first in marketing audits
Marketing Channels

Many producers do not sell directly to the final user. They use intermediaries who make up a variety of marketing channels, called broker, facilitator, manufacturer’s representative, merchant, retailer, sales agent, sales force and wholesaler or distributor.

Marketing channel decisions are among the most critical decisions in the mix. Effective and healthy channel management calls for selecting intermediaries and motivating them. Channel conflict and competition are common symptoms of goal incompatibility, poorly defined roles and rights, perceptual differences and interdependent relationships.


Some of the intermediaries are so large and powerful that they dominate the manufacturers who deal with them. As a result, they require their own marketing strategies, especially the retail organizations.

Retailers today are eager to find new marketing strategies to attract and hold customers. In the past, retailers obtained customers through convenient locations, a special or unique assortment of goods, greater or better services than competitors and store credit cards. All of this has changed and is no longer a powerful differentiator. Today, many stores offer similar assortments and stores are looking more and more alike. This is primarily due to the national brand manufacturers’ drive for volume by placing their branded goods everywhere.

Service differentiation also has eroded. Customers have become smarter, more price-sensitive shoppers. Why should they pay more for identical brands, especially when service differences are diminishing? Nor do customers need to get credit from a store, with bank credit cards being universally accepted.

For all these reasons, many retailers are rethinking their marketing strategy. The retailers’ most important decision is to identify their target market and whether they should target that market with variety, assortment, depth or convenience. Until that target market is defined and profiled the retailer cannot make consistent decisions on product assortment, store decor, advertising messages, media, price levels and so on. Too many retailers have not classified their target market. In trying to satisfy too many markets, they are satisfying none of them well.