Summary these are among the types of help a firm can get by utilizing a channel’s partner. They are an important part of an organization as they act as the extension of the company and specialize in promoting the product. Some of the ways they add value to the pr
The direct channel applies typically in businesses like 1. Small Local Shops and 2. Custom-made high-value products (e.g., machinery) or services for industrial markets or producer-to-government buyers (Lamb, Hair, & McDaniel, 2013). The indirect channel does not apply to companies mass-producing high-volume standardized items (e.g., consumer goods) of moderate or low value, they rather rely on intermediaries (Lamb, Hair, & McDaniel, 2013). The method to go direct or indirect channel depends on what product or service the business is selling and how much is it willing to invest in distribution, for instance, small businesses may not have the capital to pursue indirect channel so they go for the direct channel while the business grows, on the other hand, big businesses may pursue multiple distribution channels to explore a wider market or even foreign markets (Direct vs. indirect distribution channels, n.d.) In this competitive time, if the demand of customers is not satisfied appropriately, the company will at a competitive disadvantage, and competitors will get the advantage. So, to avoid that, companies chose the best marketing channel, and channel partners to actively promote and sell their products. Not all the products can be sold as direct selling, some need to have intermediaries who act as Middleman. For Example, the possibility is buying online from some third party unless buying directly from the company website. But some people are comfortable buying things through third parties for assurance. For example, buying cars from the dealership, buying houses from a realtor, and reaching a lawyer for legal advice. To maximize customer satisfaction, it is crucial to understand the product's target markets and design a channel that works for those markets. B) Explain the value middlemen can add to product sales and marketing success. Many products and services pass through multiple organizations before they get to a customer. These organizations are called intermediaries or middlemen/ resellers (Principles of marketing, n.d.). Middlemen specialize in performing activities that are directly involved in the purchase and sale of goods in the process of their flow from producers to the ultimate buyers. Their position is between the producers and ultimate buyers. Examples of middlemen include wholesalers, retailers, agents, and brokers. Wholesalers buy goods in bulk and sell them to the retailers in large quantities. Retailers and brokers acquire the goods from the wholesalers and sell them in small quantities to the consumers. Partnerships between companies and intermediaries are not always in the best interests of the company (ideally, they could sell their products straight to users) but because the intermediaries can help them in selling the products better than they could work alone. In other words, they have some sort of capabilities the producer needs: -
Connected book
Written for
- Institution
- MBA or M.B.A. - Master of Business Administration
- Course
- MBA or M.B.A. - Master of Business Administration
Document information
- Summarized whole book?
- No
- Which chapters are summarized?
- 12-13
- Uploaded on
- April 3, 2022
- Number of pages
- 7
- Written in
- 2022/2023
- Type
- Summary
Subjects
- broker
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a direct marketing channel typically involves a producer and a consumer in contrast
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an indirect channel is a channel that includes one or more intermediaries distributor
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or agent compani
Also available in package deal