Marketing Channel Strategy

Robert W. Palmatier is Professor of Marketing and John C. Narver Endowed Professor in Business Administration at the Foster School of Business, University of Washington, USA and the Research Director of the Sales and Marketing Strategy Institute.Eugene Sivadas is Professor of Marketing and Associate Dean at the Milgard School of Business, University of Washington Tacoma, USA.Louis W. Stern is John D. Gray Distinguished Professor Emeritus of Marketing at the Kellogg School of Management, Northwestern University, USA.Adel I. El-Ansary is the Donna L. Harper Professor of Marketing at the University of North Florida, USA.

• List of Tables, Figures, and Appendices Preface CHAPTER 1: The Omni-Channel EcosystemLearning ObjectivesIntroductionWhat Is a Marketing Channel?The Changing Channel LandscapeMarketing Channel ActorsManufacturers: Upstream Channel MembersIntermediaries: Middle Channel MembersWholesalersRetail IntermediariesSpecialized IntermediariesEnd-Users: Downstream Channel MembersCombinations of Channel MembersOnline ChannelsFrom a Multi-Channel to an Omni-Channel WorldDistinction Between Multi-Channel and Omni-Channel Marketing Strategies: Trends Driving the ShiftTrend 1: Channel Participants Operate in a Connected WorldTrend 2: Cross-Channel ShoppingTrend 3: Altered Shopping NormsTrend 4: Moving into ServicesTrend 5: Targeted Promotions and Customer InsightsChannel Strategy FrameworkTake-AwaysCHAPTER 2: Channel BasicsLearning ObjectivesIntroductionThe Importance of Marketing Channel StrategiesWhy Do Marketing Channels Exist?Benefits for Downstream Channel MembersSearch FacilitationSortingBenefits to Upstream Channel MembersRoutinization of TransactionsFewer ContactsThe Key Functions Marketing Channels PerformChannel FunctionsDesigning Channel Structures and StrategiesAuditing Marketing ChannelsAuditing Channel Functions Using the Efficiency TemplateEvaluating Channels: The Equity PrincipleEvaluating Channels: Zero-Based Channel ConceptAuditing Channels Using Gap AnalysisSources of Channel GapsService GapsCost GapsCombining Channel GapsEvaluating Channels: Gap Analysis TemplateMake-or-Buy Channel AnalysisAuditing Omni-ChannelsTake-AwaysCHAPTER 3: Channel PowerLearning ObjectivesIntroduction: The Nature of Marketing ChannelsPowerPower as a ToolThe Five Sources of Channel PowerReward PowerCoercive PowerExpert PowerLegitimate PowerReferent PowerDependence as the Mirror Image of PowerDefining DependenceMeasuring DependenceUtility and ScarcityPercentage of Sales or ProfitsRole PerformanceBalancing Power: A Net Dependence PerspectiveImbalanced DependenceStrategies for Balancing DependenceStrategies for Tolerating Imbalanced DependencePower-Based Influence StrategiesOmni-Channels and PowerTake-AwaysCHAPTER 4: Channel RelationshipsLearning ObjectivesIntroductionWhy Do Relationships Matter in Marketing Channels?Upstream Motives for Building a Strong Channel RelationshipDownstream Motives for Building a Strong Channel RelationshipBuilding Channel Commitment Need for Expectations of ContinuityNeed for Reciprocation: Mutual CommitmentStrategies for Building CommitmentHow Downstream Channel Members CommitHow Upstream Channel Members CommitBuilding Channel TrustNeed for Economic SatisfactionStrategies for Building Channel Partners’ TrustRole of Noneconomic FactorsDecision-Making ProcessesOvercoming Channel DistrustPreventing Perceptions of UnfairnessThe Channel Relationship LifecycleThe Five Stages of a Channel RelationshipManaging the StagesManaging Troubled RelationshipsRelationship PortfoliosRelationship QualityMulti-Channel Versus Omni-Channel RelationshipsTake-AwaysCHAPTER 5: Channel ConflictLearning ObjectivesIntroductionThe Nature of Channel Conflict Types of ConflictMeasuring ConflictConsequences of ConflictFunctional Conflict: Improving Channel PerformanceManifest Conflict: Reducing Channel PerformanceMajor Sources of Conflicts in ChannelsCompeting GoalsDiffering Perceptions of RealityIntrachannel Competition Omni-ChannelsIdentifying Multi-Channel ConflictsManaging Multiple ChannelsUnwanted Channels: Gray MarketsMitigating the Effects of Conflict in Balanced RelationshipsConflict Resolution StrategiesForestalling Conflict through InstitutionalizationInformation-Intensive MechanismsThird-Party MechanismsBuilding Relational NormsUsing Incentives to Resolve ConflictsTake-AwaysCHAPTER 6: Retailing Structures and StrategiesLearning ObjectivesThe Nature of RetailingClassification of RetailersSupermarketsWarehouse ClubsDepartment StoresSpecialty StoresFull Line Discount StoresConvenience and Drug StoresThe Retail LandscapeThe Big PlayersModern Shifts and ChallengesRetail Positioning StrategiesCost-Side Positioning StrategiesDemand-Side Positioning StrategiesBulk-BreakingSpatial ConvenienceWaiting and Delivery TimeProduct VarietyCustomer ServiceRetail ChannelsInternet Retail Channels & E-CommerceDirect Selling ChannelHybrid Retail ChannelsRetailer Power and Its EffectsEffect on Forward BuyingEffect on Slotting AllowanceEffect on Failure FeesEffect on Private BrandingRetailing Structures and StrategiesTake-AwaysCHAPTER 7: Wholesaling Structure and StrategiesLearning ObjectivesIntroductionWhat Is a Wholesaler?How Are Wholesalers Different from Distributors?The Wholesaler-Distributor LandscapeMaster DistributorsOther Supply Chain ParticipantsWholesaling StrategiesA Historical Perspective on Wholesaling StrategyWholesaling Value-Added StrategiesAlliance-Based Wholesaling StrategiesWholesaler-Led InitiativesManufacturer-Led InitiativesRetailer-Sponsored CooperativesConsolidation Strategies in WholesalingAdapting to Trends in WholesalingInternational ExpansionOmni-ChannelsB2B Online ExchangesOnline Reverse AuctionsFee for ServicesVertical Integration of Manufacturing into WholesalingTake-AwaysCHAPTER 8: Franchising Structure and StrategiesLearning ObjectivesFranchising FormatsProduct and Trade Name FranchisingBusiness Format FranchisingThe Franchising ArrangementBenefits of FranchisingTo FranchiseesStart-Up PackageOngoing BenefitsCompetitive Advantages of FranchisingTo FranchisorsFinancial and Managerial Capital for GrowthHarnessing the Entrepreneurial SpiritReasons Not to FranchiseFranchising StrategiesFranchising Contracting StrategiesPayment SystemsLeasingTerminationContract ConsistencyContract EnforcementSelf-Enforcing AgreementsCompany Store StrategiesMarket DifferencesTemporary Franchise and Company OutletsPlural Forms and SynergiesExploiting Franchises with Company OutletsAdapting to Challenges in FranchisingSurvival TrendsMaintaining a Cooperative AtmosphereManaging Inherent Goal ConflictMulti-Unit FranchisingFranchising and Omni-ChannelsTake-AwaysCHAPTER 9: Channels and International MarketsLearning ObjectivesIntroductionKey Middlemen in International Business Export Management CompaniesExport Trading CompaniesPiggybackingInternational RetailingInternational FranchisingInternational Distribution ChallengesThe Role of the WholesalerMarketing to the Base of the PyramidDefining the MarketEthical Considerations at the BOPDistribution to the BOPOmni-Channel and Global MarketingTake-AwaysCHAPTER 10: End-User Analysis: Segmenting and TargetingLearning ObjectivesIntroduction: Understanding the Importance of Channel SegmentationEnd-User Segmentation Criteria: Service Outputs Bulk BreakingSpatial ConvenienceWaiting or Delivery TimeProduct Variety and AssortmentCustomer ServiceInformation SharingSegmenting End-Users by Service OutputTargeting End-User SegmentsOmni-Channels and End-User SegmentsTake-AwaysCHAPTER 11: Omni-Channel StrategyLearning ObjectivesIntroduction Key Challenges of the Omni-Channel ApproachThe Four Pillars of an Omni-Channel Strategy Harnessing Customer KnowledgeLeveraging TechnologyManaging Channel RelationshipsAssessing Channel PerformanceTake-AwaysIndex

