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Business Business Market Market
ManagementManagement
33rdrd edition edition
Business Channel Business Channel ManagementManagement
Chapter 7
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-2
Section III: Section III: Creating ValueCreating Value
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-3
Chapter 7: Chapter 7: Business Channel Business Channel
ManagementManagementOverviewOverview
I. Designing Superior Value-Adding Marketing
Channels
II. Creating Value Through Direct Channels
III. Strengthening Reseller Performance
IV. Summary
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-4
OverviewOverview Marketing channels are a source of
competitive differentiation as products and services become commodity-like
Channels augment market offerings by creating a highly valued total customer total customer experience (TCE)experience (TCE) Marketing ChannelMarketing Channel—a set of interdependent
organizations involved in the process of making a product or service available for use or consumption.
(Stern and El-Ansary)
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-5
Business Channel ManagementBusiness Channel Management
The process of designing a set of marketing and distribution arrangements that create superior customer value for targeted market segments and customers, and executing those arrangements directly through supplier firm sales forces and logistics systems or indirectly through resellers and 3rd-party service providers
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-6
Create Value for Targeted Market
Segments &Customer Firms
Create Value for Targeted Market
Segments &Customer Firms
Create Value for Targeted Market
Segments &Customer Firms
Designing SuperiorValue-Adding
Marketing Channels
Hybrid Channel
Arrangements
Construct Channel
Offering(s)
Build Marketplace
Equity
Craft Reseller Value
Proposition(s)
Design Logistics Systems
Create ValueMerchants
DeployValue Merchants
Creating Value Through Direct ChannelsCreating Value Through Direct Channels
Strengthening Reseller PerformanceStrengthening Reseller Performance
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-7
I. Designing Superior I. Designing Superior Value-Adding Marketing Value-Adding Marketing
ChannelsChannels
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-8
Designing Superior Designing Superior Value-Adding Marketing ChannelsValue-Adding Marketing Channels
Total Customer Experience (TCE)Entails all aspect of a customer firm’s Entails all aspect of a customer firm’s
encounter with a supplier firmencounter with a supplier firm
• TCE Goals:
– Positive experience
– Seamless
– Memorable interaction that matches customer firm’s
purchasing requirements and preferences
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-9
Immediacy of fulfillment
Breadth & depth of products & services
Availability of products and services
Timing and reliability of delivery
Installation
Payment terms and conditions
Extent of augmenting value-added services
Pre-sale Point-of-sale Post-sale services or
“for-fee options”
Research indicates Research indicates that firms that focus on “fulfillment”that firms that focus on “fulfillment”
are more profitable. are more profitable. ((GroveGrove))
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-10
Four TCE-Based PositionsFour TCE-Based PositionsEfficient, low-cost
transaction experienceThe high-touch,
consultative experienceInexpensive, convenient, self-service Minimal value-added service
Internet Web sitesInternet Web sitesDirect marketingDirect marketing
Extensive consultation and adviceCustomization of offeringsFrequent face-to-face encountersComplete range of value-added services
The flexible, multi-
access-point experience
The one-stop shopping experience
Customer free to purchase supplier's offerings intact or piecemeal from several integrated or stand-alone channels on a transaction-by- transaction basis
Customer can purchase a wide variety of complementary products and services from a single source
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-11
Designing a Superior Value-Adding Designing a Superior Value-Adding Marketing ChanelMarketing Chanel
1. Specify goals and objectives of the marketing
channel(s)
2. Assess customer value of TCE
3. Envision value proposition for each targeted
market
4. Reformulate the TCE for each targeted market
5. Configure the channel network
6. Finalize marketing and distribution arrangements
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-12
Specify Goals and Objectives of Specify Goals and Objectives of Marketing ChannelsMarketing Channels
Three Predominant GoalsMaximize Market AccessMaximize Market Access
• How business channels enable a supplier to reach, develop, and serve targeted segments and customer firms
Optimize Value-AddedOptimize Value-Added• This entails the augmenting products and services that
channel partners contribute to the supplier firm’s market offering
Minimize Cost-to-ServeMinimize Cost-to-Serve• The total expenditures required
to deliver the intended TCE to
targeted segments and
customers
Caution:Caution: Channel goals often work Channel goals often work at odds with one another.at odds with one another.
