value-delivery collaboration

Advantages of collaboration

-Effectiveness- enables companies to specialize in a particular aspect of the value-delivery process ( RD, manufacturing and distributing) -Cost efficiency- specializing in a given function, each collaborator can achieve greater economies of scale and expertise -Flexibility- collaborators requires a lesser commitment of resources and hence offers much greater flexibility in terms of switching tech., entering new markets and exiting existing ones -Speed- using existing distributors

Levels of collaboration

Explicit collaboration- involves contractual relationships, such as long term contractual agreements, joint ventures, and franchise agreements Implicit collaboration- typically does not involve contractual relationships and is much more flexible than explicit collaboration