MARKETING CHANNEL CONCEPT - 6
INTRODUCTION:
JULIA : Maraming salamat, Ms. Mangampo.
Sa unang balita, ayon sa career development.com
ang marketing channels ay isang tools na
ginagamit ng mga marketers to build a connection
between a manufacturer or company sa group of
potential customers na kung saan na makakatulong
ito upang mamanage ng maayos ang kanilang
sales and pagdevelop ng epektibong marketing
strategy for their business. (NEXT SLIDE PLEASE)
JULIA: Para sa karagdagan, marketing
channel is also described as the set of people,
organizations, and activities that work together to
transfer goods (products and services) from the
point of origin to the point of consumption. Ang
primary purpose ng marketing channel is to create
a connection between the organization that creates
a product or service and prospective customers
who may want to purchase it. (NEXT SLIDE
PLEASE)
JULIA: But from a marketing manager's
perspective, the marketing channel daw is “the
external contractual organization that
management operates to achieve its
distribution objectives”.  with a transaction or a series of transactions
External: Marketing channel exists outside
of the firm.  Firms must use inter-
organizational management rather than
intra-organizational management.
According to Williamson 1075 ang
Interorganizational management is mainly
out of the business, while the
intraorganizational management is mainly
inside the business. Diba sabi nga in
external marketing channels exists outside
the firm so ang mas applicable na dapat
gamitin ng firms ay inter-organization
management
Contractual Organization: Refers to those
firms or parties who are involved in the
negotiatory functions. Negotiator functions
include: buying, selling, or transferring title
from one firm to another.
Operates: Involvement by management in
the affairs of the channel
Distribution objectives: Management has
certain distribution goals in mind such as
distribution to particular retail stores of key
products at or near key times. (NEXT
SLIDE PLEASE)
INTRODUCTION:
JULIA: Para sa sunod na balita growing importance
of marketing channels, ating alamin. (NEXT SLIDE
PLEASE)
JULIA: A. Explosion of Information Technology
and E-Commerce
The explosion of information
technology and E-commerce in recent years
has focused attention to “channel” as a
means for sustainable competitive
advantage.  Marketing channel strategy and
management must now deal with E-
commerce technology as an integral part of
marketing channels and distribution
systems. 
Technology is the backbone of e-
commerce. Hindi lamang pag-tulong sa
pag-connect sa sellers and customer on
mobile and web platforms, but also enables
the effective management of customer
orders, deliveries, returns and payments of
purchased goods. (NEXT SLIDE PLEASE)
According to Chaffey (2009)
Disintermediation –   ito ang pag-alis ng
intermediaries from a supply chain, or
"cutting out the middlemen" in connection
such as distributors or brokers that formerly
linked a company to its customers while
Reintermediation it is “The creation of new
intermediaries between customers and
suppliers providing services.” Yung
infomediaries ito yung katulad ng eBay,
Shopee, Lazada, Yahoo ganyan it emerged
to connect producers to consumers.
JULIA: B. Difficulty in Gaining Sustainable
Competitive Advantage
Companies struggle to find a sustainable
competitive advantage that cannot be easily
or quickly copied by competitors.  In recent
years, the finding such an advantage is far
more difficult using pricing, product, or
promotion strategies.  Marketing channel
strategy does offer greater potential for
competitive advantage because it is more
difficult for competitors to copy.  
Sustainable competitive advantage: A
competitive edge that cannot be quickly or easily
copied by competitors.
  Product strategy: Whereby a company
creates or modifies a product offering for new or
current markets through the use of product
innovation, augmentation, or line extensions. 
Rapid technology transfer and global competition
have made Parity in product designs, features, and
quality easier for competitors to copy thus reducing
a firm’s competitive advantage through the
product. 
Pricing Strategy: Gaining a competitive
advantage through pricing strategies is even less
feasible than through product development.  Pricing
strategy is defined as using price as an element in
the marketing strategy to gain or hold market share.
Promotion: The integration of personal
selling, advertising, public relations, price
discounts, and trade allowances designed to entice
the consumer to purchase.  The sheer amount of
advertising messages to which consumers are
exposed to on a daily basis dramatically reduces
the time limit promotion provides a firm a
competitive advantage.  Marketing Channel is already given and
 