Trade-offs & adjustment Trade-offs & adjustment may be needed.may be needed.
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-13
Assess Customer Value of Assess Customer Value of Potential TCE ElementsPotential TCE Elements
Business market managers should focus on value elements that contribute to the total customer experiencetotal customer experience Service Outputs & their Monetary ValueService Outputs & their Monetary Value
• Integrated supply• Local customization• Emergency delivery• Technical support• Product standardization
Assess Customer Preferences for Assess Customer Preferences for • Learning• Shopping• Buying• Getting help
These services These services stronglystrongly suggest the type of suggest the type of
channel network the supplier channel network the supplier should adoptshould adopt
These are These are criticalcritical as they shape the as they shape the ““soft” side of TCEsoft” side of TCE
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-14
Envision a Value Proposition for Envision a Value Proposition for Each Targeted Market SegmentEach Targeted Market Segment
Customer Value PropositionCustomer Value Proposition serves as a
beacon for all the supplier firm’s channel
network design effort
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-15
Reformulate the Intended TCE for Reformulate the Intended TCE for Each Targeted Market SegmentEach Targeted Market Segment
Add, delete, or modify products and valued-
added services as well as fulfillment and
communication processes to more closely meet
the critical TCE requirements and preferences of
the targeted segment
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-16
Configure the Channel NetworkConfigure the Channel Network
Managers simultaneously consult and consider the classic channel strategies related to exposure and coverage, postponement and speculation, and functional acquisition and functional spin-off
Managers meld their strategic preferences into a channel network design that can profitably deliver the intended TCE to targeted segments
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-17
Finalize Marketing and Finalize Marketing and Distribution ArrangementsDistribution Arrangements
To gain market access, channels must provide sufficient exposure and coverageExposure:Exposure: degree targeted customer firms are degree targeted customer firms are
reached and served by the appropriate kind and reached and served by the appropriate kind and number of channelsnumber of channels
• Single-channel strategy• Multiple-channel strategy
Coverage:Coverage: number of resellers or direct sales number of resellers or direct sales persons assigned per geographic trade areapersons assigned per geographic trade area
• Distribution intensity strategy: exclusive, selective, or intensive
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-18
Distribution Intensity StrategiesDistribution Intensity StrategiesExclusive Supplier authorizes one resellerauthorizes one reseller per trade area
Selective Supplier authorizes a limited number of resellersauthorizes a limited number of resellers per trade area
Intensive Supplier authorizes all resellersauthorizes all resellers who want to carry its line
The above three distribution intensity strategies can be differentiated in terms of the supplier’s share of the reseller’s business
1. The reseller sells only the supplier’s offering
2. The reseller sells one of the supplier’s line along with other firm’s lines
3. The reseller sells only one of the supplier’s products and an assortment of other firms’ products
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-19
Channel Exposure & Coverage ModelChannel Exposure & Coverage Modelfor an Electronic Controls Supplier Firmfor an Electronic Controls Supplier Firm
ElectronicComponents
ManufacturersNo Coverage
3 electroniccomponent distributors
Direct Sales20 field sales persons10 service reps
Scientific TestingEquipment
ManufacturersIndirect Sales
8 scientific equipmentdistributors
Process Control Manufacturers
Direct MarketingSupplier Website5 Inside Sales Reps
10 machine tooldistributors
Segment
OfferingOffering
Small Orders of Standard
Items
Medium-SizedOrder of
Specialty Items
Large Orders ofCustomized
Solutions
Source: Adapted from Friedman & Furey 1999
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-20
Optimize Value-Added Through Optimize Value-Added Through Postponement or SpeculationPostponement or Speculation
Strategies hinge on:
Predictability of demandPredictability of demand
Quantity of productionQuantity of production
Inventory held in reserveInventory held in reserve
Required proximity of customization activities Required proximity of customization activities
& inventory to customer location& inventory to customer location
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-21
Postponement vs. SpeculationPostponement vs. SpeculationStrategiesStrategies
Postponement StrategySupplier firm undertakes Supplier firm undertakes product design, customization, product design, customization, and value-added service and value-added service geographically close to geographically close to customer firmcustomer firm
Speculation StrategySuppler firm manufactures standard Suppler firm manufactures standard products in large quantities well in products in large quantities well in advance of demand at a distance advance of demand at a distance from the customerfrom the customer
