marketing 3 exam
Financing.
Acquiring and using funds to cover the costs of the channel work
exclusive distribution
Breitling watches—positioned as "Instruments for Professionals" and selling at prices from $5,000 to more than $100,000—are sold by only a few authorized dealers in any given market area.
adaptability criteria.
Channels often involve long-term commitments, yet the company wants to keep the channel flexible so that it can adapt to environmental changes
manufacturer-sponsored wholesaler franchise system
Coca-Cola licenses bottlers (wholesalers) in various world markets that buy Coca-Cola syrup concentrate and then bottle and sell the finished product to retailers locally.
intensive distribution, exclusive distribution, and selective distribution.
Companies must also determine the number of channel members to use at each level. Three strategies are available
channel conflict.
Cooperating to achieve overall channel goals sometimes means giving up individual company goals. Although channel members depend on one another, they often act alone in their own short-run best interests. They often disagree on who should do what and for what rewards. Such disagreements over goals, roles, and rewards generate
Promotion.
Developing and spreading persuasive communications about an offer.
conventional distribution channel
Each is a separate business seeking to maximize its own profits, perhaps even at the expense of the system as a whole. No channel member has much control over the other members, and no formal means exists for assigning roles and resolving channel conflict.
channel level.
Each layer of marketing intermediaries that performs some work in bringing the product and its ownership closer to the final buyer is a
Contact.
Finding and engaging customers and prospective buyers.
logistics
First, companies can gain a powerful competitive advantage by using improved logistics to give customers better service or lower prices. Second, improved logistics can yield tremendous cost savings to both a company and its customers. Third, the explosion in product variety has created a need for improved logistics management. Finally, more than almost any other marketing function, logistics affects the environment and a firm's environmental sustainability efforts.
Even established brands may have difficulty gaining and keeping their desired distribution, especially when dealing with powerful resellers.
For example, Amazon.com refuses to sell Google's line of Nest smart home products, its Google Home voice assistant speakers, or its Pixel smartphone, saying that they compete with its own Amazon Echo and other products.
multichannel marketing system
For example, John Deere sells its familiar green-and-yellow lawn and garden tractors, mowers, and outdoor power products to consumers and commercial users through several channels, including John Deere retailers, Lowe's home improvement stores, and online.
administered VMS
For example, P&G and Apple can command unusual cooperation from many resellers regarding displays, shelf space, promotions, and price policies.
direct marketing channel
For example, Pampered Chef, Mary Kay Cosmetics, and Amway sell their products through home and office sales parties and online websites and social media; companies ranging from GEICO insurance to Quicken Loans to Omaha Steaks sell directly to customers via internet, mobile, and telephone channels.
horizontal marketing system
For example, Target partners with non competitor Starbucks to place coffee stands in its stores.
Disintermediation
For example, app-based ride-hailing services Lyft and Uber have recently stormed onto the scene, rapidly disintermediating traditional taxi and car-for-hire services by offering better customer experiences at lower fares We now look at several channel design decisions
corporate VMS
For example, grocery giant Kroger owns and operates 38 food product plants—17 dairies, seven bakery plants, five grocery plants, one deli plant, two frozen dough plants, two beverage plants, two cheese plants, and two meat plants.
intensive distribution
For example, toothpaste, candy, and other similar items are sold in millions of outlets to provide maximum brand exposure and consumer convenience. P&G, Coca-Cola, Kimberly-Clark, and other consumer goods companies distribute their products in this way.
At the other extreme are producers that have to work hard to line up enough qualified intermediaries.
For example, when Timex first tried to sell its inexpensive watches through regular jewelry stores, most jewelry stores refused to carry them.
Producers vary in their ability to attract qualified marketing intermediaries. Some producers have no trouble signing up channel members.
For example, when Toyota first introduced its Lexus line in the United States, it had no trouble attracting new dealers. In fact, it had to turn down many would-be resellers.
intermediaries
From the economic system's point of view, the role of marketing______is to transform the assortments of products made by producers into the assortments wanted by consumers
Information.
Gathering and distributing information about consumers, producers, and other actors and forces in the marketing environment needed for planning and aiding exchange.
Marketing logistics
In short, it involves getting the right product to the right customer in the right place at the right time profitably.
Information. Promotion. Contact.Matching.Negotiation.Physical distribution.Financing.Risk taking.
Members of the marketing channel perform many key functions. Some help to complete transactions:
flows
Moreover, all the institutions in the channel are connected by several types of
selective distribution
Most consumer electronics, furniture, and home appliance brands are distributed in this manner.
vertical marketing system (VMS)
One channel member owns the others, has contracts with them, or wields so much power that they must all cooperate.
vertical marketing systems
One of the biggest channel developments over the years has been the emergence of _______that provide channel leadership.
full-line forcing
Producers of a strong brand sometimes sell it to dealers only if the dealers will take some or all of the rest of its line
Intermediaries
Producers use ______because they create greater efficiency in making goods available to target markets.
supply chain.