Place: The where and how the product or
service is delivered to the consumer, the fourth
element in the marketing mix, does offer greater
potential for a sustainable competitive advantage.   strategy.
JULIA: C. Growing Power Of Distributors
Economic power ay lumipat mula sa  mix such as (product, price, promotion, and
producers of goods to the distributors of
goods or tinatawag na retailers for
example.  Ang mga distributor na ito ngayon
ay  bumubuo at gumaganap bilang
“gatekeepers”  for the consumers acting as
buying agents and selecting what products
the consumer “sees” or "nakikita" ng
mamimili. So yung gatekeepers it is a
person who controls access to something
JULIA: D. Need to Reduce Distribution Costs
Distribution costs for many manufacturing
firms often meet or exceed the costs of
manufacturing or raw materials.  Maraming
kumpanya ay lumalampas sa mga gastos
sa pagmamanufacture at para sa raw
materials. In order to reduce these costs,
ang manufacturers daw must begin the
process of focusing attention on marketing
channel structure, dapat mas mag focus sila
sa marketing channel structure in order to
reduce distribution costs. Halimbawa na dito
ay,  they can use technological Innovations,
like new and more automatic materials
handling equipment or trucks suitable for
both over the road and local delivery
service, so with that it can improve the
efficiency of distribution and reduce
distribution costs.
OUTRODUCTION: 
JULIA: Julia Allysa Cano, nakatutok 24 hours
MARKETING MANAGEMENT STRATEGY
INTRODUCTION: 
CLAIRE: Ngayon na alam na natin ang
marketing channel concept dumako naman
tayo sa marketing management srategy. (NEXT
SLIDE PLEASE)
Ayon sa Airfocus, Marketing management
strategy is implementing your business mission
through specific and strategic processes in
order to maximize your current marketing plan.
available to use but not all of them strategize
how to use it efficiently. Kaya minsan nasstock
na lang ang isang business to where it is kasi
hindi swak o hindi ginagamitan ng marketing
Which consist of internal and external
elements. Internal controllable are marketing
place).  External uncontrollable elements
include the economy, technology, government,
sociocultural patterns of buyer behavior and
competition. (NEXT SLIDE PLEASE)
CLAIRE: Ang mga marketing channel ay mas
nagiging epektibo kung gagamitan ito ng
marketing management strategy. A channel
without strategize signal is worthless. Sa
pagbabago ng panahon iba ibang marketing
strategy din ang ginagamit ng isang negosyo.
Maraming paraan ang ginagamit sa pagbuo ng
marketing management strategy. Halimbawa
nito ang  (NEXT SLIDE PLEASE)
CLAIRE: Strategy of strategic alliances or
partnership as a source of sustainable
competitive advantage. In other
view,competitors turn into business partners. 
  Long-term viability mapapahaba or
nappreserve ang pagiging successful ng
iyong business because of the two way
benefit it can provide. Win-win situation
  Cannot be copied quickly
  Cannot be duplicated with price 
  Cannot be substituted with a clever idea
or short-term promotional program(s)
  It is a joined force which reduces
competition and consists of out of the
box visions. Where others CAN imitate
but can’t duplicate. (NEXT SLIDE
PLEASE)
CLAIRE: Para sa susunod na balita narito ang
Channel Strategy vs. Logistics Management
(NEXT SLIDE PLEASE)
When we say channel strategy it is a wide concept
or the bigger picture of the whole. This is where you
plan on what strategy to use and how to implement
it. (NEXT SLIDE PLEASE)
Channel strategy must first be established
before logistics management should be
considered.  Logistic management is a
subsidiary of channel management. (NEXT
SLIDE PLEASE)
CLAIRE: Flows in Marketing Channels These
flows, reflect the linkages that tie channel
members and other agencies in order to move
the product from producer to consumer.Ito
yung mga flows na pinagdadaanan para
mapunta ang products sa consumer. (NEXT
SLIDE PLEASE)  Efficiency is on the channels management
1. Product Flow - The flow of product is
tangible, where we can see and touch
how the movement of products from the
producer towards the consumer.
Dumaan ba sya ng agents?
Manufacturer? Or Warehouse? (NEXT
SLIDE PLEASE)
2. Negotiation Flow - transfer of title or rights
of ownership.  Negotiation is a two-way
process involving mutual exchange
between buyer and seller.  Para
mapunta sa buyer ang isang product its
need to go through negotiation flow. For
example minsan kinuha ang pangalan
natin to transfer the ownership to the
consumer. (NEXT SLIDE PLEASE)
3. Ownership Flow -When movements of
products happen the title of products ay
nababago. For example, from the
manufacturer the products are
transferred in the logistics towards the
warehouse. It means the value or
welfare of the product is in the logistics
and warehousing. If something
happened on it it can be identified upon
which stage it happened. (NEXT SLIDE
PLEASE)
4. Information Flow -   The business will
provide information para malaman ng
mga consumer yung product and
services that they provide and the
consumer will give feedback of
satisfaction based on their use. (NEXT
SLIDE PLEASE)
5. Promotion Flow -refers to the flow of
persuasive communication of the value
towards the consumer. This are the
other discount they use to pursue
customers (NEXT SLIDE PLEASE)
CLAIRE: Distribution through Intermediaries
Selecting intermediaries is vital for the Distribution.
Therefore it needs consideration in Economics for
the result of appearance in marketing channels. Na
mayroong dalawang konsepto. Una ng konsepto ay
ang Specialization and Division of Labor we use
intermediaries to break down complex tasks into
smaller and allocate them. While Contractual
viewpoint where the seller and buyer negotiate and
make an agreement effort. (NEXT SLIDE PLEASE)
We also have key terms Channel Structure and
Ancillary Structure. Kung saan ang Channel
Structure ay group of channel members to which a
set of distribution tasks has been allocated. It
means these are the people who belong to the
channel na gumagawa ng certain activities in the
firm.  (NEXT SLIDE PLEASE)
On the other hand, ancillary structures are groups
of institutions (facilitating agents) that assist
channel members in performing distribution
tasks.  
OUTRODUCTION:
JULIA: Para sa susunod na balita narito si Denise
Delen para ibalita kung ano naman ang marketing
channel participants. Ms. Denise?
MARKETING CHANNEL PARTICIPANTS
INTRODUCTION:
DENISE:  Salamat Julia. Ayon nga, ano, pag-
uusapan naman natin ngayon yung Marketing
Channel Participants. Sinu-sino nga ba sila and
what do they do? Aalamin natin yan.
(next)
First off, meron tayong producers and
manufacturers. Involved sila sa: extracting,
growing, or sa paggawa ng panibagong
product.
Sa producers, they are someone who combine
labor and capital in order to produce an output.
For example yung mga magsasaka. Labor =
magtatanim, pag cultivate ng land, pag aararo.
Capital = nagagastos sa pataba, tools na
necessary sa pagtatanim.
Finished goods naman ito naman yung sa
manufacturers kasi what they do is that they
make use of those raw materials para
makagawa ng panibagong product na ibebenta
nila sa market.
(next)
Ayan to further illustrate, they make use of raw
materials, assemblies, and/or sub assemblies.
Sub assemblies are combined para makabuo
ng components na need i-assemble, which are
called assemblies.
When we say assemblies, they are individual na
components na icocombine together para
makabuo ng isang panibagong product or end
product.
For example yung mga electrical or
merchanical components, Machine parts
ganon.
That is why,
(next)
The goods or products that can be produced
are raw materials - wood, metals, milk, wool,
minerals, rocks, fruits, vegetables. They are
extracted directly from natural resources or
objects.
Then, finished goods, ito yung sa mga
manufacturers wherein ginagamit yung raw
materials. Like yung wood, maaaring gawin
chairs, tables, furniture, papers. Then with
metals naman, yung machine parts, electrical
components, tools such as hammers, and
other similar things na ginagamit din natin.
Lastly, yung services from service providers
naman yan. they can be an individual, a
company, or an organization na nag ooffer or
nagpoprovide ng services nila. For example, an
accountant, a doctor, a lawyer, a teacher, u get
the gist naman. So yung mismong product nila
- skills, knowledge, and expertise.
(next)
Moving on sa isa pang marketing channel
participant – is yung intermediaries naman.
They are independent businesses or individuals
that assist producers and manufacturers in
negotiations and other distribution tasks.
Maraming producers and manufacturers kasi
do not sell their products or services directly to
their consumers and they instead use
intermediaries para makarating yung product
sa final user or end user. And these
intermediaries include:
(next)
Ayan, middlemen such as wholesalers,
distributors, brokers, agents, retailers, and
facilitating agencies. Iisa-isahin natin yan.
(next)
First off, meron tayong wholesalers. Ano ba
munang ginagawa ng wholesalers? So when
you are involved in wholesaling, you are selling
goods or services to other firms, and usually in
bulk siya and lower than retail prices. (_____)
Wholesalers, meron silang tatlong
classification which is merchant wholesalers,
brokers and agents, and manufacturers and
retailers branches and offices.
Una, yung merchant wholesalers. Tinatawag
din silang distributors, or supply houses, and
independently owned and as a result,
independently operated din. What they do is
that they acquire title ownership nung goods
na hinahandle nila. And merong 2 types itong
merchant wholesalers. Ito yung full-service and
limited-service. Yung full service, naghahandle
sila ng larger sales volume and they may also
perform a broader range of services for their
customers such as stocking inventories,
operating warehouses, supplying credit,
employing salespeople to assist customers,
and delivering goods to customers. Limited
service wholesalers naman, mas onti yung
services to their customers and suppliers.
(They might handle a limited line of fast-
moving merchandise, carry a limited line of
semi-perishable goods gaya ng milk, bread,
snacks, and other similar products.)
Then Brokers and agents will be tackled later
on so dun muna tayo sa Manufacturers’ and
retailers’ branches and offices. So dito, yung
wholesaling ay cinoconduct nung mismong
manufacturers, sila yung nag ooperate. Iba siya
sa manufacturing plant ha? Ito ay sales
branches and offices na dinidistribute yung
products mismo nung manufacturers rather
than by independent na wholesalers. So ito,
this allows manufacturers na iimprove yung
inventory control nila, yung selling, pati yung
promotion.
(next)
Then anu-ano nga ba yung tasks na ginagawa
ng isang merchant wholesaler for their
manufacturers or producers.
Market coverage and sales contact – through
the merchant wholesalers, ineenable nila yung
manufacturers or producers na magkaroon ng
market coverage kasi through them, mas
malawak yung maaaring ma-reach nung
products na audience or consumers
Inventory holding – merchant wholesalers tend
to take title dun sa products ng manufacturers
may ownership and magsstock din sila nang
sarili nila which in turn will reduce yung risk
nung manufacturer kasi mababawasan yung
large inventory. Then of course, less din yung
financial burden so makakabuti yun for their
production process or operations.
Order processing – many customers purchase
in small quantities.  The wholesaler can “break
down” a large order of product into much
smaller and more manageable pieces which
would otherwise become a hassle for
manufacturers.
Market information – wholesalers di ba they
are the ones that are in contact or interacting
with the customers so meron silang knowledge
or information about them which can be
communicated to the manufacturers kasi
maaaring maging useful yon to them lalo na
kung feedback kasi malalaman nila kung ano
yung kailangan pang iimprove dun sa product,
kung ano yung kulang, and other helpful
information.
Customer support – wholesalers can provide
services to the customers on behalf of the
manufacturers like adjustments sa product, or
repairs, ganon, assistance.
(next)
Ayan. Kung merong tasks na ginagawa yung
wholesalers for their manufacturers or
producers, meron din syempre for the
customers.
Unang una is yung Product availability – So
tayo as customers, through the merchant
wholesalers, yung products mas nagiging
accessible for us. Kumbaga mas within reach
siya. Hindi mo na kailangang pumunta sa
ganitong specific na location nung
manufacturer na more often than not e malayo
