BERMAN13.PPT 35KB Jun 05 2011 09:30:17 PM

MARKETING CHANNELS
Channel Power
Berman chapter 13
Version 3.0
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Channel Power
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1. Behavioral - conflict, cooperation
2. Channel Power
3. Channel Dominance
4. Nature of Conflicts
5. Channel Cooperation
6. Conflict Management and Resolution

7. Channel Satisfaction
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CHANNEL CLOUT
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Innovative
Assortment
Brand- identity
Profit making
Bundling

• Serviceresponsiveness
• Training
• Geographic
• Quality

• Market- development

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1.Behavioral Systems
• Approach vs Economic Systems
• Perspectives
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power
conflict
cooperation
satisfaction

• Bases
– social psychology
– organizational theory

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2. Channel Power
– def - control and influence of marketing
strategy of another member

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dependency vs independency
range of power
potential power
exercised power
– reward, referent, expertise, persuasion,
legitimate, information
– coercive vs non-coercive
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Coercive power
• ability to punish
• opposite of reward
• threat approach
• conflict

Non-coercive power
• reward - performance
• referent - identity,
image
• expertise - market
knowledge
• persuasion - validity
• legitimate agreements
• information - data
access
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3. Channel Dominance
Manufacturer

• economic scale, size
• market share
• brand loyalty
• franchising
• refusal to deal
• termination
• vertical integration
• push money

Wholesaler
• economic scale
• private label strategy
• gray market strategy
• customer loyalty
• tying agreements
• forward, backward
integration
• quantity discounts
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Buyer Retailer Power
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store loyalty
bargaining share
centralized purchasing
private label strategy
selling against the brand
exclusive merchandise
gray market distributors
slotting, pay-for-performance, failure fees
retail trade associations

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• Control of the Channel
– channel captain
– individual determination

• Power and Performance
– higher performance
– self preservation
• complementary roles

– self enrichment
• mutual economic gain
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4. Nature of Conflicts
• types
– horizontal, intertype, vertical

• stages

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latent - sources
perceived vs latent
felt - tension, anxiety, disaffection
manifest - blocking goal achievement
aftermath - post conflict behavior
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• Dimensions
– intensity - minor, occasional, major
– frequency - infrequent, occasional, continuous
– importance - high, medium, low

• Causes
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role incongruity
perceptional difference
decision domain disagreements
expectational differences
goal incompatibility
communication difficulty
resource scarcity

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• Channel dysfunctional results
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stimulates innovation
reduces complacency
increased efficiency
zone of tolerance

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5. Channel Cooperation
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joint promotional programs
joint inventory management assistance

exclusive products
information sharing
training
territory protection
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6. Conflict Management and Resolution
general methods
• persuasion
• problem solving
• negotiation
• politics

specific methods
• sensitivity training
• shared tasks
• joint goal setting
• channel wide
committees
• conciliation
• distributor advisory
councils
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7. Channel Satisfaction
elements
• social interaction
• product assistance
• financial assistance
• cooperative
advertising

results
• higher morale
• greater cooperation
• fewer terminations
• fewer lawsuits
• reduced protective
legislation efforts
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