The Taiwanese tea industry got its start when tea trees imported from China got planted in the Taiwanese hills in the mid-1800s.

LEARNING OBJECTIVES Understand the central role played by end-users and their demands in the design of marketing channels. Define “service outputs” and identify and analyze them. Recognize how to divide a market into channel segments for the purposes of marketing channel design or modification. Understand how to target channel segments to optimize sales and profits. […]

Personal computers have become virtually commodity products. The technology is well enough established that buyers know they can purchase a computer with a given combination of characteristics (e.g., memory space, weight, speed, monitor quality) from multiple manufacturers. In such a market, two questions immediately emerge.

Learning objectives: –Define the generic channel functions that characterize costly and value-added channel activities. –Understand how the efficiency template helps codify channel function performance according to channel and channel participant. –Describe the role of channel function allocation in designing a zero-based channel. –Recognize how channel function performance leads to appropriate allocations of channel profits among […]

Sidebar 2-1 profiled the computer systems reseller CDW and its success in serving small and mediumsized business buyers through its superior provision of service outputs. Its ability to do so rests on its performance of key channel functions in a more efficient (lower cost) and effective (better at producing service outputs) manner than other channel […]

LEARNING OBJECTIVES: Understand vertical integration as a continuum from make to buy rather than as a binary choice. Explain why channel players (manufacturers, wholesalers, retailers) often integrate forward or backward with great expectations, only to divest themselves within a few years. Frame vertical integration decisions according to whether owning the channel, or some of its […]

Allianz, a much admired German Insurance Giant, paid what in retrospect was a high price to acquire Dresdner, a prominent investment bank.

LEARNING OBJECTIVES: Explain why manufacturers prefer more coverage, especially in fast-moving consumer goods industries, combined with a downstream channel member that limits its assortment in their product category. Explain why downstream channel members prefer less coverage, combined with a greater assortment in each manufacturer’s product category. Recognize why limited distribution is preferable to brands with […]