sayo para lang mabili mo yung ganitong
product from them, di ba. So through
wholesalers, napapadali yung pag acquire ng
goods.
Then Customer service – ayon nga, merchant
wholesalers can tend to our questions, needs
about dun sa product since out of reach satin
madalas yung manufacturers or producers
themselves.
Credit and financial assistance – wholesalers
may allow credit to customers on the products.
Pagpapautang, ganon. Babayaran na lang sa
ganitong date, babayaran sa ganitong
circumstance.
Assortment convenience – wholesalers, they
tend to acquire products from different
manufacturers or producers so as a result
super varied yung mga binebenta nila. So
maraming maaaring pagpilian na products
yung customers. Very accessible na kumpara
sa kung bibili sila from different manufacturers,
di ba? So hassle siya.
Then Breaking bulk – ito yung sa kanina
wherein yung wholesalers, they break down
yung large orders ng products for the
customers kasi di ba tayo meron tayong
tendency to buy yung tingi-tingi, di ba? Kasi ita-
try muna, ganyan, or titikman muna, bago mag
commit fully dun sa products by purchasing
yung isang malaking pack, ganon. So
wholesalers do that for us.
Lastly, we have advanced and technical
support – included dun yung pag aassemble or
pag seset up which needs technical
assistance. So the wholesalers can help us
customers with such concerns regarding the
products that we purchased.
(next)
Ok so now we have the brokers and the agents.
Their main purpose is to ease the buying and
selling through negotiations. But ang
difference nito kasi sa wholesalers, brokers
and agents don’t take title or possession of the
products na ibebenta nila. So they are actual
representatives of the manufacturers or
producers. They are hired for that purpose.
So for the brokers, they are usually or
commonly found in food, real estate, and
insurance industries. So they may represent
either the buyer or the seller depending on who
hired them. So they can represent several
manufacturers of noncompeting products.
Hindi sila nag aassume ng risk and wala silang
inventory.
Then yung agents naman, they also do not take
legal ownership of the products that they sell
and wala ring inventory. But there are three
types of agents which are manufacturers’
agents, selling agents, and purchasing agents.
Manufacturers agents represent two or more
manufacturers’ complementary lines on a
continuous basis, are usually compensated by
commission. They are most commonly found
in the furniture, electric, and apparel industries.
Selling or sales agents naman are given
contractual authority to sell all of a
manufacturer’s output and generally have
considerable autonomy to set prices, terms,
and conditions of sale. And then they work on a
commission basis. Sales agents also provide
market feedback and product information to
the manufacturers kaya they play an important
role in product development. They are found in
areas or industries with products such as
chemicals, metals, and industrial machinery
and equipment.
Lastly, yung Purchasing agents, they are with
the buyers naman. They purchase on behalf of
them, they represent the buyer. So they will
receive the product, inspect it, store it, and then
ship them to their buyers.
(next)
Retailing naman, this is the merchandising
aspect of marketing, includes similar activities
for personal or nonbusiness use.
Retailing can take many forms: goods or
services may be sold in person, by mail,
telephone, television, or the Internet, or even
through vending machines.
So these products can be sold on the street, in
a physical, or online store.
The role of the retailer in the distribution
channel, regardless of his size or type, is to
interpret the demands of his customers and
mag stock ng goods na gusto ng customers,
when they want them, and in the way they want
them! So as retailers dapat talaga merong
tamang assortment ng products para rin
always ready sa customers na gustong bumili.
Maraming variety ng retailers but they can be
classified to three types which is yung store
retailers, non-store retailers, and retail
organizations.
Store retailers meron silang assortment of
goods or products. Furniture stores, florists,
sporting-goods stores, bookstores, Department
stores, supermarkets, convenience stores, and
more.
Nonstore retailers naman do not operate
stores. So ibig sabihin, with nonstore retailing
meron dung direct selling, direct marketing,
and automatic vending. Examples non ay
selling door-to-door or house to house, office-
to-office, or at private-home sales meetings.
Direct marketing naman they have a direct
contact with the buyer or consumer. Kasama
jan yung telemarketing, emails, social media
advertisements na nakikita natin online.
(Sa direct marketing, the seller can measure
response to an offer because of its direct
addressability, maeevaluate yung reactions at
response nung consumer. Yung inquiries or
questions, ganyan.)
Lastly, sa automatic vending machines naman
varied din yung products, like cigarettes,
candies, soft drinks, mga ganon. May mga
nakikita tayong ganyan sa gas stations, sa
malls, sa maraming places and yung consumer
na mismo yung pumipili at nag ooperate nung
machine para makuha yung gusto nilang
product.
Then finally sa retail organizations naman
examples niyo yung corporations like sa food,
shoes, clothing lines. Meron silang chain
stores. They tend to hire more specialized and
experienced personnel na better para sa
promotion nung products.
(next)
Ayan, pano nga ba natin nasabi na the Retailers
have a growing power in marketing channels?
-Kasi yung size ng retail ay patuloy na nag i-
increase, ang daming acquisitions. Marami
kasing retailers ay big businesses! And dahil
dun, lumalaki rin yung capacity nila to influence
the actions of other channel members nung
marketing channel. For example, yung SM di ba
meron silang suppliers. And most of them,
hindi naman kasing bigatin ng SM. And
because of the size and buying power of SM,
as well as other similar retailers na bigatin
such as malls, they are in a position na mag
exert ng influence or mag dictate even sa
manufacturers ng terms ng sale na gusto nila.
So retailers have become much larger and
concentrated dito sa Philippines. Noticeable
naman. And I think, dahil na rin sa
advancement sa technology and sa market na
patuloy na nagggrow. As a result, matatawag
talaga natin silang powerful members ng
marketing channels and they tend to dominate
many of those marketing channels kung saan
sila magpa-participate.
(next)
Here are the tasks performed by retailers.
Similar lang din sa wholesalers. (BASAHIN
PPT)
(next)
Lastly, we have Facilitating agencies. Kasi
marketing functions require significant
expertise, and madalas mas efficient and
effective for an organization to use the
assistance of independent marketing
facilitators.
(These are organizations and consultants na
may primary responsibility or purpose na mag
handle ng ilang marketing functions.)
In many larger companies, all or some of these
functions are performed internally. However,
this is not necessary or justifiable in most
companies, which usually require only part-
time or periodic assistance from these
facilitating agencies kasi:
-cannot afford to support the salaries and
operating expenses para mag hire permanently
ng mga personnel na gagawa ng ganong mga
function
-broader expertise
-objective perspectives
-they are more motivated to perform at high
standards, kasi yung facilitating agencies na to,
meron din yang competition. So if hindi mataas
yung quality nung performance nila, maaaring
hindi sila i-hire.
So here we have several examples of
facilitating agencies para lang may idea kayo.
(BASAHIN PPT)
OUTRODUCTION
DENISE: Sana marami kayong natutunan sa
mga naisiwalat na impormasyon tungkol sa
mga kalahok ng marketing channel. Balik sa
inyo jan sa studio, Claire. ( NEXT SLIDE
PLEASE
INTRODUCTION:
CLAIRE: Ang ulat panahon ng MC News resident
meteorologist Mary Grace ‘Aling MG’ Zoilo para
ibalita ang weather update ngayon.
WEATHER  FORECAST
BEHAVIORAL PROCESSES IN MARKETING
CHANNELS
INTRODUCTION:
ZOILO: Maraming salamat Ms. Mangampo.
ZOILO: magandang gabi mga kanguso, aking iuulat
ang weather update.( NEXT SLIDE PLEASE)
ZOILO: Ngayong gabi ay malalaman natin ang
tungkol sa behavioral processes ng marketing
channel. Ito ay ang conflict, power,role, and
communication process. (NEXT SLIDE PLEASE)
ZOILO: Ang una kong iuulat ay ang marketing
channel as a social system.Ano nga ba ang
marketing channel , it is the people or organization
that makes the products available to the
consumers. ang social system naman is the
process of interaction of the individual and
collectivity. So ang collectivity  is yung firms or
agencies, organization. If there is interaction of the
individual or the collectivity in a marketing channel
there will be an interorganizational social system. 
interorganizational , it involves two or more
organization or individual for example is long term
supplier and customer (NEXT SLIDE PLEASE)
ZOILO: Ang susunod na aking iuulat ay ang conflict
vs competition. Ang conflict ay opponent centered
which mean ay nakfocus sya sa rivalry of
organization while yung competition naman ay
object centered which naka focus sya sa goals or
objectives.(NEXT SLIDE PLEASE)  magkaroon ng interaction between channel
ZOILO: Managing channel conflict. In order to
manage a channel conflict the first thing to do is to
distinguish the possible causes of the channel
conflict. (NEXT SLIDE PLEASE)
ZOILO: narito ang mga categories na maaring
nakaugnay ang mga causes of channel conflict.  conflict na maaaring mag underly sa mga
Role incongruities –  channel members of
marketing channel ay may kanya kanyang
nakaassign na responsibilities so kapag may
member na hindi sinunod yung nakaplan nilang
mga dapat gawin dun na nagkakaroon ng conflict
or effect sa pag reach ng ng goals or objectives.
Resource scarcities – so yung mga channel
members is nagkakaroon ng disagreement regardin
sa allocation ng resources na need sa pag achieve
nila ng goals ng organization. For exam is selection
ng franchise channel.
Perceptual differences – so ang mga channel
members ay maaring magkaroon ng parehong
information pero magkaiba yung pag interpret nila
dto. For example, manufacturing company is
nagprovide ng sale material sa retailer para ilagay
ito ng retailer sa retail counter nya. Sa perception
ng company , makakatulong bilang promotional tool
ng products pero yung perception naman retailer is
useless at sumasakop lamang ito ng mahalagang
espasyo sa retail shelves nya.
Expectational differences- bawat channel
members ay may kanya kanyang prediction s
behavior ng kapwa nila channel members. So
nagkakaroon na ng confict kapag yung mga
expectations nila is hindi nangyari. So gumagawa
kasi ng predictions sa magiging behavior ng other
channel members para maachieve nila yung
objectives. So kapag hindi nagmeet  yung naging
expectations may effect to sa magiging result ng
goals nila.
Decision domain disagreement- so sa marketing
channel ,yung mga member neto ay mayroon own
decision making. So ang mangyayare nyan is
nagkakaroon ng conflict kasi iba iba sila ng gustong
mangyare and makakaaffect ito sa process ng
strategy nila sa pagreach ng goals.
Goal incompatibilities- nangyayare tong goal
incompatibilities- if two or more channel memers is
may sariling goals and objectives na gustong
maachieve. Syempre  magiging magulo if walang
sinusunod na isang objectives o iisang goals ang
mga members ng isang marketing channel. Kapag
kasi fixed yung goal ng isang organization mas
mapagtutuunan ito ng attention.kumbaga they have
a straight plan to follow.
Communication difficulties- communication is
very important. Ito yung nagiging way para
members and also sa kanilang prospects. So
kapag nagkaproblema sa pakikipag communicate
nila sa isat isa mahihirapan sila na maachieve yung
objectives nila kasi maaring magkaroon ng
misunderstanding. (NEXT SLIDE PLEASE)
ZOILO: Ito yung mga possible causes ng channel
categories na nabanggit ko kanina. For example
yung misunderstood communication , it may
underlie in communication difficulties. (NEXT
SLIDE PLEASE)
ZOILO: ano nga ba ang channel conflict at channel
efficiency? ang channel conflict ay kapag ang
channel member ay oposing each other. ang
channel efficiency naman ay Ability ng isang
marketing channel na madistribute yung products
ng walang nasasayang na time effort and also yung
the budget cost. (NEXT SLIDE PLEASE)
ZOILO: ito ng nag nalelead, naggaguide sa
kanyang subordinates upang magampanan nila
ang kanilang mga obligations. (NEXT SLIDE
PLEASE)
ZOILO: narito ang dapat na iapply ng isang channel
manager. una ay ang  detect conflicts, manager
should know how to distinguish a conflict. she or he