Direct salesDirect salesDesign-to-order offeringsDesign-to-order offeringsTechnically competent and Technically competent and consultativeconsultative
sales teamsales teamJust-in-time inventoryJust-in-time inventoryHigh level end-to-end customer High level end-to-end customer serviceservice
Indirect salesIndirect salesIntensive distributionIntensive distributionReseller firm stocks inventoriesReseller firm stocks inventoriesTakes ordersTakes ordersMakes deliveriesMakes deliveriesProvides minimum valued-added service Provides minimum valued-added service
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-22
Postponement vs. SpeculationPostponement vs. SpeculationManufacturing & LogisticsManufacturing & Logistics
Manufacturing PostponementManufacturing Postponement ManufacturingManufacturing SpeculationSpeculation Indirect sales Local assembly, fabrication, compounding, or extrusion firms Customize supplier’s production to unique requirement for regional firms
Direct marketing via telephone or Internet Build-to-order Mass customizing products Ships directly to customer via 3rd party logistics
LogisticsLogistics PostponementPostponement LogisticsLogistics SpeculationSpeculation
Indirect sales 24-hour delivery Reserve stock in local warehouse Provide immediate emergency deliveries Leave item on consignment at customer’s plant
Direct sales Reserved for largest, most profitable customers Vendor-managed inventory program Supplier firm takes responsibility for customer inventories Emergency delivery of bottleneck items
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-23
Minimize Cost-to-Serve viaMinimize Cost-to-Serve viaFunctional Acquisition & Functional Spin-OffFunctional Acquisition & Functional Spin-Off
Lean enterprise:Lean enterprise: group of individuals, functions, and legally separate but operationally synchronized companies
To improve business processes:
Allocate functions to the most capable partnerAllocate functions to the most capable partner
Bolster their partners’ ability to perform tasksBolster their partners’ ability to perform tasks
Coordinate and integrate efforts of all firms in lean Coordinate and integrate efforts of all firms in lean
enterpriseenterprise
Eliminate redundancies in effortsEliminate redundancies in efforts
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-24
Lean Enterprise Approach to the Lean Enterprise Approach to the Design of a Firm’sChannel NetworksDesign of a Firm’sChannel Networks Conceptualized channel networks:
Horizontally Within Each Channel Level: Functions or Horizontally Within Each Channel Level: Functions or Tasks Performed by a Specific Channel PartnerTasks Performed by a Specific Channel Partner
• Focus on functions when incremental channel improvement needed
• Functional acquisition & functional spin-off helps to lower system costs
Vertically across All Channel Levels: Business Vertically across All Channel Levels: Business ProcessesProcesses
• Appropriate for radical channel redesign• Eliminate resources & effort redundancies within entire
channel network• Lowers total system costs• Maximizes the total value delivered
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-25
Functions ManufacturerManufacturer’s
Representatives
Electrical
Wholesalers
Manufacturing
Advertising
Lead Generation
Field Sales Calls
Fulfillment
Customer Credit
Repair Work
Functions ManufacturerManufacturer’s
Representatives
Electrical
Wholesalers
Manufacturing
Advertising
Lead Generation
Field Sales Calls
Fulfillment
Customer Credit
Repair Work
Firm Performs Function
Channel Firms Channel Firms
Marketing Channel Prior to Functional Acquisition and Spin-Off
Marketing Channel After to Functional Acquisition and Spin-Off
Functional Allocation Charts for Electrical Products SupplierFunctional Allocation Charts for Electrical Products Supplier
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-26
Firms or
Groups Lead
Generation
Prospect
Qualification
Initial Sales Contact
Negotiation & Close
Order
ProcessingFulfillment
Relationship
Management
After-the-Sale
Customer Support & Service
Resellers
Supplier’s Operational Group
Supplier’s Field Sales Force
Supplier’s Inside
Sales Force
Supplier’s Direct Marketing
Supplier’s Internet Web Site
All Customers Supplier’s Strategic customers
Resellers’ targetedcustomers
Manufacturer’s Process
Distributor’s Process
Integrated Multi-Channel Process ModelIntegrated Multi-Channel Process Model
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-27
Channel Network ModelChannel Network Model Maps out the business processes and functions
required to provide the reformulated TCE to targeted customer firms
Model specifies who will complete the required processes and functionsSupplier firmSupplier firmResellersResellersThird-party service providersThird-party service providersCustomer firmsCustomer firms
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-28
General Network ModelsGeneral Network ModelsConventional Modular
Products and services flow from supplier firm resellers market segment or customer firmsChannel captain: a dominant firm emerges
Manages and coordinates distributionManages and coordinates distribution Invests in and cultivates brand or Invests in and cultivates brand or reseller equityreseller equity
