Understanding Marketing Channels

Channel Management Challenges in Professional Services Organizations

Write a Reflective Essay on Marketing Channels.

The study on marketing channels course has given me a broad understanding of the management of marketing channels. I have learned that marketing channels are the activities, people, and organizations necessary for the transfer of goods ownership from production point to consumption point. As a channel for distribution, marketing channels entail the way end-users get products and services (Jayaraman & Luo 2007 pp.56-73). These channels entail the way goods and services are availed to the customer for use. The efficiency of an organization’s marketing strategies will depend substantially on how goods and services go through the channels of distribution. The route through which a commodity follows from the point of production to the final consumer is imperative since a marketer is obliged to determine which channel or route is most suitable.  Dual distribution is a form of a marketing channel that I have realized is less known. Dual distribution enables wholesalers to get to the consumer through the use of different distribution channels (Boulding et al. 2005 pp.155-166). The essay aims to reflect on what I learned from the lectures on marketing channels course on Channel Management Challenges in Professional Services Organizations, Pharmaceutical Marketing Channel Management, and Marketing Revolution.

Based on instructor John Clay’s lecture on marketing channels in the professional service industry, I have learned that the service industry has very unique marketing channels. The use of channel distribution combinations in the service industry helps the companies manage their services demand (Van et al. 2010 pp.331-340). I have realized that the service industry has a different client engagement criterion with the income equaling billable hours multiplied by the charge out rates through the seller-doer criteria. The service industry greatly invests in winning business and clients and therefore combines several service lines into a single line in order to achieve results that are better (Ansari et al. 2008 pp.60-76). I have learned that multiple parties including accountants, engineers, marketers, architects, and legal services come together so as to execute large projects and must all work hand in hand in order to make the project work.

I now know that the service industry can choose numerous channels so as to reach different strategies for pricing that are aligned with the income of the members of the market segment. The strategy enables service industries to get access to new markets as well as bridging demand reductions that are temporal using a low counting channel that is integrative and one that cannot be isolated (Cattani et al. 2006 p.40). The professional services channel can be direct where people need personalized consultation, or indirect, where people are satisfied with buying off the plan (Knox & Freeman 2006 pp.695-716). I have noted that there exist Omni channels which may be part of consortiums, through intermediaries or direct to the client. I learned that short channels have complex solutions in online service delivery through customer interaction on channels that are different. I had trouble understanding how the channel for direct sales allows the service industry to contact their customers while not using mail orders, online or through visits but realized that the service industry has full control on their pricing and offers presentation.

Pharmaceutical Marketing Channel Management

Lecturer Joyce Li gave me a deep insight into the management of marketing channels for the pharmaceutical sector that is important in the fight to win patients and customers. I understood that personalized medicine, real-life data, and value-based pricing, were all vital marketing strategies that are being put to use in pharmaceutical marketing. I learned that depending on how access to the market is for pharma marketers, focusing on the fast moving consumer goods is not yet a focus. The manner that consumers accessed products, the retailer and distributor relationship, the promotions and services deployed, and how these aspects affected profit and loss, was main considerations in the management of pharmaceutical marketing channels (Applbaum 2006 p.189). In Australia, prescription medicine is only communicated and promoted to doctors and pharmacists but not to the patients who are the consumers of the medicine. The channel used includes discovery, development of product, manufacturing, distribution and sales marketing that may take decades until a product is launched (Usman et al. 2009 pp.363-380).

Pharmaceutical marketing channels include direct marketing which is done through the internet, email, and telephone, for example, inside the hospitals (Bruni & Verona 2009 p.20). I learned that multiple channels could also be used as well, which include customer service, field force, and medical support in pharmacies and hospitals, or through general practitioners. The Intermediary marketing channel is carried out through agents or merchants, distributors, wholesalers, franchise, the government and business partners (Danielis et al. 2010 pp.54-69). I realized that the pharmaceutical marketing channel has numerous channel members that include nursing homes, retail pharmacies, public hospitals, distributors, insurance companies, the government, and patients who are the end users. Products that are sold over-the-counter are marketed directly to the end-users. However, I was quick to note the challenges in the marketing channels for pharmaceutical products. Levels of company innovation and agility affect how the marketing channels operate. Choosing the right channel depends on what the company’s goals is, and how it would like to interact with the end-users of its products.