can manage to identify it with the help of the
perception of other channel members. maiging
gawin ito in a regular basis upang masolusyunan
agad ang conflict at hindi na ito lumala.
pangalawa ay ang Appraise the possible effects of
conflicts- as a manager kailangan na magkaroon
ng assessment sa effects na dulot ng conflict.
obligation ng manager na suriin kung nagbibigay ng
magandang epekto o hindi magandang epekto ang
isang conflict at at ito ay magseserve as a lesson
sa kanila at magamit ito as a guide in the future.
Pangatlo ay resolving channel
conflict.responsibilities ng isang manager ang
gumawa ng action in every conflict na mararanasan
ng management nila.  (NEXT SLIDE PLEASE)
OUTRODUCTION:
ZOILO: Mary Grace Zoilo, nakatutok 24 hours
POWER OF MARKETING CHANNEL
INTRODUCTION:  
 BERNADETH:Para sa sunod na balita, Ano nga ba
ang Power of Marketing Channel, ating alamin.
(NEXT SLIDE PLEASE)
 It's also called authority or the right command. Dito
BERNADETH:  naman naka based sa position yung isang authority
-POWER IN THE MARKETING CHANNEL ng isang namumuno. For example, a policeman
can arrest a citizen kase may job title siya or may
Kapag ginagamit natin ang termino na power sa   authority gawin ang bagay na yun .
marketing channel context, we are referring to the (NEXT SLIDE PO PLEASE)
capacity of a particular channel member to control
or influence the behavior of another channel Referent power- The simplest referent power
member. definition is a type of power that stems from a
Power is the ability of one channel member to get leader's ability to inspire and influence others. This
another channel member. authority comes from the extent to which people
That's why power is a potential for influence. Bakit admire, respect, and like a specific leader. You can
ito mahalaga? Kase dito makikita yung ibat ibang be a role model to your employees, because you
behavior ng channel members. have ability, skills that possibly give them
 (NEXT SLIDE PLEASE) motivation to be  better employees. You never
idolise someone who is a nugatory person.
Bases of power for channel control  (NEXT SLIDE  PLEASE)
Isa isahin natin  alamin ang limang power for
channel control  (NEXT SLIDE PLEASE)  Expert power - comes from having both deep
technical knowledge and extensive experience in
Una ang tinatawag na  reward power- Reward your field of expertise. When you're  expert in your
power is the formal power given to a work leader to field, people in your company naturally come to you
give out rewards to other employees. Ibig sabihin to benefit from your knowledge. Your expertise
nito the source of power is based sa position ng gives you credibility, and people trust and respect
isang channel manager sa isang kompanya. An your opinions. 
example of this is a manager or supervisor who Dito kapag hasa ka na sa bagay na yun halimbawa
incentivizes higher performance from employees magaling ka when it comes to graphic design
including bonuses, cash price or even simply people come to you because they know that you
recognition or compliment about the performance of are best in that things. 
their employees.  They can also use a tangible or (NEXT SLIDE PLEASE THANKYOU)
intangible reward. 
(NEXT SLIDE PLEASE) Using power in the marketing channel- From the
standpoint of the channel manager in the producing
Coercive power- The definition of coercive is or manufacturing firm, power must be used to
something related to the act of convincing someone influence the behavior of channel members towards
through threats, force or without regard to what helping the firm to achieve its distribution
they want to do.  objectives.  
This is a kind of power based on fear or fear of (NEXT SLIDE PO)
receiving a poor performance review.
Halimbawa; When your boyfriend says he is going Identifying the Available Power Bases
to break up with you if you don't buy him like PS3. Itong issues na ito ay usually madali makita.
Another example of this, Kapag sinabihan ka ng Generally, ginagawa ito based sa size ng producer
supervisor mo ng kailangan mo makabenta ng 100 na kaugnay sa channel member. Ang isang
na sapatos at kapag hindi mo na meet yung sales organisasyon o particular sa mga pangyayari sa
quota is tatanggalin na sa trabaho. This kind of surroundings ay malaking ang dulot sa channel
treatment is called coercive power.  relationship.
(NEXT SLIDE PO PLEASE)  Such difference in the amount of power available
does not mean that automatically they will take
Legitimate power- This power base stems from advantage of this power.  It merely indicates that
internalized norms in one channel member which they have the potential to do so.  
dictate that another channel member has a
legitimate right to influence the first, and that an Selecting and Using Appropriate Power Bases 
obligation exists to accept that influence.   -Which bases should be used to exercise power in
Also refers to ability to influence others because of the marketing channel is a more difficult and
the position one holds in the organization. complex issue for the channel manager to deal with
than the previous issue.  So, the manager needs to
know how effective the various power bases are in
influencing channel members to carry out the firm’s
distribution objectives, Common power tactics
include controlling access to information, controlling
access to persons, the selective use of objective
criterion, controlling the agenda, at iba pa. (NEXT
SLIDE)
Role in the marketing channel  senses.It's the basic tendency of people to interpret
 Dumako naman tayo kung ano ang dapat ipakita
na behavior ng isang channel members.
Roles in the marketing channel ay nag iiba.   From
the channel manager’s standpoint, the key value of
the role concept is that it helps to describe and
compare the expected behavior of channel
members and provides insight into the constraints
under which they operate. Karagdagan
acknowledges your behavior, personality, and your
performance in the company.
  (NEXT SLIDE PO)
Communication process in marketing channel-The
communication process itself consists of nine
elements – so alam na natin to, ito yung mga
sender, receiver, encoding, decoding, message,
media, response, feedback, and noise. Marketers
must know how to get through to the target
audience in the face of the audience's tendencies
toward selective attention, distortion, and recall
marketing messages.
(NEXT SLIDE PLEASE)
A).Differences in goals between channel members-
Channel members should attempt to understand
the goals of their channel members to learn
whether they are much different from those of their
own firms.   hours.
B). Differences in the kinds of language used to
convey information -The other basic communication
problem between the manufacturer and channel
members stems from the terminology or jargon
used by professional corporate management. The
channel manager has to ensure that the language
used in channel communications is well understood
by all channel members. Here when we use
different languages to the channel members we
must be sure that they understand the information
we gave to them.  sa Marketing Channel at mga Marketing Mix?
(NEXT SLIDE PO)
•Other Behavioral Problems in Channel
Communications 
Alamin naman natin ang tatlo uri ng behavioral
problems na maaaring hadlang sa epektibong
channel communications.
Perceptual Differences- While two people can
experience the same stimulus through the senses,
they may perceive the information differently.
Perceptual differences are the differences in ways
people process information gathered from the
others and perceive them in a different way. When
this happens, the way people communicate sa
kanila ay pwedeng magbago. These are called
perception or perceptual barriers of communication.
Iwasan den gamitin yung words  “everybody
knows” or “standard industry practice” will enhance
channel communications and minimize potential
conflicts. 
Secretive Behavior-A certain amount of secrecy is
often necessary because a firm needs the element
of surprise or members of the channel are also
members of competing channels or stock
competing items.   A channel manager must decide
these issues on an individual basis. 
Inadequate Frequency of Communication- Poor
communication leads to frequent second-guessing,
ignored tasks, duplicated jobs, lack of information,
and destructive rumors or negative rumors. A clear
flow of communication benefits everyone. Toxic
people spread negativity and suffocate the
positive.Poor communication often occurs when
there is a discrepancy between what is said and
what is heard. In other words, the person being
communicated to misunderstands what you're
communicating to them. Understanding is no longer
mutual. 
BERNADETH: Bernadeth Balon, nakatutok 24
CHIKA DORA
INTRODUCTION:
KRIZZTEL: Narito na ang mga chikang dapat
abangan sa 24 Hours. Ating pag uusapan ano nga
ba ang mga Diskarte sa Marketing Channel?  Isa-
isahin ang Six basic distribution decisions?  Ano
nga ba ang papel sa pamamahagi sa mga layunin
at diskarte ng kumpanya, Pagtukoy sa prayoridad
na ibinibigay sa pamamahagi at pang huli Diskarte
Mamaya na yan sa 24 Oras.
Para parating updated sa mga chika tumutok
lamang hanggang mamaya sa 24 Oras. (NEXT
SLIDE PLEASE)
KRIZZTEL:Ngayon ating pag usapan ano-ano nga
ba ang mga diskarte sa Marketing Channels.
Unahin muna nating talakayin ano nga ba ang
Marketing Channel Strategy (NEXT SLIDE
PLEASE)
KRIZZTEL:Marketing Channel Strategy is the
Broad principles by which the firm expects to
achieve it's distribution objectives for it's target
markets.
This definition focuses on the principles or
guidelines for achieving the firm's distribution
objectives rather than on its general marketing
objectives.
In the modern business world, maraming iba't-ibang
paraan, plataporma o campaign ang ginagamit ng
mga company para kumonekta sa target audience
nila.  or indirect sales channel strategy to build revenue.
Channel Strategy is about finding the best way to
expose your services, products and brand identity
to possible customers.  direktang magbenta sa customer.
For Example:
Kaming dalawa ni Frank sumali kami sa isang
network marketing company tapos yung product na
ibebenta ay isang bottled water. Tapos Ang sabe
ng owner ng company ay titignan nya saming
dalawa ni Frank kung sino yung may pinakamarami
samin na mabebenta sa pinakamabilis na oras ng
product na I ooffer namin. Yung product na
ibebenta namin which is yung bottled water ay hindi
dapat bababa sa 500 pesos yun kasi yung
suggested retail price so ngayon si Frank ang
ginawa nya pumunta siya sa mga Subdivision
pumunta sya sa mga Offices sa mga Public Places
sa mga matataong lugar pinuntahan nya yung mga
kaibigan at kamag anak nya para ialok yung 500
pesos na product which is yung bottled water. Ang
nangyari nakatanggap sya ng iba't-ibang klaseng
objections sabe sa kanya nung mga pinag alukan
nya "ANG MAHAL NAMAN NYAN!" "WALA
AKONG PERA" tas yung iba pinagtawanan pa sya.
Kaya ngayon si Frank frustrated sa bagong
business nya. Samantalang ako for example insip
ko muna ng mabuti kung sino yung mga tao na
magiging willing bumili ng product na inooffer yun
nga yung bottled water na 500pesos tapos ang
sunod na ginawa ko ay nagpunta ako ng disyerto at
inalok ko yung product na inooffer ko na  bottled
water don sa mga tao na 3 araw na di umiinom ng
tubig at uhaw na uhaw na. Sa tingin nyo
mabebenta ko ba ng mabilis yung product? Tingin
nyo kahit doblehin o triplehin ko pa yung presyo ng
product na binebenta ko ay bibili parin sila?
Syempre Oo Diba kasi may desire at need nila
yung product na inooffer ko. Sa tingin nyo sino
samin ni Frank yung magkaka resulta o magiging
successful sa bagong business na pinasok namin. 
Alam ko tong example na to ay medj exaggerated
pero yung point na gusto kong maintindihan nyo is
kapag yung prospect na pinagalukan mo ay yung
may desire o need na sa kung ano man yung
inooffer mo hindi ka na mahihirapan na magbenta
hindi mo na kailangan mag convince o kahit ano. 
Kaya nga Strategy Diskarte.
KRIZZTEL:There are many different types of
channel strategy to consider depende sa uri ng
negosyong pinapatakbo mo, at sa mga customer
na kailangan mong pagsilbihan. One of the first
decisions you'll need to make is wheather you're a
B2B (Business to Business) or B2C (Business to
Consumer) business.
Business to Business brands typically use a direct
Ang mga Direct sales ay ang pinakasimpleng
diskarte dahil pinapayagan nila na nagbebenta na
On the other hand, indirect sales involve using
channel partners and intermediaries to support
sales. An indirect sales channel strategy may
include using retail to sell through online or offline
store. Bukod pa dito, nagbebenta din ang ilang
