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Distribution in marketing is the fundamental task of ensuring that products that are produced reach the consumers. In marketing product distribution process may be carried out through the distribution channels. Distribution channels can, therefore, be described as the facilitating agencies that ensure goods and services reach their intended end users. These processes enable the producers sell their products to the end consumers, while at the same time enable consumers attain the products from producers. Effective and efficient sales of products, therefore, heavily rely on distribution channels. Distribution channels can enable producers maximize their competitive advantage. Based on the importance of these channels that enable producers deliver their products to their intended consumers, managing distribution channels is, therefore, a vital marketing strategy. It enables firms remain ahead of their competition by ensuring that there is an effective and efficient link between consumers and producers. Product distribution can determine the success of a product in the market.
Customer Relationship Management (CRM), on the other hand, is a business concept that enables firms to manage their interactions with their consumers. Customer Relationship Management can enable an organization identify relationships issues that may arise in its interactions with customers. CRM, therefore, is an essential component of business management which enables firms to identify their customers’ and areas where their relationships need improvement. The two concepts can, therefore, be integrated to enable firms meet their consumers, needs and to these needs efficiently. Employing the two concepts can enable an organization to increase its customer value, as well as their own value. CRM helps businesses to understand their relationships with their customers, this in turn, enables such organizations to maintain their competitive edge and maximize the available opportunities. In addition, business organizations are able to anticipate and fulfill the market needs. This is through acquiring the capability of identifying potential requirements, hence becoming able to anticipate their consumers’ needs.
To the producers, how well their products reach their intended targets, is one of their vital strategies. In order to reach the intended markets, the distribution channels must have the capability to deliver the products to consumers. This should be the most cost effective and efficient way (Amato & Amato, 2009). This makes designing distribution channels, a crucial and critical task to producers. Firms, consider structuring their products distributions systems, as one of the main marketing strategy decision. The structure of the distribution system is capable of providing business organizations with unique benefits in terms of costs and market expansion (Keating, 2010). There are different distribution options available to firms to enable them to move their products to their users, with each having unique advantages and shortfalls.
A firm can choose to deliver its products to the consumers directly, through intermediaries or a combination of process. Structuring the distribution channels depends on a number of factors. Product attributes is one of the main factors that can determine the distribution channel used. Perishable products are items that have a short lifespan ranging from a day on wards to months. For this reason, they require to reach their end users before getting spoiled or expiring (Keating, 2010). Distributing such items is, therefore, a direct process from the producers to the consumers. Similarly, bulky and fragile items demand careful and often delicate handling when moving such products from the producers to consumer. Direct distribution channels may be, therefore, preferred to reduce the risks when moving these products (Shang, Yildirim, Tadikamalla, Mittal, & Brown, 2009). Highly customized products, on the other hand, are products that require standardization according to the consumer requirements. To distribute such items, the direct distribution channels are most preferred, in order to modify the items to consumers’ specification. Highly technical products require technical support that is easily available from the producers. As such, they require direct distribution channels or selective distributions where producers identify distribution intermediaries with the required expertise.
Secondly, product prices also determine the distribution channel required to move the product to the end users. Products with low prices are often the items that deemed or perceived convenient by their users (Campbell & Frei, 2009). This means that they have intensive distribution requirements hence; they should be distributed through indirect distribution channels. Highly priced products usually are specialty products and their distribution can, therefore, be direct or through selected intermediaries. The ability to identify the best channel of distribution can determine the performance of any business organization. Channels of distribution should be designed in such a way that a business increases its own value and efficiently meets all the consumer’s needs (Campbell & Frei, 2009).
Cyber Crime Awareness Program
Cyber Crime Awareness Programs are designed to help organization secure and protect their information in the current business environment where most functions within business organizations are IT enabled. Information technology today, links business organizations with all the internal departments and their external partners. Business are therefore, linked to their suppliers, distributors, retailers, agents/dealers or any other partners. Access quality information which draws a complete clear picture of the organization needs should be complete, updated, accurate and easily accessible. A Cyber Crime Awareness Program is meant to ensure that all IT based information links are secure and protected. This enables organizations to transmit vital information through secure networks. Designing such a program should be aimed at ensuring that information networks are not accessed by unauthorized personnel. In addition those authorized to access the networks should not carry out unauthorized changes.