Producing a product or service and making it available to buyers requires building relationships not only with customers but also with key suppliers and resellers in the company's
Negotiation.
Reaching an agreement on price and other terms so that ownership or possession can be transferred.
Matching.
Shaping offers to meet the buyer's needs, including activities such as manufacturing, grading, assembling, and packaging.
exclusive territorial agreements
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.
exclusive arrangements
The seller obtains more loyal and dependable outlets, and the dealers obtain a steady source of supply and stronger seller support.
International marketers face many additional complexities in designing their channels.
There are large differences in the numbers and types of intermediaries serving each country market and in the transportation infrastructure serving these intermediaries.
manufacturer-sponsored retailer franchise system, manufacturer-sponsored wholesaler franchise system, service-firm-sponsored retailer franchise system
There are three types of franchises.
intermediaries
Through their contacts, experience, specialization, and scale of operation,______usually offer the firm more than it can achieve on its own
Physical distribution.
Transporting and storing goods.
control issues
Using intermediaries usually means giving them some control over the marketing of the product, and some intermediaries take more control than others.
the number of intermediaries, and the responsibilities of each channel member.
When the company has defined its channel objectives, it should next identify its major channel alternatives in terms of the types of intermediaries,
exclusive distribution.
When the seller allows only certain outlets to carry its products, this strategy is called
exclusive dealing.
When the seller requires that these dealers not handle competitors' products, its strategy is called
disintermediation
a big term with a clear message and important consequences.
economic criteria
a company compares the likely sales, costs, and profitability of different channel alternatives.
marketing channel (or distribution channel)
a set of interdependent organizations that help make a product or service available for use or consumption by the consumer or business user.
intensive distribution
a strategy in which they stock their products in as many outlets as possible.
company's channel objectives
are also influenced by the nature of the company, its products, its marketing intermediaries, its competitors, and the environment.
In making products and services
available to consumers, channel members add value by bridging the major time, place, and possession gaps that separate goods and services from those who use them.
Marketing channel design
calls for analyzing consumer needs, setting channel objectives, identifying major channel alternatives, and evaluating the alternatives.
Marketing channel management
calls for selecting, managing, and motivating individual channel members and evaluating their performance over time.
Vertical conflict
conflict between different levels of the same channel, is even more common.
contractual VMS
consists of independent firms at different levels of production and distribution that join together through contracts to obtain more economies or sales impact than each could achieve alone.
conventional distribution channel
consists of one or more independent producers, wholesalers, and retailers.
vertical marketing system (VMS)
consists of producers, wholesalers, and retailers acting as a unified system
supply chain
consists of upstream and downstream partners
indirect marketing channels
containing one or more intermediaries.
The firm's sales force and communications
decisions depend on how much persuasion, training, motivation, and support its channel partners need.
Pricing
depends on whether the company works with national discount chains, uses high-quality specialty stores, or sells directly to consumers online.
service-firm-sponsored retailer franchise system
for example, Jimmy Johns and its more than 2,600 franchisee-operated restaurants in the United States.
business has been franchised
from motels and fast-food restaurants to dental centers and dating services, from wedding consultants and handyman services to funeral homes, fitness centers, moving services, and hair salons.
direct marketing channel
has no intermediary levels—the company sells directly to consumers.
conventional distribution channels
have lacked such leadership and power, often resulting in damaging conflict and poor performance.
exclusive distribution
in which the producer gives only a limited number of dealers the exclusive right to distribute its products in their territories.
horizontal marketing system
in which two or more companies at one level join together to follow a new marketing opportunity.
value-added resellers
independent distributors and dealers that develop computer systems and applications tailored to the special needs of small and medium-sized business customers.
The number of intermediary levels
indicates the length of a channel.
corporate VMS
integrates successive stages of production and distribution under single ownership.
Marketing logistics—also called physical distribution
involves planning, implementing, and controlling the physical flow of goods, services, and related information from points of origin to points of consumption to meet customer requirements at a profit.
value delivery network
is made up of the company, suppliers, distributors, and, ultimately, customers who "partner" with each other to improve the performance of the entire system.
franchise organization
is the most common type of contractual relationship.
Upstream from the company
is the set of firms that supply the raw materials, components, parts, information, finances, and expertise needed to create a product or service.
logistics manager's task
is to coordinate the activities of suppliers, purchasing agents, marketers, channel members, and customers.
administered VMS
leadership is assumed not through common ownership or contractual ties but through the size and power of one or a few dominant channel members.