business to business vendor sa pamamangitan ng
"value-added reseller" para mapahusay ang
kanilang access sa mga bagong customers.
In the world of Consumer sales the question "What
is channel strategy?" madalas na humahantong sa
iba't-ibang mga sagot. Karamihan sa Business to
Consumer company ay gagamit ng iba't-ibang
direct and indirect marketing strategies both online
and offline including Social Media and content
marketing.
An example of Business to Business ay isang
tagagawa ng chipset na nagbebenta ng mga
produkto nito sa ibang mga kumpanya. Ang
Business to Business ay ang term na ginamit
upang ilarawan ang isang relasyon sa negosyo sa
pagitan ng isang kumpanya at hindi bababa sa
isang individual consumer. An example of Business
to Consumer would be a travel agency that sells
flights to individual consumers. (NEXT SLIDE
PLEASE)
KRIZZTEL: To achieve it's objectives a firm will
have to address six basic distribution decisions:
1. What role should distribution play in the firm's
overall objectives and strategies?
- The key role that distribution plays is satisfying a
firm's customer and achieving a profit for the firm.
From a distribution perspective, ang kasiyahan ng
customer ay kinabibilangan ng pag maximize ng
oras at lugar na utility sa mga supplier ng
organization, mga intermediate na customer at final
customers.
2. What role should distribution play in the
marketing mix?
- Distribution mix plays an important role upang
mapataas ang halaga ng mga produkto sa
pamamangitan ng paghahatid ng mga goods in
right quantity, at right places and right time.
Distribution serves as link between producers and
consumers.
3. How should the firm's marketing channels be
designed to achieve it's distribution objectives?
- The primary purpose of any channel of distribution
is to efficiently bridge the gap between the producer
of a product and the user of it, wheather the parties
are located in the same community or in different
countries thousands of miles apart. (NEXT SLIDE
PLEASE)
KRIZZTEL:4. What kinds of channel members
should be selected to meet the firm's distribution
objectives?
- Ang channel member is one business in a
network of businesses na tumutulong sa isang
producer na i-channel ang kanilang product sa mga
consumer. Channel members, na kung minsan ay
tinatawag na mga tagapamagitan o middlemen, ay
nagtutulungan upang kumpletuhin ang iba't-ibang
gawain na kinakailangan upang makakuha ng
isang produkto mula sa produksyon hanggang sa
pagbebenta.
5. How can the marketing channel be managed to
implement the firm's channel design effectively and
efficiently on a continuing basis?
- An effective channel strategy ay maaring
makatulog sa mga company na mas mabilis na
lumaki, makakuha ng mga bagong customer at
pataasin ang mga benta sa pamamangitan ng
pagbibigay sa kanila ng access sa mas malaking
target audience of potential consumers.
6. How can channel members performance be
avaluated?
- Sales is the most popular performance criteria
used in channel evolution. Ang mga benta ay
maaring higit pang hatiin sa kasalukuyang mga
benta kumpara sa mga makasaysayang benta,
comparison of sales with other channel members,
and comparisons of channel member's sales with
predetermined quotas. (NEXT SLIDE PLEASE)
KRIZZTEL:Marketing Channel Strategy and the
Role of Distribution in Corporate Objectives and
Strategy
The most fundamental distribution decision for any
firm or organization ay ang papel na inaasahang
gampanan ng pamamahagi sa pangmatagalan
pangkalahatang objectives and strategy ng
kumpanya. The role of distribution should be
considered by the highest management levels of
the organization.
Kapag ang prosesong ito ng tatlong cycle na
pagpplano ay isinagawa sa isang malaki at sari-
saring kumpanya, lahat ng tatlong antas (yung
corporate, business, program and functional
department) ay magiging involved sa proseso ng
strategic planning. (NEXT SLIDE PLEASE)
KRIZZTEL:A.Determining the Priority Given to
Distribution
Distribution does increasingly warrant the attention
of top management, because competition has
made the issue of distribution too important for top
management to ignore. (NEXT SLIDE PLEASE)
KRIZZTEL:Marketing Channel Strategy and the
Marketing Mix
The role of Distribution must be considered in the
marketing mix along with price, promotion and
product.
The essense of modern marketing management:
To develop a marketing mix of product, price,
promotion, and distribution (place).
Marketing Channel Strategy one of the Four P's of
the marketing mix "place", along with product, price
and promotion comprises the set of decisions
made, and structures crated, na tumutulong sa
paglipat ng product or services ng isang tagagawa
mula sa lugar ng manufacturer to the ultimate end-
user.
Marketing Channel Strategy is all about selecting
the marketing touchpoints that match your target
audience's needs and habits. 
People in the Marketing Mix refers to anyone
directly or indirectly involved in the business side of
the enterprise. (NEXT SLIDE PLEASE)
KRIZZTEL:What we do know is that a general case
of stressing distribution strategy can be made if any
one of certain condition prevails:
1. Distribution is the most relevant variable for
satisfying target market demands
Firms should stress distribution when it serves
customer's need in the target market.
- Marketing Channels are so closely linked to
customer need satisfaction dahil ito ay sa
pamamangitan ng distribution na ang mga
kumpanya ay maaaring magbigay ng mga uri at
antas ng serbisyo na ginagawa para sa mga
nasisiyahang customers.
2. Parity exist among competitors in the other three
variables of the marketing mix.
Distribution advantages are not easily copied by
competitors.
- Distribution advantages are based on a
combination of superior strategy, organization and
human capabilities.
3. A high degree of vulnerability exist because of
competitor's neglect of distribution.
Competitor's neglect of distribution strategies
provides excellent opportunities.
- Dapat suriin ng mga channel manager Ang mga
target markets upang matukoy kung napabayaan
ng mga competitors ang distribution at kung
merong mga kahinaan na maaring
mapagsamantalahan.
4. Distribution can enhance the firm by creating
synergy from marketing channels.
"Hooking up" with a mix of cooperative channel
members will strengthen the channel.
- Dahil ang bawat channel member at isang
independent entity, may mga magandang
pagkakataon para sa mga channel manager na
linangin ang pakikipagtulungan sa mga members.
(NEXT SLIDE PLEASE)
KRIZZTEL:Here's a quote:
Tactics without strategy is the noice before defeat
OUTRODUCTION:
KRIZZTEL: Para sa ating susunod na chika Oli,
nagkwento tungkol sa channel strategy ng kanyang
business.
KRIZZTEL: ating makakapanayam ngayon si oli.
KRIZZTEL: oli kamusta naman ang iyong
business ?
OLIVER: so ayun maayos at tuloy tuloy parin sa
pagiimprove  available to the firm and all of its major functional
KRIZZTEL: ano ba ang sikreto mo bakit naging
successful ang business mo
OLIVER: Gumamit kase ako ng ibat ibang channel
strategy at designing channel
KRIZZTEL: Pero bago mo sabihin yan, isang
sayaw nga muna. Balita ko umabot na ng milyon
ang followers mo sa tiktok eh.  design of a superior marketing channel can yield a
KRIZTEL, JULIA, CLAIRE :  Sample! Sample!
(SUMAYAW NG PARO-PARO G)
OLIVER: Pinagpawisan ako dun ah. Hahahaha so
ayon na nga gumamit kase ako ng ibat ibang
channel strategy at designing channel. (NEXT
SLIDE PLEASE)
OLIVER: In improving and developing a business,
channel strategy is one of the important tool to
enhance and achieve the goal of the company. And
with that I believe Channel strategy should guide
channel design to help the firm to attain a
differential advantage. Dapat yung mga stratehiya
na iaapply mo is connected or either sumusunod
dun sa channel design ng Isang business. Kasi
kung tama yung channel strategy, mas maachive
yung differential advantage ng Isang business sa
competitors nito. (NEXT SLIDE PLEASE)
OLIVER: Pero first of all, ano nga ba ang
differential advantage at channel design?
Differential advantage is the firm’s attainment of an
advantageous position in the market relative to
competitors. In simple term ito yung advantage ng
Isang business sa competitors nito. It's either yung
quality nung Isang product o yung service
satisfaction ng isang customer. For example, isa rin
sa differential advantage ng isang business is yung
accessibility ng products through different locations
and modes. Just like the social media, kung saan
mas maeexpand pa yung products awareness sa
iba't ibang Lugar. So ayun yung differential
advantage ng isang business sa competitors nito. 
Next is the Channel design. It is the strategic
process that commercial organization use to
balance resources across direct and indirect
channels or routes to market. So ito yung iba't
ibang strategy para mas ma expand pa yung
distribution ng Isang product. Kung direct or indirect
channels yung iaapply sa Isang business. (NEXT
SLIDE PLEASE)
OLIVER: It is said that the entire range of resources
activities can contribute to the attempt to create a
differential advantage. So lahat ng operation and
activities ng Isang business ay malaking tulong
para makabuo ng advantage ng Isang produkto. 
And also a differential advantage based on the
formidable and long-term advantage kasi hindi yon
madaling magaya at makopya ng competitors ng
isang business. Kasi kung mag babase ka dun sa
nakaplan na marketing channel mas magiging
epektibo yung channel design para makabuo ng
pangmatagalan na differential advantages. (NEXT
SLIDE PLEASE)
OLIVER: So para makabuo at makagawa ng
differential advantage dapat maayos yung
positioning ng channels. But first ano nga ba yung
channel position at channel positioning. 
Channel position is the reputation a manufacturer
acquires among distributors  for furnishing
products, services, financial returns, programs, and
systems that are in some way superior to those
offered by competing manufacturers. So ito yung
position para makabuo ng differential advantage.
Including brokers, selling agents, wholesalers etc
para ma distribute yung products through different
locations. (NEXT SLIDE PLEASE)
OLIVER: Channel positioning is what the firm does
with its channel planning and decision making to
attain the channel position. Ito yung proseso na
nagdedecide kung pano makamit yung Isang
channel position ng Isang channel members. It's
objective is to establish the operation of channel
position effectively kung sa papaanong paraan para
mas ma motivate at ma encourage yung mga
channel members to do a great job. (NEXT SLIDE
PLEASE)
OLIVER: Dito naman po sa Selection of channel
members, The selection of channel members
should be consistent with the firm’s broader
marketing objectives and strategies and may also
need to reflect the objectives and strategies of the
organization as a whole.   among the channel members. (NEXT SLIDE
Sa pagpili ng channel members, dapat nagrereflect
yun sa objectives and strategies ng Isang
organization kasi diba kung basta basta lang yung
pagpili mo, para saan pa yung objective nung
position na pinag aaplyan and also yung goal nung
mismong business. (NEXT SLIDE PLEASE)
OLIVER: Channel management is the company's
engagement activities related to selecting enabling
and compensating indirect channels partners. It
involves all of the plans and actions taken by the
manufacturer aimed at securing the cooperation of
the channel members in achieving the
manufacturer’s distribution objectives.   the achievement of the distribution goals.
The channel manager attempting to plan and
implement a program to gain the cooperation of
channel members is faced with three strategic
questions: (NEXT SLIDE PLEASE)
OLIVER: First is, How close a relationship should
be developed with the channel members? Or the
closeness of channel relationship. Ito yung
closeness between the manufacturer and channel
members according sa distribution ng Isang
product. For example, the manufacturer wants to
enhance the accessibility of the product and
choose intensive distribution. So the manufacturer
should be close to the channel members involve on
it including all the middleman.
Next is, How should the channel members be
motivated to cooperate in achieving the
manufacturer’s distribution objectives? Or the
motivation of channel members. Bilang channel
manager, responsibilidad mo na imotivate yung
subordinate mo to achieve the distribution
objectives and it is not that easy. Kasi kung
malawak yung accessibility ng products it means
marami rin yung channel members which basically
you can't all manage. Pero bilang Isang manager
dapat kahit papano mamotivate mo sila para ma
achieve yung goal ng business.
 
