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2. PRODUCT DIMENSIONS
bulk and weight
perishability
unit value
newness
3. COMPANY DIMENSIONS
Size
Financial capacity
Managerial expertise
Objectives and strategies
4. INTERMEDIARY DIMENSIONS
Availability
Cost
Services
5. ENVIRONMENTAL DIMENSIONS
Defining the customer needs
Channel alternatives
It includes:
Product information
Product customisation
Product quality assurance
Lot size
Product variety
Spacial convenience
Waiting and delivery time
After sales service
logistics
2. DEFINING CHANNEL OBJECTIVES:
Perishable product requires more direct marketing.
Bulky products, such as buildings materials require channels that minimize the shipping
distance and amount of handling.
Non-standard products such as custom built machinery and specialised business forms, are
sold directly by company sales representatives.
High-unit value products such as generators and turbines are often sold through a company
sales force rather than intermediaries.
3. CHANNEL ALTERNATIVES:
at the time of deciding, the company will scan for:
i) types of intermediaries
ii) number of intermediaries
iii) cost of channel system
iv) terms and responsibilities of channel members.
4. EVALUATION OF MAJOR ALTERNATIVES:
Economic criteria
Control criteria
Adaptive criteria
With the completion of forgoing steps, the number of alternatives would have narrowed
down considerably. The firm must evaluate, design and chose the best among them.
SEGMENTATION
POSITIONING
Occurs when the channel manager defines the optimal channel to serve the needs of end-
users as segmented by their service output demands.
TARGETING
At this stage of analysis it becomes important to not only determine what segments to target, but
which segments to ignore.
When preexisting channels are in place in the market, it is important to perform a gap analysis. If
a new channel is being formed, the goal is to strive for zero-based.
Gap Analysis = Δ of zero-based vs. actual channels on the demand and supply side.
IDENTIFY POWER SOURCES
The role of the channel manager is to continuously and dynamically manage channel
initiatives and relationships via realms of influence over channel power.
The company must sell not only through the intermediaries but also
to/with them
Develop a cooperative/collaborative and balanced relationship with the
partner
Understand the partner’s customers – their needs, wants, and demands
Understand the partner’s business – operationally and financially and
what’s really important to them
Look at the partner’s needs in terms of customer support, technical
support, and training
Establish clear and agreed upon expectations and goals
Develop recognition programs focusing on the partner’s contributions
Build internal support systems and dedicate resources to the partner
Produces must evaluate intermediaries performance against such standards as:
Sales quota attainment
What is working?