Producers
make narrow assortments of products in large quantities
supply chain management
managing upstream and downstream value-added flows of materials, final goods, and related information among suppliers, the company, resellers, and final consumers,
environmental factors such as economic conditions and legal constraints
may affect channel objectives and design.
inbound logistics
moving products and materials from suppliers to the factory
outbound logistics
moving products from the factory to resellers and ultimately to customers
producer and intermediaries
need to agree on the terms and responsibilities of each channel member They should agree on price policies, conditions of sale, territory rights, and the specific services to be performed by each party.
Horizontal conflict
occurs among firms at the same level of the channel.
multichannel marketing
occurs when a single firm sets up two or more marketing channels to reach one or more customer segments.
Disintermediation
occurs when product or service producers cut out intermediaries and go directly to final buyers or when radically new types of channel intermediaries displace traditional ones.
Distribution channel decisions
often involve long-term commitments to other firms
manufacturer-sponsored retailer franchise system
or example, Ford and its network of independent franchised dealers.
Downstream marketing channel
partners, such as wholesalers and retailers, form a vital link between the firm and its customers.
sense-and-respond
planning starts by identifying the needs of target customers, to which the company responds by organizing a chain of resources and activities with the goal of creating customer value.
reverse logistics
reusing, recycling, refurbishing, or disposing of broken, unwanted, or excess products returned by consumers or resellers
channel alternative
should be evaluated against economic, control, and adaptability criteria.
downstream
side of the supply chain—the marketing channels (or distribution channels) that look toward the customer.
customer-centered logistics
starts with the marketplace and works backward to the factory or even to sources of supply.
selective distribution
the use of more than one but fewer than all of the intermediaries who are willing to carry a company's products.
partner relationship management
to forge long-term partnerships with channel members. This creates a value delivery system that meets the needs of both the company and its marketing partners.
customer relationship management (CRM) software systems
to help manage relationships with important customers
PRM and supply chain management (SCM) software
to help recruit, train, organize, manage, motivate, and evaluate relationships with channel partners.
consumers
want broad assortments of products in small quantities.
distribution channels through contracts
with franchisees, independent dealers, or large retailers, they cannot readily replace these channels with company-owned stores or internet sites if the conditions change.
complex sales force structure
Salespeople can be specialized by customer and territory; product and territory; product and customer; or territory, product, and customer.
For the channel as a whole to perform well
each channel member's role must be specified, and channel conflict must be managed.
territorial sales force structure
each salesperson is assigned to an exclusive geographic area and sells the company's full line of products or services to all customers in that territory.
Independent off-price retailers
either are independently owned and run or are divisions of larger retail corporations
Warehouse clubs
(also known as wholesale clubs or membership warehouses), such as Costco, Sam's Club, and BJ's, operate in huge, warehouse-like facilities and offer few frills
discount store
(for example, Target, Kohl's, or Walmart) sells standard merchandise at lower prices by accepting lower margins and selling higher volume.
the company website
A firm that uses direct marketing would sell its products through _____.
the communication effects and the sales and profit effects.
Advertisers should regularly evaluate two types of advertising results:
DECIDING ON MEDIA TIMING.
An advertiser must also decide how to schedule the advertising over time. Suppose sales of a product peak in December and drop in March (for winter outdoor gear, for instance). The firm can vary its advertising to follow the seasonal pattern, oppose the seasonal pattern, or be the same all year.
Advertising
Any paid form of nonpersonal presentation and promotion of ideas, goods, or services by an identified sponsor. includes broadcast, print, online, mobile, outdoor, and other forms.
team selling
As products become more complex and as customers grow larger and more demanding, a single salesperson simply can't handle all of a large customer's need
content marketing managers
As such, they create, inspire, and share brand messages and conversations with and among customers across a fluid mix of paid, owned, earned, and shared communication channels.
off-price retailers
As the major discount stores traded up, a new wave of __________ moved in to fill the ultralow-price, high-volume gap
Risk taking.
Assuming the risks of carrying out the channel work.
salesperson
At one extreme, a salesperson might be largely an order taker, such as the department store salesperson standing behind the counter. At the other extreme are order getters, whose positions demand creative selling, social selling, and relationship building for products and services ranging from appliances, industrial equipment, and airplanes to insurance and IT services.
preapproach
Before calling on a prospect, the salesperson should learn as much as possible about the organization (what it needs, who is involved in the buying) and its buyers (their characteristics and buying styles).
beacon technology
Bluetooth connections that greet and engage customers via their smartphones as they shop around in stores.
Public affairs
Building and maintaining national or local community relationships.
Lobbying
Building and maintaining relationships with legislators and government officials to influence legislation and regulation.
Public relations (PR)
Building good relations with the company's various publics by obtaining favorable publicity, building up a good corporate image, and handling or heading off unfavorable rumors, stories, and events. includes press releases, sponsorships, events, and webpages.
direct and digital marketing
Catalogs, online and social media, and mobile marketing are some of the specific promotional tools used in _____.
