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International Marketing Channels

8. International Marketing Channels. 8.01 International Channel Design. Winning Strategies - read. Open All Night Everywhere. 7-Eleven stores are open 24 hours a day. 7-Eleven stores have improved their efficiency through the use of technology.

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International Marketing Channels

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  1. 8 International Marketing Channels 8.01 International Channel Design

  2. Winning Strategies - read Open All Night Everywhere • 7-Eleven stores are open 24 hours a day. • 7-Eleven stores have improved their efficiency through the use of technology. • There are almost 28,000 7-Elevens around the world. Chapter 8

  3. Warm-up video • http://www.youtube.com/watch?v=Tb8bF2hCyLw • A quick overview of channel management Chapter 8

  4. MARKETING CHANNELS • channel of distribution • the path used to move products from their source to the customer • logistics • activities that create an orderly and timely acquisition and transportation of products through the channel of distribution Chapter 8

  5. Channel Length • marketing intermediary • an independent business that assists the flow of goods and services from producer to customers Chapter 8

  6. Types of marketing intermediaries • Agent/broker • Place buyers and sellers together • Facilitate transactions • Do not take ownership of product • Wholesaler • Re-distributes to retailers • Take ownership of products • Retailer • Redistributes to consumers • Take ownership of products Chapter 8

  7. Channel Length (continued) Chapter 8

  8. Channel Length(continued) • short channel of distribution • Few intermediaries • direct channel • From producer directly to consumer • long channel of distribution • Many intermediaries • indirect channel of distribution • Used primarily for consumer goods Chapter 8

  9. Role of Intermediaries • Breaking bulk shipment into smaller quantities • Provide information to other channel members • Storage of products • Transportation of products • Provide financing • Promote products Chapter 8

  10. Channel Length(continued) • Channels of distribution have become a key to international competitiveness because they can: • facilitate just-in-time (JIT) inventory • lower costs • speed up distribution • support expansion into new markets Chapter 8

  11. Just-in-time inventory • Products arrive just as they are needed • Utilize computerized inventory and point-of-sale systems to monitor inventory levels and place orders • http://www.youtube.com/watch?v=AqK8VcLOxH8 • http://www.youtube.com/watch?v=AAcX0SRjOCw • Two videos on just in time Chapter 8

  12. International Channel Design • When entering new markets, international marketers can either: • establish a new channel of distribution • High risk strategy • Need to develop new relationships with suppliers • work within an existing channel of distribution Chapter 8

  13. Total Cost Concept • total cost concept • all costs must be taken into consideration when designing a channel of distribution • Added shipping costs • Transportation time must also be considered Chapter 8

  14. IBH – 8.01 Activity • Students pair with someone other than their IBP partner • Research an automobile manufacturer who has opened up a manufacturing plant in a foreign country in order to lower total cost of distribution to that country • http://www.kia.com/#/about/ • http://corporate.honda.com/america/facilities.aspx • https://www.bmwusfactory.com/ • http://corporate.ford.com/our-company/operations-worldwide • http://media.gm.com/autoshows/Chevrolet_Centennial/2010/public/intl/en/chevrolet/news.detail.html/content/Pages/news/intl/en/2011/centennial/03_01_the_first_100_years.html Chapter 8

  15. >> C H E C K P O I N T Name four ways distribution channels aid in developing competitive advantages. Chapter 8

  16. CHANNEL RELATIONSHIPS • All distribution systems seek to achieve the lowest cost possible. • Can result indisintermediation • the removal of channel members to save costs • http://www.youtube.com/watch?v=LACYuGoP4IE • Examples of results due to disintermediation Chapter 8

  17. Channel Power • Some channel members have more power than others • channel captain – example UD • takes the leadership role in organizing a distribution system • gains power through their ability to reward or punish channel members and through their knowledge of their product-market Chapter 8

  18. Finding International Partners • There are a number of ways for international marketers to find partners. • government sources from commerce departments • trade show contacts • Internet Chapter 8

  19. Finding International Partners (continued) • export management companies (EMCs) • specialize in helping businesses distribute products • agent • brings together buyers and sellers, but does not take ownership of product • http://www.youtube.com/watch?v=qDbnx6nLrQo Chapter 8

  20. >> C H E C K P O I N T Name four ways that businesses can find international partners. Chapter 8

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