Question 1 (Debate)
Some marketers, feel that the image of a particular channel in which they sell product does not matter- all that matters is that the right customers shop there and the product is displayed in the right way. Others maintain that channel images- such as retail store- can be critical and must be consistent with the image of the product.
Take a position and justify:
Whether channel images do not really affect the brand images of the products they sell versus channel images must be consistent with the brand image
(A) Pro: Here the argument may be that buyers purchase products and services to satisfy their needs and wants. Consumers in their purchasing decision process, they may have the image of the product and services in mind based on the reputation of the company that produces product or offers services preferred by consumers. Thus to such consumers where to buy the product or services may be not important as long they have products or services that will provide them with satisfaction (Blyth,2005).
Marketers who favor product’s brand image over channel image may hold the argument that products with strong brand name and strongly advertised will always be sought after by customers who need them regardless where they are being displayed.
Distribution issues come into play heavily in deciding brand level strategy. In order to secure a more exclusive brand label, for example, it is usually necessary to sacrifice volume; it would do no good, for Mercedes-Benz to create a large number of low priced automobiles. Some firms can be very profitable going for quantity where economies of scale come into play and smaller margins on a large number of units add up e.g., McDonald’s survives on much smaller margins than upscale restaurants. Some firms choose to engage in a niche strategy where they forsake most customers to focus on a small segment where less competition exists e.g., opening a retail clothing store for very tall people. (Blyth, 2005).
Market balance: It is essential that different firms in the same business not attempt to compete on exactly the same variables. If they do, competition will invariably degenerate into price; there is nothing else that would differentiate the firms. Thus, for example, in the retail food market, there are low price supermarkets such as Boxer supermarket that provide few if any services, intermediate level markets like ShopRite, and high-end markets such as Woolworths food that charge high prices and claim to carry superior merchandise and offer exceptional service
Risk: In general, firms that attempt riskier ventures and their stockholders expect a higher rate of return. Risks can come in many forms, including immediate loss of profit due to lower sales and long term damage to the brand because of a poor product being released or because of distribution through a channel perceived to carry low quality merchandise (Du Plessis et al, 2005: 303)
Last minute items: some Companies such as coca-cola, and Uniliver benefits from extensive distribution such that its products may not need a customer to go through a purchasing decision process, but rather at a moment customer desires for products e.g. wanting to quenching ones thirst (Du Plessis et al, 2005: 303)
(B) Con: Owing to the fact that the consumer buying process, the consumer “value proposition,” changes based on individuals wants and needs at a time of purchase, for important products or services thus may demand different level of service, attention, and or “exclusivity” when buying. Such consumers their needs and wants may be met and influenced by different distribution channels of which a producer use. Kotler and Keller (2009: 459)
Objectives: A firm’s distribution objectives will ultimately be highly related some will enhance each other while others will compete. For example more exclusive and higher service distribution will generally entail less intensity and lesser reach. Cost has...
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