Direct and digital marketing
Engaging directly with carefully targeted individual consumers and customer communities to both obtain an immediate response and build lasting customer relationships. includes direct mail, email, catalogs, online and social media, mobile marketing, and more.
Independent off-price retailers
Examples include store retailers such as TJ Maxx, Marshalls, and HomeGoods, all owned by TJX Companies, and online sellers such as Overstock.com.
wholesalers.
Firms engaged primarily in wholesaling activities are called
Advertising appeals
First, they should be meaningful, pointing out benefits that make the product more desirable or interesting to consumers. Second, appeals must be believable. Consumers must believe that the product or service will deliver the promised benefits. Appeals should also be distinctive They should tell how the product is better than competing brands.
push strategy
For example, John Deere does very little promoting of its lawn mowers, garden tractors, and other residential consumer products to final consumers. Instead, John Deere's sales force works with Lowe's, Home Depot, independent dealers, and other channel members, who in turn push John Deere products to final consumers.
Tone
For example, P&G always uses a positive tone: Its ads say something very positive about its products. Other advertisers now use edgy humor to break through the commercial clutter. Doritos and Burger King commercials are famous for this.
pull strategy
For example, P&G promotes its Tide laundry products directly to consumers using TV and print ads, web and social media brand sites, and other channels.
augmented (AR) and virtual reality (VR) to enhance the shopping experience.
For example, customers at North Face's Manhattan store can don virtual-reality headsets that transport them to remote hiking, climbing, or even base-jumping locations where they can experience gutsy jumps off a 420-foot cliff, all while using North Face gear.
shared projects.
For example, many large retailers conduct joint in-store programs with suppliers. Home Depot allows key suppliers to use its stores as a testing ground for new merchandising programs.
memorable and attention-getting words
For example, rather than just saying that its prescription sunglass lenses protect your eyes and look good at the same time, a LensCrafters ad announces, "Sunblock Never Looked So Good."
experiential retailing.
For example, up-scale home furnishings retailer Restoration Hardware has unleashed a new generation of furniture galleries in Chicago, Atlanta, Denver, Tampa, and Hollywood that are part store, part interior design studio, part restaurant, and part home
product assortment, services mix, and store atmosphere.
Retailers must decide on three major product variables:
the affordable method, the percentage-of-sales method, the competitive-parity method, and the objective-and-task method.
Here, we look at four common methods used to set the total budget for advertising
format elements
In a print or display ad, the illustration is the first thing the reader notices—it must be strong enough to draw attention. Next, the headline must effectively entice the right people to read the copy. Finally, the copy—the main block of text in the ad—must be simple but strong and convincing
a push strategy
In which of the following does a producer direct marketing activities (primary personal selling and trade promotion) toward channel members?
Investor relations.
Maintaining relationships with shareholders and others in the financial community
just-in-time logistics systems.
Many companies have greatly reduced their inventories and related costs through ______. With such systems, producers and retailers carry only small inventories of parts or merchandise, often enough for only a few days of operations.
vendor-managed inventory (VMI) systems or continuous inventory replenishment systems
Many large retailers—such as Walmart and Home Depot—work closely with major suppliers such as P&G or Moen to set up
push promotion or pull promotion.
Marketers can choose from two basic promotion mix strategies
advertising, personal selling, sales promotion, public relations, and direct and social media marketing—to reach consumers.
Retailers use various combinations of the five promotion tools
involves the entire supply chain management
Marketing logistics addresses not only outbounds logistics but also inbound logistics and reverse logistics, which means it_______.
setting advertising objectives, setting the advertising budget, developing advertising strategy (message decisions and media decisions), and evaluating advertising effectiveness.
Marketing management must make four important decisions when developing an advertising program
direct
Mary kay cosmetics and amway sell their products through home and office sales parties, online websites, and social media. Both companies use a ____ channel to distribute their offerings
Business promotions
are used to generate business leads, stimulate purchases, reward customers, and motivate salespeople.
potentially high cost savings and improved customer satisfaction
One of the primary advantages of marketing logistics is _____.
Personal selling
Personal customer interactions by the firm's sales force to engage customers, make sales, and build customer relationships. includes sales presentations, trade shows, and incentive programs.
public relations
Press releases, sponsorships, events, and web pages are promotional tools used in ______.
create greater efficiently in making goods available to target markets
Producers use marketing intermediaries because they_____
category killers
Recent years have also seen the rapid growth of superstores that are actually giant specialty stores(for example, Best Buy, Home Depot, Petco, and Bed Bath & Beyond).
Sales promotion
Short-term incentives to encourage the purchase or sale of a product or service.includes discounts, coupons, displays, demonstrations, and events.
