Integrated Marketing Integrated Marketing ChannelsChannels

Prepared By,Sagar Gadekar

Importance of Channel Importance of Channel IntegrationIntegrationBridge the Gap.Streamline the Physical and

Information.Reduces the Levels of Opportunism.Reduce the Uncertainty, cost and

Risk.Degree of Integration.Better Management.Better Co-ordination.Barrier of other Competitors.

Types of Channel Types of Channel Integration.Integration.Horizontal Marketing Systems.

(HMS)

Vertical Marketing Systems.(VMS)

Multi channel Distribution Systems/ Hybrid Marketing System.

Horizontal Marketing Systems.Horizontal Marketing Systems.(HMS)(HMS)Advantages of HMS Horizontal integration of related businesses allows

them to achieve economies of the scale by selling more of the same product through geographic expansion.

Horizontal marketing system includes the economies of the scope through synergies achieved by sharing of resources common to different products, and reduction in the cost of international trade by operating factories in foreign countries.

Disadvantages of VMS The integration of business may result in problems

related to size such as lack of coordination. Conflicts between members. Decrease in Flexibility.

Vertical Marketing Vertical Marketing Systems Systems Advantages of VMS It is easier to control channel behavior. It is easier to eliminate conflicts that results

when independent channel members pursue their own objectives.

It improves distribution efficiency by combining the efforts of individual channel members.

The economies of scale through the size, bargaining power and eliminating of duplicating services can be achieved.

Multi channel Distribution Systems/ Multi channel Distribution Systems/ Hybrid Marketing System.Hybrid Marketing System.

Advantages. Increase in Market Coverage. Lower Channel Cost. More Customized Selling. Disadvantages More channel conflicts. Problem in Controlling. Degree of Freedom. Non cooperation among the different

channel.

Consumers Goods Consumers Goods Channel Alternatives for

Consumer Goods. Producer – Consumer (0 level Channel). Producer –Retailer– Consumer (1 Level) Producer– Wholesaler– Retailer–

Consumer(2Level) Producer –Agent– Wholesaler—Retailer—

Consumer (3 Level) Producer—Wholesalers –Agent—Jobbers—

Retailers– Consumers (4 Level)

Industrial GoodsIndustrial GoodsProducer – User.Producer– Industrial –User.Producer –Industrial Distributor—

Reseller—User.Producer– Agent– User.Producer—Agent—Industrial

Distributors—User.

Channel Alternative for Channel Alternative for Services.Services.Producer– Consumer.Produces – Agent– Consumer.

Thank You.Thank You.