The lecture by Instructor Mark Cario about market revolution enabled me to learn that no franchise company can be successful without successful franchisees. I realized that growing a franchise is a hard and exhausting undertaking since one has to bring into consideration marketing and corporate sales, and how the franchisees’ requirements will be met. Additional programs for marketing, corporate programs for marketing and programs for corporate marketing are some of the aspects brought into consideration when dealing with the growth of a franchise (Watson et al. 2015 pp.546-568). I learned that these initiatives are independent and corporates can’t do with just one since they need to be working together in order to achieve success. People join a franchise in order to get marketing support, system support, operation support, training support and to minimize the risk of failure hence increasing success chances (Leeflang et al. 2014 pp.1-12).

Marketing Revolution

I realized that marketing for franchisees is important because if the franchisees fail, the business will also fail which will result in hardships when attracting more franchisees if the current franchisees are not gaining any profit. Programs for corporate marketing improve business-to-business perspective by attracting more franchisees. I learned that success in acquiring more franchisees can be achieved through having a strategy that is location-based whereby most of the franchisees have a location element of some sort. The main aspects pulling people to a franchise is business demand due to the credibility of the brand in the eyes of the consumers. I noted that the reason was that the franchise is strongly set up in that customers will automatically be drawn when you buy it, which is the reason why franchises deliver business, and clients may just bring a business towards the owners. Either way, companies are encouraged to work to ensure there’s an established pipeline for the business owners, a move that keeps business more achievable and makes the business greatly attractive. However, I realized that franchise marketing was different from regular marketing through accountability and having more stakeholders.

Conclusion

The study of marketing channels equipped me with all the tools I needed to be in a position to access the kind of marketing channels that are involved in the service industry, the pharmaceutical sector, the challenges involved when dealing with marketing channels, and marketing revolution. I noted that these distribution channels or ‘routes-to-market’ encompass a vital aspect of the success of any business. A company, for instance, which implements effects product paths or pipelines initiates rapport and enhances its relationship with its consumers. Needless to speak, customer gratification and satisfaction is the first step towards the success of any business entity operating in the contemporary competitive business world. Corporates should focus on exploring vast strategies across the discussed marketing channels in order to ensure that they choose the best strategy which best suits their requirements. When deducing what is deemed as a suitable marketing channel, it is prudent to consider both positives and drawbacks associated with that particular path. This is vital because what seems appropriate now might not be useful in the long run.  Learning more about the performance metrics in market revolution can go a long way in assisting an organization to choose the best marketing channel for their business.

References

 Ansari, A., Mela, C.F. and Neslin, S.A., 2008. Customer channel migration. Journal of marketing research, 45(1), pp.60-76.

Applbaum, K., 2006. Pharmaceutical marketing and the invention of the medical consumer. PLoS Medicine, 3(4), p.189.

Boulding, W., Staelin, R., Ehret, M. and Johnston, W.J., 2005. A customer relationship management roadmap: What is known, potential pitfalls, and where to go. Journal of marketing, 69(4), pp.155-166.

Bruni, D.S. and Verona, G., 2009. Dynamic marketing capabilities in Science?based firms: An exploratory investigation of the pharmaceutical industry. British Journal of management, 20(s1).

Cattani, K., Gilland, W., Heese, H.S. and Swaminathan, J., 2006. Boiling frogs: Pricing strategies for a manufacturer adding a direct channel that competes with the traditional channel. Production and Operations Management, 15(1), p.40.

Danielis, R., Rotaris, L. and Marcucci, E., 2010. Urban freight policies and distribution channels: a discussion based on evidence from Italian cities, pp.54-69.

Jayaraman, V. and Luo, Y., 2007. Creating competitive advantages through new value creation: a reverse logistics perspective. The Academy of Management Perspectives, 21(2), pp.56-73.

Knox, S. and Freeman, C., 2006. Measuring and managing employer brand image in the service industry. Journal of Marketing Management, 22(7-8), pp.695-716.

Leeflang, P.S., Verhoef, P.C., Dahlström, P. and Freundt, T., 2014. Challenges and solutions for marketing in a digital era. European management journal, 32(1), pp.1-12.

Usman Awan, M., Raouf, A., Ahmad, N. and Sparks, L., 2009. Total quality management in developing countries: A case of pharmaceutical wholesale distribution in Pakistan. International Journal of Pharmaceutical and Healthcare Marketing, 3(4), pp.363-380.

Van Bruggen, G.H., Antia, K.D., Jap, S.D., Reinartz, W.J. and Pallas, F., 2010. Managing marketing channel multiplicity. Journal of Service Research, 13(3), pp.331-340.

Watson IV, G.F., Worm, S., Palmatier, R.W. and Ganesan, S., 2015. The evolution of marketing channels: Trends and research directions. Journal of Retailing, 91(4), pp.546-568.