Selling and promoting Buying and assortment building Bulk breaking Warehousing Transportation financing Risk bearing Market information Management services and advice
Simply put, wholesalers add value by performing one or more of the following channel functions:
cross-functional, cross-company teams.
Smart companies coordinate their logistics strategies and forge strong partnerships with suppliers and customers to improve customer service and reduce channel costs. Many companies have created
CONSUMER-GENERATED CONTENT
Taking advantage of today's digital and social media technologies, many companies are now tapping consumers for marketing content, message ideas, or even actual ads and videos
the general message that will be communicated to consumers.
The first step in creating effective advertising content is to plan a message strategy
Advertising Sales promotion Personal selling Public relations (PR) Direct and digital marketing
The five major promotion tools are defined as follows
deliver clear, consistent, and compelling messages about the organization and its brands
The goal of integrated marketing communications is to ______.
warehousing, inventory management, transportation, and logistics information management
The goal of logistics is to provide a targeted level of service at the least or lowest possible cost. To achieve this goal, which of the following are logistical functional areas
warehousing, inventory management, transportation, and logistics information management.
The major logistics functions are
(1) determining reach, frequency, impact, and engagement; (2) choosing among major media types; (3) selecting specific media vehicles; and (4) choosing media timing.
The major steps in advertising media selection are
embedding brands as props within other programming.
The most common form of brand integration is product placements
push strategy
The producer directs its marketing activities (primarily personal selling and trade promotion) toward channel members to induce them to carry the product and promote it to final consumers.
independents, factory outlets, and warehouse clubs.
The three main types of off-price retailers are
Corporate chains
Their size allows them to buy in large quantities at lower prices and gain promotional economies. They can hire specialists to deal with areas such as pricing, promotion, merchandising, inventory control, and sales forecasting.
wholesalers
They can choose a target group by size of customer (for example, large retailers only), type of customer (convenience stores only), the need for service (customers who need credit), or other factors.
affordable method
They set the promotion budget at the level they think the company can afford.
objective-and-task method
This budgeting method entails (1) defining specific promotion objectives, (2) determining the tasks needed to achieve these objectives, and (3) estimating the costs of performing these tasks.
integrated logistics management.
This concept recognizes that providing better customer service and trimming distribution costs require teamwork, both inside the company and among all the marketing channel organizations.
advertainment or brand integrations
This merging of advertising and entertainment takes one of two forms:
retail convergence
This merging of consumers, products, prices, and retailers is called
including the amount of service they offer, the breadth and depth of their product lines, the relative prices they charge, and how they are organized.
Thus, to meet the needs of customers who work across multiple channels as they shop, traditional store retailers are rapidly integrating digital, online, and mobile shopping into their operations. They can be classified in terms of several characteristics
a fixed amount, a variable amount, expenses, and fringe benefits.
To attract good salespeople, a company must have an appealing compensation plan
"Madison & Vine.
To break through the clutter, many marketers are now a merging of advertising and entertainment, a practice dubbed
self-service, limited service, and full service.
To meet these varying service needs, retailers may offer one of three service levels:
DETERMINING REACH, FREQUENCY, IMPACT, AND ENGAGEMENT.
To select media, the advertiser must determine the reach and frequency needed to achieve the advertising objectives.
creating advertising messages and selecting advertising media
What are the two major elements in developing advertising strategy?
reminder
Which advertising is best suited to maintaining customer relationships and for mature products?
integrated supply chain management
Which of the following recognizes that improves logistics mandates teamwork across the company and the entire supply chain?
outsourcing logistics functions
Which of the following represents a new trend in logistics to save costs, increase efficiencies, and gain faster and more effective access to global markets?
the lines between advertising and public relations are becoming more blurred
Which of the following statements about public relations is correct?
personal selling
Which of the following uses promotional tools such as presentations, trade shows, and incentive programs to engage customers, make sales, and build customer relationships?
Risk bearing
Wholesalers absorb risk by taking title and bearing the cost of theft, damage, spoilage, and obsolescence.
Transportation
Wholesalers can provide quicker delivery to buyers because they are closer to buyers than are producers.
Buying and assortment building
Wholesalers can select items and build assortments needed by their customers, thereby saving much work.
merchant wholesalers, brokers and agents, and manufacturers' and retailers' branches and offices
Wholesalers fall into three major groups
financing
Wholesalers finance their customers by giving credit, and they finance their suppliers by ordering early and paying bills on time.
Market information
Wholesalers give information to suppliers and customers about competitors, new products, and price developments.
Warehousing
Wholesalers hold inventories, thereby reducing the inventory costs and risks of suppliers and customers.
Management services and advice
Wholesalers often help retailers train their salesclerks, improve store layouts and displays, and set up accounting and inventory control systems.