And lastly, how should the marketing mix be used
to enhance channel member cooperation? Or the
use of marketing mix in channel management. Sa
paggamit ng marketing mix sa Isang business ay
Hindi lang malaking tulong para mareach yung
demand ng target market but also to enhance the
channel members cooperation. Kasi Hindi lang
effective strategy yung dapat magawa but also the
understanding of the relationships or interfaces
PLEASE)
OLIVER: Channel Strategy and the Evaluation of
Channel Member Performance 
Concerned only with the underlying strategic
significance of channel member performance
evaluation, which in practice is concerned with one
overriding question: Have provisions been made in
the design and management of the channel to
assure that channel member performance will be
evaluated effectively?  So ito na yung last process
kung saan evaluation nung naging performance
nung Isang channel members kung naisagawa ba
ng ayos yung trabaho and also if it contributes to
CHAPTER 6: STRATEGY IN MARKETING CHANNELS
Channel strategy refers to the broad principles
by which the firm expects to achieve its distribution
objectives for its target markets. It focuses on the
“place” variable in the four Ps of marketing. Channel
strategy is relevant to all six of the basic distribution
decisions faced by firms:
1) the role of distribution in the firm’s overall objectives
and strategies,
2) the role of distribution in the marketing mix,
3) the design of marketing channels,
4) the selection of channel members,
5) management of the channel, and
6) evaluation of channel member performances.
In terms of the design of marketing channels,
channel strategy should guide the design process in an
attempt to gain a differential advantage for the firm
using superior channel design.
Marketing channel strategy: The broad
principles by which the firm expects to achieve its
distribution objectives for its target markets.
This definition focuses on the principles or
guidelines for achieving the firm’s distribution
objectives rather than on its general marketing
objectives. Thus, marketing channel strategy is
concerned with the place aspect of marketing strategy.
To achieve its objectives a firm will have to address six
basic distribution decisions:
1. What role should distribution play in the firm’s
overall objectives and strategies?
2. What role should distribution play in the marketing
mix?
3. How should the firm’s marketing channels be
designed to achieve its distribution objectives?
4. What kinds of channel members should be selected
to meet the firm’s distribution objectives?
5. How can the marketing channel be managed to
implement the firm’s channel design effectively and
efficiently on a continuing basis?
6. How can channel member performance be
evaluated?
A sound approach to dealing with distribution
decisions is to formulate marketing channel strategy to
provide the guiding principles for dealing with
distribution decisions on a proactive rather than a
reactive basis.
Marketing Channel Strategy and the Role of
Distribution in Corporate Objectives and Strategy
The most fundamental distribution decision for
any firm or organization to consider is the role that
distribution is expected to play in a company’s long-
term overall objectives and strategies. The role of
distribution should be considered by the highest
management levels of the organization.
When this three-cycle planning process is
undertaken in a large and diversified firm, all three
levels (corporate, business, and program and functional
departments) will become involved in the strategic
planning process.
A) Determining the Priority Given to Distribution
The question of how much priority to place on
distribution is one that can be answered only by the
particular firm involved. While there are no general
guidelines and no body of empirical research to indicate
when distribution should be viewed as a critical factor in
a firm’s long-term strategic objectives, there is however,
a growing belief among top management experts that
distribution does warrant the attention of top
management,because competition has made the issue
too important to ignore.
What is fair to say, however, is that to
automatically dismiss distribution as a decision area for
top management concern in formulating corporate
objectives and strategies limits the firm’s ability to
compete effectively in today’s global markets.
Marketing Channel Strategy and the Marketing Mix
The role of distribution must be considered in
the marketing mix along with price, promotion, and
product. How much emphasis to be placed on place has
no general answer. Each firm or marketing manager
must make that determination for his or her self.
What we do know is that a general case of stressing
distribution strategy can be made if any one of certain
conditions prevails:
1) Distribution is the most relevant variable for
satisfying target market demands.
2) Parity exists among competitors in the other three
variables of the marketing mix.
3) A high degree of vulnerability exists because of
competitors’ neglect of distribution.
4) Distribution can enhance the firm by creating synergy
from marketing channels.
1) Distribution Relevance to Target Market Demand
As firms have become more orientated to target
markets over the past two decades by listening more
closely to their customers, the relevance of distribution
has become apparent to an increasing number of
companies because it plays such a key role in providing
customer service.
Why are marketing channels so closely linked to
customer need satisfaction? Because it is through
distribution that the firm can provide the kinds of levels
of service that make for satisfied customers.
2) Competitive Parity in Other Marketing Mix Variables
It is increasingly more difficult for a company to
differentiate its marketing mix from that of the
competition. Price, product, and promotional strategies
can easily and quickly be copied.
wholesale or retail levels, the manufacturer
immediately upgrades its own credibility. In effect, the
manufacturer’s products handled by the famous
retailers or well-established wholesalers become
“anointed” as superior products to a degree beyond
what the manufacturer could have accomplished on its
own.
Synergy through distribution goes well beyond
the enhancement of the manufacturer’s image. Strong
and close working relationships between the
manufacturer and channel members – which in recent
years have been referred to increasingly as distribution
partnerships, partnering, strategic alliances or networks
– can provide a substantial strategic advantage.