Emerging information and logistics technologies Complex networks of relationships among firmsDirect or indirect channelsManager from one firm is system integrator
Envision channel networkEnvision channel networkSelect participating firmsSelect participating firmsManage ongoing relationshipsManage ongoing relationships
Hybrid Integrated Multi-ChannelCombination of conventional and modularAdaptive channels: special hybrid
Suppliers, resellers, 3Suppliers, resellers, 3rdrd-party service -party service providers and customer firms agree to providers and customer firms agree to share complementary capabilitiesshare complementary capabilities
Internet customers
Empower customers to select from different resellers or channels formats
Rather than compete for customer loyalty, suppliers and reseller work together to serve mutual customer
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-29
Finalize Marketing & DistributionFinalize Marketing & Distribution
1. Devise feasible profit model Cost-to-Serve (CTS) modelCost-to-Serve (CTS) model
Payments cover the actual wholesaler’s cost plus a Payments cover the actual wholesaler’s cost plus a
prespecified profitprespecified profit2. Carefully select channel partners
Market research survey to assess customer Market research survey to assess customer preferences for and satisfaction with reseller firmspreferences for and satisfaction with reseller firms
Validate research with on-site visitsValidate research with on-site visits
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-30
Finalize Marketing & DistributionFinalize Marketing & Distribution
3. Consider e-business and wireless technology Infomediary:Infomediary: broker that finds, retrieves, sorts, processes & broker that finds, retrieves, sorts, processes &
analyzes information from the web (comparison agent)analyzes information from the web (comparison agent) Metamediaries:Metamediaries: Web sites that furnish multivendor, Web sites that furnish multivendor,
multiproduce, multi-service market placemultiproduce, multi-service market place Electronic transaction formatsElectronic transaction formats
• Communities
• Catalogs
• Electronic auctions
• B2B exchange
Wireless technologies: Wireless technologies: • Remote, 24X7 order tracking, payment, and delivery
• Contact Management
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-31
Finalize Marketing & DistributionFinalize Marketing & Distribution4. Build International Marketing Channels
Requires longer business processes and additional functions Requires longer business processes and additional functions in marketing channelin marketing channel
Division of functions among channel members varyDivision of functions among channel members vary• From region to region
• From country to country
5. Formalized Partnership Agreements Handshake agreementsHandshake agreements Written contractWritten contract Licensing agreementLicensing agreement Franchise agreementFranchise agreement
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-32
II. Creating Value Through II. Creating Value Through Direct ChannelsDirect Channels
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-33
Creating a Sales Force of Value Creating a Sales Force of Value MerchantsMerchants
Value merchant: Recognizes supplier’s own cost Recognizes supplier’s own cost
Recognizes the value to the customer in each Recognizes the value to the customer in each
marketmarket
Works to obtain fair return for both supplier Works to obtain fair return for both supplier
firm and customer firmfirm and customer firm
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-34
Creating a Creating a SaleSale Force of Value Force of Value MerchantsMerchants
Internally promote a value-based marketing
philosophy & culture
Train value merchants
Compensate value merchants based on
profitability of accounts
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-35
Deploying Values MerchantsDeploying Values Merchants
Establish necessary sales units
Determine number of merchants needed
Designate areas of responsibility
Assign value merchants to areas of
responsibility
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-36
Designing a Logistics System that Designing a Logistics System that Creates ValueCreates Value
Segment the market into logistically distinct Segment the market into logistically distinct businessesbusinessesA set of customers with unique physical distribution A set of customers with unique physical distribution
requirementsrequirementsEstablish differential service standards for each Establish differential service standards for each
market segmentmarket segmentTailor unique logistics systems to deliver differential Tailor unique logistics systems to deliver differential
servicesservicesExploit economies of scale among the different Exploit economies of scale among the different
logistics systemslogistics systems
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-37
III. Strengthening III. Strengthening Reseller PerformanceReseller Performance
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-38
Strengthening Reseller Strengthening Reseller PerformancePerformance
The best way to ensure resellers deliver superior value to customers is for the supplier to create superior value for
resellers.
