Channel level final
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The document discusses different levels in marketing distribution channels. A channel level refers to a layer of marketing intermediaries that brings a product to the final buyer. Common channel levels include zero-level (direct from manufacturer to consumer), one-level (manufacturer to retailer to consumer), two-level (manufacturer to wholesaler to retailer to consumer), and three-level (manufacturer to wholesaler to jobber to retailer to consumer). Longer channels with more intermediaries are more common when retail markets are fragmented with many small retailers.
Channel level final
- 2. Numbers of Distribution Channel Levels Each layer of marketing intermediaries that performs some work in bringing the product to its final buyer is a "channel level". The figure shows some examples of channel levels for consumer marketing channels:
- 4. WholesalerWholesaler JobberJobber RetailerRetailer ConsumerConsumer→ → → → ConsumerConsumer RetailerRetailer ConsumerConsumer→ ManufacturerManufacturer 0-level channel WholesalerWholesaler RetailerRetailer ConsumerConsumer→ →MfgMfg 2-level channel MfgMfg 3-level channel 1-level channel ManufacturerManufacturer Consumer Marketing Channels - Length
- 5. Zero level It has no intermediary levels. In this case the manufacturer sells directly to customers. An example of a direct marketing channel would be a factory outlet store. Many holiday companies also market direct to consumers, bypassing a traditional retail intermediary - the travel agent.
- 6. 1 level channel contains one intermediary. In consumer markets, this is typically a retailer. The consumer electrical goods market is typical of this arrangement whereby producers such as Sony, Panasonic, Canon etc. sell their goods directly to large retailers such as Next, Das and Memorex which then sell the goods to the final consumers.
- 7. 2 level channel contains two intermediary levels - a wholesaler and a retailer. A wholesaler typically buys and stores large quantities of several producers goods and then breaks into the bulk deliveries to supply retailers with smaller quantities. For small retailers with limited order quantities, the use of wholesalers makes economic sense.
- 8. 2 level channel This arrangement tends to work best where the retail channel is fragmented - i.e. not dominated by a small number of large, powerful retailers who have an incentive to cut out the wholesaler.
- 9. Channel Levels Zero level: Direct Marketing M-C. Also called Direct Marketing Channel. Eureka Forbes, Tupperware, Asian Sky shop, Indiatimes.com 1 level channel: M-Retailer-C 2 level channel: M-Wsaler-Retailer-C 3 level channel: M-Wsaler-Jobber-Rtler-C
- 10. Channel Levels Zero level: Direct Marketing M-C. Also called Direct Marketing Channel. Eureka Forbes, Tupperware, Asian Sky shop, Indiatimes.com 1 level channel: M-Retailer-C 2 level channel: M-Wsaler-Retailer-C 3 level channel: M-Wsaler-Jobber-Rtler-C