"Marketing Channel Strategy: An Omni-Channel Approach is fresh, insightful, and packed with information. The material is easy to read and digest and flows well. Readers will walk away with a clear understanding of the omni-channel ecosystem and how to build effective omni-channel strategies. The role and impact of omni-channels on each sector of the channel landscape is clearly laid out. The book is built on solid theoretical foundation but is very managerial at the same time." –Rajdeep Grewal, The Townsend Family Distinguished Professor and Area Chair, Marketing Editor-in-Chief, Journal of Marketing Research, Kenan-Flagler Business School, University of North Carolina-Chapel Hill, USA"Marketing Channel Strategy: An Omni-Channel Approach is a very readable and updated take on a classic text. Omni-channels are growing in importance, and they fundamentally change the way firms go to market and connect with their customers. Unfortunately, however, there are few available frameworks to guide managerial decision-making in this area. This book draws on current academic research and industry practice to develop a compelling strategic framework that fills this void in the literature. The framework’s guiding principle is the idea of an omni-channel ‘ecosystem,’ and the authors apply it to a variety of different channel contexts, including wholesaling, franchising, and retailing. The book is packed with insights, and the authors do an excellent job of illustrating them with current examples." –Jan B. Heide, Michael Lehman Distinguished Chair in Business, Wisconsin School of Business, University of Wisconsin-Madison, USA"This leading textbook on marketing channels is completely redone and offers a unique take on channel marketing management in the light of the present-day reality. Marketing Channel Strategy: An Omni-Channel Approach builds a model that shows students and practicing managers how to engage and make the customer experience seamless across multiple channels. I find the chapter on international channels and base of the pyramid particularly informative, pragmatic, and interesting. The book is modular and can be used in a variety of classes including retailing, international marketing, channels, e-marketing, and marketing strategy." –Constantine S. Katsikeas, Arnold Ziff Research Chair and Professor of Marketing and International Management, University of Leeds, UK"Effective omni-channel management is a critical source of value and an important differential edge in the modern marketplace. Given the trends toward omni-channel ecosystems, it is key that managers and managers-in-training (i.e., students) focus more of their attention on channel management. This cutting-edge text can be a catalyst for renewed interest in channel management; it highlights the need for a greater focus on this element of the go-to-market marketing strategy." Dhruv Grewal, Toyota Chair of Commerce and Electronic Business and Professor of Marketing, Babson College, USA"Marketing Channel Strategy: An Omni-Channel Approach blends theory with practice-oriented examples to clearly enunciate the difference between a multi-channel and omni-channel worldview. The examples and exercises make it easy for managers and students to grasp the challenges involved in developing effective omni-channel strategies. This book can be used as a stand-alone in a distribution or channel strategy class or modules can be used in a variety of marketing classes." –Robert Dahlstrom, Joseph Siebert Professor, Miami University, USA and Professor of Marketing, BI Norwegian Business School, Norway