Marketing Channels
To reach a target market, the marketer uses three kinds of marketing channels. Communication channels deliver and receive messages from target buyers and include newspapers,magazines,radio, television, mail, telephone, billboards, posters, fliers, CD s, audiotapes, and the Internet. Beyond these, firms communicate through the look of their retail stores and Web sites and other media. Marketers are increasingly adding dialogue channels such as e-mail,blogs,and toll-free numbers to familiar monologue channels such as ads.
The marketer uses distribution channels to display, sell, or deliver the physical product or service(s) to the buyer or user.These channels may be direct via the Internet,mail,or mobile phone or telephone, or indirect with distributors, wholesalers, retailers, and agents as intermediaries. To carry out transactions with potential buyers, the marketer also uses service channels that in- clude warehouses, transportation companies, banks, and insurance companies. Marketers clearly face a design challenge in choosing the best mix of communication,distribution,and service channels for their offerings.
Supply Chain
The supply chain is a longer channel stretching from raw materials to components to finished products carried to final buyers.The supply chain for coffee may start with Ethiopian farmers who plant, tend, and pick the coffee beans, selling their harvest to wholesalers or perhaps a Fair Trade cooperative.If sold through the cooperative,the coffee is washed,dried,and packaged for shipment by an Alternative Trading Organization (ATO) that pays a minimum of $1.26 a pound. The ATO transports the coffee to the developing world where it can sell it directly or via retail channels.Eachcompany captures only a certain percentage of the total value generated by the supply chain’s value delivery system. When a company acquires competitors or expands upstream or downstream, its aim is to capture a higher percentage of supply chain value.
Competition
Competition includes all the actual and potential rival offerings and substitutes a buyer might consider.An automobile manufacturer can buy steel from U.S.Steel in the United States,from a foreign firm in Japan or Korea,or from a minimill such as Nucor at a cost savings,or it can buy aluminum for certain parts from Alcoa to reduce the car’s weight, or engineered plastics from Saudi Basic Industries Corporation (SABIC) instead of steel.Clearly,U.S.Steel would be thinking too narrowly about its competition if it thought only of other integrated steel companies. In the long run, U.S. Steel is more likely to be hurt by substitute products than by other steel companies.
Marketing Environment
The marketing environment consists of the task environment and the broad environment.The task environment includes the actors engaged in producing, distributing, and promoting the offering. These are the company,suppliers,distributors,dealers,and target customers.In the supplier group are material suppliers and service suppliers, such as marketing research agencies, advertising agencies, banking and insurance companies, transportation companies, and telecommunications companies. Distributors and dealers include agents, brokers, manufacturer representatives, and others who facilitate finding and selling to customers.
The broad environment consists of six components: demographic environment,economic environment, social-cultural environment, natural environment, technological environment, and political-legal environment. Marketers must pay close attention to the trends and developments in these and adjust their marketing strategies as needed. New opportunities are constantly emerging that await the right marketing savvy and ingenuity. Here are two good examples.