Distribution (place), the fourth variable of the Channel Strategy and Designing Marketing Channels
marketing mix, can offer a more favorable basis for
Channel strategy should guide channel design to help
developing a competitive edge because the advantages
the firm attain a differential advantage.
achieved in distribution are not as easily copied by
competitors as the other three. Why is this the case? 1) Differential Advantage and Channel Design
Distribution advantages, if manifest in a superior
 Differential advantage: Also called sustainable
marketing channel (rather than just the logistical
competitive advantage, this refers to a firm’s
aspects of distribution), are based on a combination of
attainment of an advantageous position in the market
superior strategy, organization, and human capabilities.
relative to competitors –a place that enables it to use its
This is a combination not easily or quickly imitated by
particular strengths to satisfy customer demands better
competitors.
than its competitors on a long-term (sustainable) basis.
3) Distribution Neglect and Competitive Vulnerability
The entire range of resources available to the firm and
Neglect of distribution strategy by competitors all of its major functional activities can contribute to the
provides an excellent opportunity for those companies attempt to create a differential advantage.
who are willing to make the effort to develop
Channel design, though just one component of this
distribution as a key strategic variable in the marketing
attempt to gain a differential advantage should
mix.
nevertheless be viewed as a very important part.
But to pursue this approach, the channel
A differential advantage based on the design of a
manager has to make a conscious effort to analyze
superior marketing channel can yield a formidable and
target markets to determine if distribution has been
long-term advantage because it cannot be copied easily
neglected by competitors and whether vulnerabilities
by competitors.
exist that can be exploited.
2) Positioning the Channel to Gain Differential
4) Distribution and Synergy for the Channel
Advantage
By “hooking up” with the right kind of channel
 Channel position: “The reputation a manufacturer
members, the marketing mix can be substantially
acquires among distributors (channel members) for
strengthened to a degree not easily duplicated with
furnishing products, services, financial returns,
other variables.
programs, and systems that are in some way superior to
The most obvious example of this is when a those offered by competing manufacturers.”
channel member’s reputation or prestige is stronger
than the manufacturers. By securing distribution of its
products through such channel members at the
Channel positioning: “What the firm does with its
channel planning and decision making to attain the
channel position.”
The key is to view the relationship with channel
members as a partnership or strategic alliance that
offers recognizable benefits to the manufacturer and
channel members on a long-term basis.
By thinking in terms of channel positioning, the channel
manager takes a longer-term strategic view of channel
design and is more likely to ask the question: How can I
design the channel so that channel members will view
my firm as having done a better job than the
competitive manufacturers they represent?
Channel Strategy and the Selection of Channel
Members
The approach taken to channel member
selection and the particular types of intermediaries
chosen to become channel members should reflect the
channel strategies the firm has developed to achieve its
distribution objectives.
Moreover, the selection of channel members
should be consistent with the firm’s broader marketing
objectives and strategies and may also need to reflect
the objectives and strategies of the organization as a
whole.
This follows because channel members, thought
independent businesses, are from the customer’s
perspective an extension of the manufacturer’s own
organization.
A firm such as Rolex can be selective in choosing
its channel members. On the other hand, if a
manufacturer’s products are “middle of the road” in
quality and aimed at the mass market, its distribution
strategy should stress broad coverage of the market.
Channel Strategy and Managing the Marketing
Channel
Channel management from the manufacturer’s
perspective involves all of the plans and actions taken
by the manufacturer aimed at securing the cooperation
of the channel members in achieving the
manufacturer’s distribution objectives.
The channel manager attempting to plan and
implement a program to gain the cooperation of
channel members is faced with three strategic
questions:
 How close a relationship should be
developed with the channel members?
 How should the channel members be
motivated to cooperate in achieving the
manufacturer’s distribution objectives?
 How should the marketing mix be used
to enhance channel member
cooperation?
1) Closeness of Channel Relationships
How close a channel relationship any given
manufacturer should develop with its channel members
is really a question of strategy.
If a channel member believes that a close
working relationship will help him or her do a better job
of managing the channel and achieve the distribution
objectives, then closeness should be emphasized.
On the other hand, if the channel manager
believes that closeness is not necessary for effective
management of the channel, then it is probably a waste
of time and money to do so.
As a rough strategic guide for dealing with the
closeness question, the channel manager can relate it to
the degree of distribution intensity needed for the
manufacturer’s products.
Distribution intensity is not, of course, the only
factor to consider in deciding how close a relationship
the manufacturer should develop with the channel
members. Many other factors, such as markets being
targeted, products, company policies, middlemen,
environment, and behavioral dimensions can play a
role.
2) Motivation of Channel Members
When motivating channel members, whether at
the wholesale or retail levels, the strategic challenge is
to find the means to secure strong channel member
cooperation in achieving distribution objectives.
Channel strategy in this context involves whatever ideas
and plans the channel manager can devise to achieve
that result.
From the diverse array of channel tactics
shown, the channel manager must decide which to use
to effectively motivate the channel members.
 The distribution portfolio analysis (DPA) has
been borrowed from finance and applied in the context
of marketing channels. While DPA provides a
comprehensive method for categorizing channel
members, the essence of DPA is that it can help the
channel manager focus more insightfully on the channel
members by viewing all of the channel structures
and/or channel members as the portfolio.
The essential idea behind the portfolio
approach to channel member motivation is that
different types and sizes of channel members
participating in various channel structures may respond
differently to various motivational strategies.
Although the channel portfolio concept
provides a useful framework for determining which
motivational approaches might be useful for various
classes of channel members, the channel manager
should not lose sight of the final customer which, after
all, is the real reason for developing an appropriate mix
of channels and strategies in the first place!
3) Use of the Marketing Mix in Channel Management
Optimizing the marketing mix to meet the
demands of the target market requires not only
excellent strategy in each of the four strategic variables
of the marketing mix, but also an understanding of the
relationships or interfaces among them.
From the standpoint of distribution and
particularly of managing the marketing channel, the
channel manager should keep the strategic concept of
developing synergy clearly in mind.
Channel Strategy and the Evaluation of Channel
Member Performance
At this point in the text, we are concerned only
with the underlying strategic significance of channel
member performance evaluation, which in practice is
concerned with one overriding question: Have
provisions been made in the design and management of
the channel to assure that channel member
performance will be evaluated effectively?
This question will direct the channel manager’s
attention toward viewing performance evaluation as an
integral part of the development and management of
the marketing channel rather than as an afterthought.
CHAPTER 7 SELECTING CHANNEL PARTNERS
TARGET MARKETS AND CHANNEL DESIGN STRATEGY
How Customer Buy?
For decades, giant big-box retailers like Walmart
supercenters, Best Buy, Home Depot
and many others emphasized building bigger with
broader assortments of merchandise and low prices to
attract customers.
But in recent years, customers pressed for time
and having easy access to an extensive array of online
channels are becoming frustrated with the difficulties of
navigating their way through these giant retail stores,
especially when they can’t find all of the items, they
have on their shopping lists.
One study by Walmart, for example, found that
an average shopper at a Walmart, supercenters spend
21 minutes in the store but finds only 7 of the 10 items
on her or his shopping lists. There is growing concern
among big-box retailers that the consumer’s desire for a
convenient and efficient shopping experience could
undermine the big-box retail channel in the future
1. When customer buy
 Frequently there are seasonal, weekly and daily
variations. Weekly and daily variations in buyer
behavior are common at the retail level and
vary across different trade areas throughout the
country.
 Two implications for the channel manager are
related of when Customer Buy.
1) Seasonal variations tend to create peaks and valleys
in the manufacturer’s production scheduling. Typically,
the manufacturer would like to smooth out these peaks
and valleys in production because this will usually lower
average production costs.
2) Particular relevance in the selection phase of channel
design. The channel manager should try to avoid
selecting channel members who are out of touch with
the time demands of the markets they serve
He Target Market and Channel Design Strategy
2. Where Customer Buy
Research on where customers buy is often
based on the assumption that they will behave so as to
maximize their convenience in the selection of retail
outlets. That is, the consumer is seen as engaged in
balancing the desirability of near and distant retailers
again the cost, time and energy that must be spent in
overcoming distance. If this cost is too high for
patronizing a distant store, the customer will seek one
that is closer. For example, giant big-box retailers like
Walmart, the world’s largest retailer. For decades, this
giant retailer has been famous for big-box stores in the
suburbs. Now it plans to open hundreds of much
smaller stores in urban areas across the U.S.
Why is Walmart doing this? Millions of
consumers in urban areas, many of whom are in the
lower income brackets, are looking for convenience.
They want stores right in their neighborhoods that offer
good selection and low prices. The high cost of gasoline
has accelerated this demand.
3. Who Buys
 Who participates in the buying decision
The more difficult aspect to analyze than who
actually makes the physical purchase. At the consumer
level, the question of who take part in the buying
decision revolves around the roles played by the
husband, wife, sometimes the children. Best Buy Co., in
an attempt to learn more about the role of females in
buying decisions, has established what Best Buy calls
“Women’s Leadership Forums” loose-knit groups of
female employees and customers that meet periodically
all over the country. These groups hold discussion that
help to identify the female perspective in the consumer
decisions process
The Target Market and Channel Design Strategy
4. How Customer Buy
 More affluent consumers are also likely to
demand more assistance from salespeople than
less affluent consumers who are amenable to
more self-service in many product categories.
Several of patterns have been changing
overtime, such as the general shift to one-stop
shopping, using credit and debit cards instead
of cash and making more use of the internet for
online shopping. The same pattern may also
hold for mobile or Ecommerce channels.
 Significant changes have also been occurring
for specific segments of the market. For
example, good personal selling at the retail
level may be making a comeback at least in the
department and specialty store sectors. Such
famous store as Bloomingdale’s and Neiman
Marcus appears to be increasing consumer
demand for knowledgeable and helpful
salespeople.
MOTIVATING THE CHANNEL PARTNERS
The channel manager needs to stress the
realization of the potential to serve his target markets
effectively and efficiently.
Channel management: “The administration of
existing channels to secure the cooperation of channel
members in achieving the firm’s distribution objectives.”
First, channel management deals with existing
channels. Channel design decisions are therefore
viewed as separate from channel management
decisions.
Secondly, the phase secures the cooperation of
channel members implies that channel members do not
automatically cooperate merely because they are
members of the channel. Administrative actions are
necessary to secure their cooperation.
Third, the term distribution Objectives is equally
relevant for channel management. Carefully delineated
distribution objectives are needed to guide the
management of the channel.
One of the most fundamental and important
aspects of channel management is motivating the
channel members.
 Motivation: Refers to the actions taken by the
manufacturer to foster channel member
cooperation in implementing the
manufacturer’s distribution objectives.
There are three basic facets involved in motivation
management:
1. Finding out the needs and problems of channel
members
2. Offering support to the channel members that is
consistent with their needs and problems
3. Providing leadership through the effective use of
power
Finding Out the Needs and Problems of Channel
Members
 Before the channel manager can successfully Franchise Marketing Channel
motivate channel members, an attempt must be made
Marketing Channels for Services
to learn what the members want for the channel
relationship. Manufacturers are often unaware of or Global Marketing Channels
insensitive to the needs and problems of their channel
members. CHAPTER 8