Bulk breaking
Wholesalers save their customers money by buying in carload lots and breaking bulk (breaking large lots into small quantities).
Selling and promoting
Wholesalers' sales forces help manufacturers reach many small customers at a low cost. The wholesaler has more contacts and is often more trusted by the buyer than the distant manufacturer.
Development
Working with donors or members of nonprofit organizations to gain financial or volunteer support.
customer (or market) sales force structure
a company organizes its sales force along customer or industry lines.
retailer cooperative
a group of independent retailers that bands together to set up a jointly owned, central wholesale operation and conduct joint merchandising and promotion efforts.
voluntary chain
a wholesaler-sponsored group of independent retailers that engages in group buying and common merchandising.
Railroads
account for 10 percent of the total tons shipped. They are one of the most cost-effective modes for shipping large amounts of bulk products—coal, sand, minerals, and farm and forest products—over long distances.
native advertising (also called sponsored content
advertising or other brand-produced online content that appears to be "native to" the web or social media site in which it is placed
Advertising specialties
also called promotional products, are useful articles imprinted with an advertiser's name, logo, or message that are given as gifts to consumers.
Coupons
are certificates that save buyers money when they purchase specified products.
distribution centers
are designed to move goods rather than just store them.
Premiums
are goods offered either free or at low cost as an incentive to buy a product, ranging from toys included with kids' products to phone cards and DVDs.
Power centers
are huge unenclosed shopping centers consisting of a long strip of retail stores, including large, freestanding anchors such as Walmart, Home Depot, Costco, Best Buy, Michaels, PetSmart, and Office Depot.
Rebates (or cash refunds)
are like coupons except that the price reduction occurs after the purchase rather than at the retail outlet.
Superstores
are much larger than regular supermarkets and offer a large assortment of routinely purchased food products, nonfood items, and services.
Samples
are offers of a trial amount of a product.
Convenience stores
are small stores that carry a limited line of high-turnover convenience goods.
lifestyle centers
are smaller, open-air malls with upscale stores, convenient locations, and nonretail activities, such as a playground, skating rink, hotel, dining establishments, and a movie theater complex.
Merchant wholesalers
are the largest single group of wholesalers, accounting for roughly 50 percent of all wholesaling.include two broad types: full-service wholesalers and limited-service wholesalers.
Supermarkets
are the most frequently visited type of retail store.Walmart, Costco, and Dollar General
Corporate chains
are two or more outlets that are commonly owned and controlled.
sales force management
as analyzing, planning, implementing, and controlling sales force activities.It includes designing sales force strategy and structure as well as recruiting, selecting, training, compensating, supervising, and evaluating the firm's salespeople
broker
brings buyers and sellers together and assists in negotiation
retailers
businesses whose sales come primarily from retailing.
sweepstakes
calls for consumers to submit their names for a drawing.
services mix
can also help set one retailer apart from another For example, some retailers invite customers to ask questions or consult service representatives in person or via phone or tablet.
Trade promotions
can persuade resellers to carry a brand, give it shelf space, promote it in advertising, and push it to consumers.
choice of transportation
carriers affects the pricing of products, delivery performance, and the condition of goods when they arrive—all of which will affect customer satisfaction.
internet
carries digital products from producer to customer via satellite, cable, phone wire, or wireless signal.
department stores
carry a wide variety of product lines.
specialty stores
carry narrow product lines with deep assortments within those lines.
multimodal transportation
combining two or more modes of transportation.Piggyback describes the use of rail and trucks; fishyback, water and trucks; trainship, water and rail; and airtruck, air and trucks.
Business-to-consumer
companies usually pull more, putting more of their funds into advertising, followed by sales promotion, personal selling, and then public relations.
inside salespeople
conduct business from their offices via phone, online and social media interactions, or visits from buyers
a pull strategy
direct its marketing activities (primary advertising, consumer promotion, and direct and digital media) toward final consumers to induce them to buy the product
public relations
consists of activities designed to engage and build good relations with the company's various publics.Press relations or press agency. Creating and placing newsworthy information in the news media to attract attention to a person, product, or service. Product and brand publicity. Publicizing specific products and brands.
Sales promotion
consists of short-term incentives to encourage the purchase or sales of a product or service.
promotion mix—also called its marketing communications mix
consists of the specific blend of advertising, public relations, personal selling, sales promotion, and direct and digital marketing tools that the company uses to engage consumers, persuasively communicate customer value, and build customer relationships.
