managing channel relationships

• channel conflict: the actions of one channel members is precieved as reducing the ability of another to achieve goals 
• mannaged using channel design contracts 
• channel power: when one channel member has influence over the behavior of othe channel members
• channel conflict: occurs when channel members have inconsistent goals 
• vertical conflict: disagreement among channel members that buy and sell to one another 
• exclusivity 
• territial enchroachment 
• example: samsung wants best buy to exclusively carry all it's t.v's but not those of competition brands 
• horizontal conflict : discord among members at the same level 
• price war among retailers of the same product 
• example best buy and sears engage in price war for samsung tv's 
• power: when one channel member has influence over the behavior of other channel members 
• managing channel power; contracts provide a legitamate means of managing power in channel relationships 
• 
  

• the impacts of climate change,water scarcity and availability of raw materials and oil is affecting the production and affordability of food 
• ways of marketing channels add value 
• reduce number of transactions 
• increase value for consumers 
• more efficient and effective operations 
• without marketing channel, consumers would be forced to 
• find raw materials,
• manufacture products
• direct vs indirect strategies 
• direct marketing channel - no intermedierise i,e, GAP 
• inderect channel - has intermediariees 
• one intermediaries - car dealerships 
• two intermediaries - beer companies wholesale, retail, consumer 
• design marketing channels : retailers, role of distrubution centers versus direct store delivery 
• benefits of distrubution centers 
• store merchandise until the next link in the chain is ready for it 
• prepare floor-ready merchandise 
• adds to overall efficiency - distribution centers use sophisticated routing and scheduling systems 
• logistics: movement of products through channels 
• concerns for: timeliness, consistency, quality, efficiency, sustainability 
• vendor-managed inventory: transaction data sent directly to manufacturer: order for new merchandise; vendor- managed negotiation 
• just in time inventory systems: coordinate deliveries between distrubution center: corporate-managed negotiations 
• inventory managment strategies: pull vs push marketing 
• push: producer centric
• maxamize production ( high inventory) 
• products with stable demand 
• pull 
• customer centric 
• resellers order from manufacturer based on consumer demand 
• products with uncertain demand 
• manufacturer focus: influence consumer demand 
• 
  

• everyday low price - emphasizes the continuity of retail prices lower than what the competition may offer 
• high/low pricing - relies on sales promotion, during which prices are temporarily reduced to boost sales 
• market penetration pricing - low initial price in order to attract a large number of buyers and win a larger market share 
• regular price later 
• price skimming 
• high initial price in order to appeal to customers willing to pay higher prices to obtain a new product or service 
• lower price when sales slows 
• consumer behavior and pricing: lessons from behavioral economics 
• people tend to behave irrationally in a predictable fashion 
• consumer behavior and pricing: anchoring 
• consumers are comparative thinking to make decisions 
• consumers are distracted by options 
• decoy pricing strategy
• consumers are distracted by options 
• people tend to have a change in preference between two options when presented with a third person option 
• strategic rccomendations 
• offer 3 options 
• include the one you want people to buy in the middle 
• charm prices have an end on the 9 
• sale price markers with the old price mentioned were more powerful
• dishes with a number-only prices are percieved to be less expensive 
• deceptive price advertising - luring customers into the store with deceptive pricing information
• predatory pricing - occurs when a firms set prices low with the intent to drive its competition out of business 
•  price fixing - occurs when firms collude to control prices 
•