A) Research Studies of Channel Members EVALUATING CHANNEL MEMBERS PERFORMANCE

Most manufacturers never conduct research of Online Channels Systems and Management
channel member needs and problems. Estimates Topic 1: Electronic Marketing Channels
indicate that less than one percent of manufacturers’
research budgets are spent on channel member Technology – Computers
research. . – Internet
B) Research Studies by Outside Parties Impact on Design and Management of Marketing
Research designed and executed by a third Channels
party is sometimes necessary if complete and unbiased
data on channel member needs and problems are to be
obtained. The use of outside parties to conduct
research on channel member needs and problems
provides higher assurance of objectivity.

C) Marketing Channel Audits

The basic thrust of this approach should be to

gather data on how channel members perceive the
manufacturer’s marketing program and its component
parts, where the relationships are strong and weak, and
what is expected of the manufacturer to make the
channel relationship viable and optimal.

For example, a manufacturer may want to

gather data from channel members on what their needs
and problems are in areas such as:

  Pricing policies, margins, and allowances

  Extent and nature of the product line
  New products and their marketing
development through promotion
  Servicing policies and procedures such as
invoicing, order dating, shipping, warehousing
and others
 Sales force performance in servicing the
accounts

CHAPTER 8 EVALUATING CHANNEL MEMBERS

PERFORMANCE

Online Channels Systems and Management

ELECTRONIC MARKETING CHANNELS

Developments or Trends in EMC

 Online shopping to $134 billion from mid-

1990s to the end of 2009*
 Online shopping has become a routine
shopping choice*
 PCs, peripherals, software, & books accounted
for a significant portion of total retail spending
on these products
 U.S. Department of Commerce