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-39
Channel PositioningChannel Positioning
Channel Positioning:Channel Positioning: the process of establishing and sustaining the supplier’s reputation among targeted resellers for providing superior value
Suppliers need to recognize resellers as Suppliers need to recognize resellers as partnerspartners
Supplier and reseller must build a working Supplier and reseller must build a working relationship founded on mutual self-respectrelationship founded on mutual self-respect
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-40
Channel PositioningChannel Positioning
Step 1 Determine reseller performance expectations
Step 2 Assess the reseller value of channel offering elements
Step 3 Craft a reseller value proposition and channel offering
Step 4Communicate the reseller value proposition
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-41
Decomposing Marketplace EquityDecomposing Marketplace Equity
Marketplace Equity
Supplier
Reseller
Targeted CustomerSegment
ChannelEquity
ResellerEquity
BrandEquity
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-42
Cultivate Brand and Cultivate Brand and Reseller EquityReseller Equity
Supplier FirmsDevelop and sustain strong brand equity Develop and sustain strong brand equity
among targeted customersamong targeted customersAvoid the “final customer” syndrome where Avoid the “final customer” syndrome where
the supplier treats the reseller as the final the supplier treats the reseller as the final customer customer
Reseller FirmsStrive to keep their equity strong Strive to keep their equity strong
• Customize market offerings• Continuous improvements in customer services
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-43
Channel CoreChannel CoreElementsElements
Financial ReturnsQuality Products
Competitive PricesReliable Delivery
Brand Equity
Technical AssistanceMarket ResearchCompany Policies
Promotional SupportResponsiveness Systems Training
ManufacturerSales Force Incentives
DistributorFirm Incentives
DistributorSales ForceIncentives
Capability-BuildingCapability-BuildingProgramProgram
IncentiveIncentiveProgramsPrograms
The Channel OfferingThe Channel Offering
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-44
Reseller Value Proposition and Reseller Value Proposition and Channel OfferingChannel Offering
BundleA collection of loosely connected products and services that a supplier firm consolidates in a transaction for a discounted price
Solution A deliberately engineered and integrated group of products and services that the supplier firm markets for a premium price
Reseller-Offering Platform
A product or service upon which the bundle or solution is assembled (tends to be a high-turnover, lower-margin item)
Reseller-Offering
Peripheral
A component, subassembly, or complementary item that functions in conjunction with the platform
Reseller-Offering Accessory
An extra, noncritical item that is often added onto a transaction without forethought. May or may not be complementary to the platform
(tends to have slower turnover but high margins).
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-45
Channel Positioning Matrix (CPM)Channel Positioning Matrix (CPM)(Figure 7.10)(Figure 7.10)
CPM:CPM: a detailed comparative analysis of what a supplier: provides to its resellerprovides to its resellerwhat its competitors providewhat its competitors providewhat are its resellers’ requirementwhat are its resellers’ requirement
Results of CPM:Results of CPM: Changes for suppliers to pursue that will Changes for suppliers to pursue that will
contribute most to a reseller value propositioncontribute most to a reseller value proposition
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-46
IV. SummaryIV. Summary
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-47
SummarySummary Business market channels augment customer value of
supplier’s offering and create a competitive advantage through the delivery of TCE.
A TCE entails all aspects of a customers firm’s encounter with a supplier. It should be positive, seamless and a memorable interactions that matches the customer firm’s purchasing requirements and preferences.
Business channel management is the process of designing a set of marketing and distribution arrangements that create superior customer value via tailored TCE for targeted segments and customers and executing those arrangements.
Suppliers turn to channel positioning to ensure that resellers will enthusiastically market their products and services as well as deliver the intended TCE.
Copyright © 2009 Pearson Education Publishing as Prentice Hall
Business Market Management, 3rd edition Chapter 7-48
All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any
means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the
United States of America.
Copyright © 2009 Pearson Education, Inc. Copyright © 2009 Pearson Education, Inc. Publishing as Prentice HallPublishing as Prentice Hall
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