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A marketing channel acts as a differentiating factor and provides businesses with a competitive advantage. Marketing channels comprise several individuals and interdependent organizations that facilitate the process of making a product or service available to end users. Marketing channels have evolved over time, from being production-oriented to customer- centric.. The evolution of marketing channels has primarily been a response to changes taking place in businesses due to the environment.
As the product moves through different stages, different members in the distribution channel perform the functions of exchange, logistics and other supporting functions.
Designing an appropriate marketing channel is crucial to the success of a business. The channel design has to be meticulously planned taking into consideration the channel functions and other strategic business objectives. The most important elements in channel design are channel structure, channel intensity and the type of intermediaries at each level.
Marketing channels ensure the smooth flow of products between channel members. In the process, a marketing channel witnesses eight basic types of flows. These are flow of possession, ownership, promotion, negotiation, financial, risk, ordering and payment. Each flow is associated with certain costs. Therefore, it is necessary that marketing channels be designed to eliminate redundancy of flows.
Evolution Of Marketing Channels
The Production Era
The Sales Era
The Marketing Era
Relationship Marketing Era
Channel Members and Their Roles
Roles of Channel Members
Designing Marketing Channels
Types of Channel Intermediaries at Each Level
Channel Flows and Costs