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F&M Distributors takes the role of retailer in selling its private-label products and large volumes of P&G products. The firm’s business is large and extensive since it operates more than 100 drug stores, in addition to marketing P&G products. From several arguments, the fact that retailers control the private label positioning is one of the main reasons that make store brands so valuable. F&M came up with a strategy of designing and packing products that resemble those of P&G Company. In this case, F&M introduces private labels that are close substitutes for P&G and thus, the company obtains better terms of payment from P&G Company. P&G seems to have a strong market power since it is a competitive manufacturer, but F&M is posing a serious competition in its process of marketing P&G products. P&G is taking over the limited shelf space in introducing private label products.
The role of independent distributor is to ensure production of a wide range of components that meet the consumers’ demands. Independent distributors also pose a healthy competition in the marketing industry. F&M are independent distributors, but it has gone further to design P&G products to look identical to products like Secret, Sure, Head, Shoulders, and Pantene.
P&G Company’s move of suing its channel member, F&M, is wise since such copycat private labels are aimed at replacing P&G Company’s famous products. This strategy is designed to imitate famous P&G products that sell better.
Companies tend to channelize the services form hybrid Distribution Channels and products in several ways, in order to reach as many customers as possible, in an effort to create value for channel partner and the company. Hybrid distributions models are featured by the existence of several distribution channels modes, which belong to the same legal entity, are formed to distribute products to a couple of market segments. This distribution strategy has changed with the internet advancement. Internet offers a new channel which allows to reach the customer anywhere worldwide. In this case, The Land Rover, which is now a segment of Ford Motor Company, employed internet in marketing its new car and launched Freelander model in the US market.
Benefits of Hybrid Channel
This new channel of marketing offers the customer detailed information about the product. It recognizes that users are not brand loyalties but have their own choice of activity they would like to experience. The channel expands the market coverage for the dealer and control costs since the channel is remarkably efficient. It also promotes the new SUV Freelander.
Advantages of Using Online Marketing Strategy
It provides the potential buyer a suggested retail price of the manufacturer on the certain model as shaped or set up by the consumer. Based on the configured price, the consumer gets the chance to negotiate for lower prices from the dealer. Potential buyers are able to shape up or set the car the way they want in terms of accessories, equipment and colors and see the full Freelander on the screen.
Challenges of Making Sales Contests and Incentives
Sales people have a feeling that their efforts are appreciated, this fosters positive relationship between them and the manager. A bored sales person may begin looking for other jobs or may feel he or she is no successful in the current occupation. Their attention can be attracted by making them work with little efforts for the next commission. The commission should not be permanently put beyond their reach. The industry can put up, if possible a PowerPoint presentation or a PDF, which explains compensation in detailed format. The industry can schedule appointments to call them together, as well as use a projector to show them how they get their bonuses.
Using a Poster, CD or DVD in Marketing
A poster, a DVD or a CD can be used as a way to interest customers by giving them visuals that can grab their attention. The visual being created must work together to provide a professional and unified package. Full color printed posters are attractive and give the people they see to look at it in a different light. Creating a positive impression about a company is crucial. The company can lose its best employees if the competitor has a better commission structure. Trying something like sales contests along with monetary rewards either for an individual or teams can be a beneficial idea (Rosenbloom, 2009).
Logistical Rationale for the Two-Step Flow of Merchandise
OfficeMax is a company dealing with staples and office depot. The company has 950 stores and annual sales of less than 5 million dollar. The company is the number three in supply of office stationery and depot. The company should reduce these inefficiencies by building three large distribution centers to improve the shipping of its products. This will result in 95 percent smooth flow of merchandise through the larger distribution centers and finally into the stores. Beginning from the distant manufacturers, OfficeMax merchandise would be loaded to vendor ships. The Vendor ships would directly supply the products to distribution centers. Distribution centers would then redistribute goods to the stores. The move does not seem counter-intuitive than an extra step, as it will help in reduce the costs including processing and high shipping costs, order size levels that are not efficient and decrease stocks. Efficiency will eventually be realized if the company establishes the three distribution centers.
Tina Anderson, who is a customer, got a chance to meet professional salespeople at a Camera Store. She makes enquiries about the advantages and disadvantages of various kinds of cameras. Tina is also a knowledgeable and learned customer who can access the internet channel and shop the Camera online. The Camera must have been a genuine product from a registered firm dealing with the same products. Tina acts as if she did not care whether the online is a registered dealer authorized to sell Minolta cameras or not.
Online is an example of Hybrid Channel of marketing. The Camera Store has adopted the modern technology to market its products. The Store seems to enjoy a sound marketing technique supported by a well organized and experienced sales team. The Store offers after sales services to its customers as it delivers the Camera by UPS to Tina in five days time. Tina got the best services to the point that the automatic camera, which is a Minolta model, was delivered to her successfully (Rosenbloom, 2009).
Midas Inc Policy
Midas Inc Company in the United States is well known for dealing with automobile muffler repair business. The company provides its services and products to several franchised dealers throughout the US. The Company came up with a policy that will require dealers to take back the replaced mufflers for verification whether they are worn out or defective. The company has been relying on a traditional system where the dealer’s word only was enough to acquire credit from the company for replacement of mufflers under the warranty. This traditional system seemed to be straining the company resources since consumers, who had their mufflers replaced at the company, were also entitled to a replacement free of charge if the muffler wears out or if anything goes wrong as long the customer owns a car. This strain of resources might have led the company to come up with the new policy.
Impact of Midas Inc policy
The new policy by Midas Company requires dealers to bring the replaced mufflers for verification, if they are indeed effective or worn out; this will affects dealers’ behavior. Dealers are not welcoming the new policy and have joined hands to oppose it. They think that the policy will limit their flexibility in dealing with consumers hence undermining goodwill.