Advertising strategy
consists of two major elements: creating advertising messages and selecting advertising media.
community shopping center
contains between 15 and 50 retail stores
omni-channel retailing
creating a seamless cross-channel buying experience that integrates in-store, online, and mobile shopping.
value selling
demonstrating and delivering superior customer value and capturing a return on that value that is fair for both the customer and the company.
corporate chains, voluntary chains, retailer cooperatives, and franchise organizations.
describes four major types of retail organizations
Organizational climate
describes the feeling that salespeople have about their opportunities, value, and rewards for a good performance.
supply chain management
entails managing upstream and downstream value-added flows of materials, final goods, and related information among suppliers, the company, resellers, and final consumers
Slice of life Lifestyle Fantasy. Mood or image Musical Personality symbol Technical expertise Scientific evidence Testimonial evidence or endorsement.
execution styles, such as the following:
truck, rail, water, pipeline, and air along with an alternative mode for digital products—the internet.
five main transportation modes
shopper marketing
focusing the entire marketing process—from product and brand development to logistics, promotion, and merchandising—toward turning shoppers into buyers as they move along toward the point of sale.
Franchising
has been prominent in fast-food restaurants, motels, health and fitness centers, auto sales and service dealerships, and real estate agencies.
Trucks
have increased their share of transportation steadily and now account for 64 percent of total tons transported in the United States.
MESSAGE EXECUTION.
he advertiser now must turn the big idea into an actual ad execution that will capture the target market's attention and interest.
pull strategy
he producer directs its marketing activities (primarily advertising, consumer promotion, and direct and digital media) toward final consumers to induce them to buy the product.
prospecting
identifying qualified potential customers
persuasive advertising has become comparative advertising (or attack advertising
in which a company directly or indirectly compares its brand with one or more other brands.
product sales force structure
in which the sales force specializes along product lines.
Consumer promotions
include a wide range of tools—from samples, coupons, refunds, premiums, and point-of-purchase displays to contests, sweepstakes, and event sponsorships.
Point-of-purchase (POP) promotions
include displays and demonstrations that take place at the point of sale. Manufacturers have therefore respon
Service retailers
include hotels and motels, banks, airlines, restaurants, colleges, hospitals, movie theaters, tennis clubs, bowling alleys, repair services, hair salons, and dry cleaners.
Wholesaling
includes all the activities involved in selling goods and services to those buying them for resale or business use
Retailing
includes all the activities involved in selling products or services directly to final consumers for their personal, nonbusiness use.
Brand integrations (or branded entertainment
involve making the brand an inseparable part of some other form of entertainment or content.
push strategy
involves "pushing" the product through marketing channels to final consumers.
sales contest
is a contest for salespeople or dealers to motivate them to increase their sales performance over a given period.
shopping center
is a group of retail businesses built on a site that is planned, developed, owned, and managed as a unit.
Frequency
is a measure of how many times the average person in the target market is exposed to a message.
Reach
is a measure of the percentage of people in the target market who are exposed to an ad campaign during a given period of time.
advertising objective
is a specific communication task to be accomplished with a specific target audience during a specific period of time.can be classified by their primary purpose—to inform, persuade, or remind
store's atmosphere
is another important element in the reseller's product arsenal. Retailers want to create a unique store experience, one that suits the target market and moves customers to buy.
Direct marketing
is immediate and personalized: Messages can be prepared quickly—even in real time—and tailored to appeal to individual consumers or brand groups.
Reminder advertising
is important for mature products; it helps to maintain customer relationships and keep consumers thinking about the product.
Personal selling
is one of the oldest professions in the world.It involves interpersonal interactions and engagement between salespeople and individual customers—whether face-to-face, by phone, via email or social media, through video or online conferences, or by other means.
franchise
is that franchise systems are normally based on some unique product or service; a method of doing business; or the trade name, goodwill, or patent that the franchisor has developed.
Analyzing consumer needs
is the first step in marketing channel design
advertainment
is to make ads and brand content themselves so entertaining or so useful that people want to watch them.
Informative advertising
is used heavily when introducing a new product category.
differentiate
itself by offering merchandise that no other competitor carries, such as store brands or national brands on which it holds exclusive rights.
Factory outlets
manufacturer-owned and operated stores by firms such as J.Crew, Gap, Levi Strauss, and others—sometimes group together in factory outlet malls and value-retail centers.
creative concept
may emerge as a visualization, a phrase, or a combination of the two.
selecting specific media vehicles
media planners must balance media costs against several media effectiveness factors
Media planners
must also consider the costs of producing ads for different media. Whereas newspaper ads may cost very little to produce, flashy television ads can be very costly. Many online and social media ads cost little to produce, but costs can climb when producing made-for-the-web video and ad series.
wholesalers
must decide on product and service assortments, prices, promotion, and place.
Measuring the communication effects
of an ad or ad campaign tells whether the ads and media are communicating the ad message well.
media impact—the qualitative value
of message exposure through a given medium
Price packs (also called cents-off deals)
offer consumers savings off the regular price of a product.
The advertiser must next develop a compelling creative concept
or big idea—that will bring the message strategy to life in a distinctive and memorable way.
