Marketing channels are sets of interdependent organizations involved in the process of making a product or service available for use or consumption.
A simple example of a television company – Television companies such as LG, Samsung sells its products to a distributor. A distributor in turn sells it to dealers. A dealer sells it retailers and a retailer near your house sells the television to you.
Thus the marketing channel is
Company > Distributor > Dealer > Retailer > Customer.
Marketing channel decisions are one of the most critical decisions by management. The marketing channel decisions affect all marketing decisions such as pricing, advertising and promotions, placement and positioning. Also these marketing channel decisions are very long term decisions. Replacing channel representatives is a major ordeal. Thus marketing channels need some core decisions to be made.
Marketers therefore choose to go for a value network in case of marketing channel decisions.
Read Value networks in marketing channels
Get Daily Marketing Updates in your Inbox
About Hitesh Bhasin
