Professional Documents
Culture Documents
Conflict
By: B D Nathani
Challenges in exercising power and
achieving control in marketing channels
• Loose alignment between channel
members
• Central direction is lacking
• Single ownership is often missing:
intensity
• Formal authority is absent
• Reward and penalty system is not
precise
• Central planning is rare.
2
Roles in Marketing Channels
Reward Power
Coercive Power
Legitimate Power
Referent Power
Expert Power
Using Power in the Marketing Channel
A’s Level of
Investment in: DEPENDENCE
Coercion OF B ON A
Reward
Legitimacy
Expertise
A’s Offering to B:
Reference
Coercion Reward
Legitimacy Expertise
Reference
Competitive
Levels of: POWER OF
Coercion A OVER B
Reward
Legitimacy
Expertise
Reference
• Countermeasures for balancing
power asymmetry*
• Develop alternative sources
• Organize a coalition with other firms
• Walk out of the relationship!
• Raise the other party’s dependence
on you
Behavioral Problems in
Channel Communications
2.
1.
Differences in
Differences in goals
the kinds of
between
language they use
manufacturers &
to convey
their retailers
information
Communication Processes (cont’d)
Behavioral Problems in
Channel Communications
3. 5.
Perceptual 4. Inadequate
differences Secretive frequency
among behavior of
members communication
• Major Sources of Channel Conflict*
–Competing Goals
–Different Perceptions of Reality
–Clashes over Domains: Intrachannel
competition
–Multiple channels and Gray market
–Threats by Channel Partner
Detecting
conflict
Appraising the
effect of
conflict
Resolving
conflict
Managing
Conflict
• Conflict Resolution Strategies
1. Information-intensive mechanisms:
DAC, Personnel exchange
2. Third-party mechanisms: mediation
and arbitration
3. Building Relational norms: flexibility,
solidarity
Compromise
Avoidance
Competition Assertiveness:
Concern for one’s
or
own outcomes
Aggression
Low Cooperativeness
Based on Thomas (1976)
• Key Qualitative Outcomes
– Trust
– Satisfaction
– Commitment
CONFLICT _
Level of tension, frustration, ECONOMIC SATISFACTION
disagreement in relationship of focal firm: positive affective
experienced by focal firm response to financialrewards
derived from relationship or
_ economic gratification
_
TRUST
Focal Firm’s belief in
counterpart’s honesty and _ NON-ECONOMIC
benevolence SATISFACTION
+
of focal firm: positive affective
response to psycho-social aspects of
COMMITMENT relationship, or gratification from
Focal Firm’s desire to continue non-financial sector
relationship and to sacrifice
to build and maintain it