Standardization
produces many benefits—lower advertising costs, greater global advertising coordination, and a more consistent worldwide image
Agents
represent buyers or sellers on a more permanent basis
follow-up
s necessary if the salesperson wants to ensure customer satisfaction and repeat business.
prospecting and qualifying, preapproach, approach, presentation and demonstration, handling objections, closing, and follow-up.
selling process consists of seven steps
Self-service retailers
serve customers who are willing to perform their own locate-compare-select process to save time or money.(such as supermarkets) and nationally branded, fast-moving shopping goods (such as Target or Kohl's)'
percentage-of-sales method
setting their promotion budget at a certain percentage of current or forecasted sales.
competitive-parity method
setting their promotion budgets to match competitors' outlays.
The goal of marketing logistics
should be to provide a targeted level of customer service at the least cost.
product assortment
should differentiate it while matching target shoppers' expectations.
sales quotas
standards stating the amount they should sell and how sales should be divided among the company's products.
Storage warehouses
store goods for moderate to long periods.
third-party logistics (3PL) providers
such as Ryder, Penske Logistics, BAX Global, DHL Logistics, FedEx Logistics, and UPS Business Solutions.
Limited-service retailers
such as Sears or JCPenney, provide more sales assistance because they carry more shopping goods about which customers need information
Full-service retailers
such as high-end specialty stores (for example, Tiffany or Williams-Sonoma) and first-class department stores (such as Nordstrom or Neiman Marcus), assist customers in every phase of the shopping process.
Message strategy statements
tend to be plain, straightforward outlines of benefits and positioning points that the advertiser wants to stress.
business-to-business marketers
tend to push more, putting more of their funds into personal selling, followed by sales promotion, advertising, and public relations.
neighborhood shopping centers or strip malls
that generally contain between 5 and 15 stores
integrated marketing communications (IMC)
the company carefully integrates its many communication channels to deliver a clear, consistent, and compelling message about the organization and its brands.
VMI
the customer shares real-time data on sales and current inventory levels with the supplier. The supplier then takes full responsibility for managing inventories and deliveries. Some retailers even go so far as to shift inventory and delivery costs to the supplier
electronic data interchange (EDI)
the digital exchange of data between organizations, which primarily is transmitted via the internet.
regional shopping center, or regional shopping mall
the largest and most dramatic shopping center, has from 50 to more than 100 stores, including two or more full-line department stores.
digital, mobile, and social media; newspapers; direct mail; magazines; radio; and outdoor.
the major media types are television
approach step
the salesperson should know how to meet and greet the buyer and get the relationship off to a good start
handling objections
the salesperson should use a positive approach, seek out hidden objections, ask the buyer to clarify any objections, take objections as opportunities to provide more information, and turn the objections into reasons for buying
presentation step of the selling process
the salesperson tells the "value story" to the buyer, showing how the company's offer solves the customer's problems
social selling
the use of online, mobile, and social media to engage customers, build stronger customer relationships, and augment sales performance.
transaction oriented
their aim is to help salespeople close a specific sale with a customer.
retailers
their marketing decisions include choices of segmentation and targeting, differentiation and positioning, and the marketing mix—product and service assortments, price, promotion, and distribution
event marketing (or event sponsorships
they can create their own brand-marketing events or serve as sole or participating sponsors of events created by others.
-direct and digital marketing
tools that engage directly with carefully targeted individuals consumers and customer communities to both obtain an immediate response and build lasting customer relationships
air carriers
transport less than 1 percent of the of the nation's goods, they are an important transportation mode. Airfreight rates are much higher than rail or truck rates, but airfreight is ideal when speed is needed or distant markets have to be reached. Among the most frequently airfreighted products are perishables (such as fresh fish, cut flowers) and high-value, low-bulk items (technical instruments, jewelry
Outside salespeople
travel to call on customers in the field
fixed amount
usually a salary, gives the salesperson some stable income.
objective-and-task method
whereby the company sets its promotion budget based on what it wants to accomplish with promotion
Pipelines
which account for 18 percent of the tonnage transported, are a specialized means of shipping petroleum, natural gas, and chemicals from sources to markets. Most pipelines are used by their owners to ship their own products.
Water carriers
which account for 4 percent of goods transported, transport large amounts of goods by ships and barges on U.S. coastal and inland waterways. Although the cost of water transportation is very low for shipping bulky, low-value, nonperishable products such as sand, coal, grain, oil, and metallic ores, water transportation is the slowest mode and may be affected by the weather.
variable amount
which might be commissions or bonuses based on sales performance, rewards the salesperson for greater effort and success.
agencies employ specialists
who can often perform advertising and brand content tasks better than the company's own staff can.
omni-channel buyers
who make little distinction between in-store and online shopping, and for whom the path to a retail purchase runs across multiple channels.