The main objective of Cyber Crime Awareness Program is to train employees on information security to ensure that information is transmitted securely. The program should also help an organizations learn their roles in protecting their organization information networks from unauthorized access or modifications. Such a program should also enable an organization outline to it employees the steps that should be undertake to secure and protect their information. This is through proper utilization of information technology and understanding their stake in ensuring that information is protected.
To design a Cyber Crime Awareness Program that would enable organizations secure and protect their information
Most organizations today utilize information technology to link their organizations internally through internal departmental links. In addition organizations are linked with their external partners to ensure the availability of timely and complete information. This therefore implies that most organizations today require secure and protected information networks that would ensure that information transmitted internally and externally is properly protected and secure. The Cyber Crime Awareness Program is aimed at securing information for producers who utilize distribution channels to ensure that their products reach their markets.
Channels of Distribution
The marketing process can be segmented, targeting or market positioning depending on the intent of the business firm. Marketing decisions heavily rely on distribution channels, products, promotion and prices. While strategies employed in marketing decisions are dependent on the path chosen by a firm and can range from the market segmentation, positioning to market targeting (Shang, Yildirim, Tadikamalla, Mittal, & Brown, 2009). Distribution channels, which are collective agencies that support a firm's marketing function, can be units or institutions that producers engage to deliver products to the end users. These distribution channels can be external or within the manufacturing organization depending on the producers preferred system or channels that efficiently deliver products to their consumers.
Marketing functions range from selling products, product transportation, storage, buying, financing, promoting products, grading to risk taking. Distribution channels can take one or more of these functions. The structure of the distribution system determines the number of functions that the channel is to undertake and mainly dictates its structure. Within the distribution channel there are those who can be assigned the transportation function alone, others can undertake product storage, while others can undertake multiple functions such as selling products in wholesale or retailing the product (Draganska, Klapper, & Villas-Boas, 2010). As such, the distribution channels have the ability to determine the speed in which the product reaches the consumers and the eventual end cost of the products. In addition, the way a distribution function is designed can determine the amount of influence that the manufactures have over their products after the completion of the production process.
Generally, the manufactures sell their products to distributors to sell to the consumers, have little control over the channel, once their products leave their companies. While those who sell directly to consumers and uses intermediaries to deliver their products, have more control over their distribution channels (Sanchez & Ramirez, 2006). This influence, however, can turn into higher operation cost and more risks for the manufacturers. Where the structure is designed to be indirect the most of the risks may be absorbed within the distribution channel. This implies that some of the costs and risks have been absorbed by wholesalers, carriers, warehouses, retailers. Although, the manufactures have less control over their products in terms of cost and time they have less risks in such as distribution structure (Keating, 2010). Vertically aligned firms often have loosely structured distributional channels.
Distribution channels mainly determine the targeted consumers and the products nature. Products that target segmented markets may require multiple distribution channels. Before products can reach consumers, there are many functions that need to be performed. These functions include inventory management, product modification or product may also need customization to fit the consumer requirements. In addition, products require promotion, product transportation, product maintenance, product packaging and product services after sale (Rabinovich, Knemeyer, & Mayer, 2007). These functions can fall under either the manufacture or within the functions that the intermediary agencies in the distribution channels should perform. This all depends on the structure of the distribution channels.
There are mainly four types of distribution channels. These include distribution channels that move products from the producers directly to their consumers. The second type of distribution channel is where goods move from the producers to dealers and then to the consumer. The other distribution channel moves the products first are passed on to the wholesaler by the producer then to the retailers before reaching the consumers. Finally, products can be distributed from producers to the dealers or agents then to the wholesaler who distributes to retailers. before finally reaching the targeted consumers.
Designing Distribution Channels
When designing a distribution channel, the considerations include identifying the consumers. In a distribution channel targeting homogeneous consumers, the consumers have similar requirements. The distribution channels should, therefore, have similar features while diversified consumer needs may require distribution channels that have varied features. Product information is critical to the design of distribution channels. Consumers need specified information relating to the products that they require. The product can have complex, technical aspects or may be new to the market, meaning that the consumer may require a lot of information on the product. Products also can have dynamic technological components, which mean that the components keep changing with time (Amato & Amato, 2009).
Certain product may require to be customized to meet the consumer requirements. Such products require distribution channels that have experts who can perform the required modifications. Consumers also require products that have high quality standards especially, if the products in question are components that may be required to process other products (Rabinovich, Knemeyer, & Mayer, 2007). The distribution channel can also be determined by the size of the product required by the consumers. There are products that have extensive uses to their consumers and are normally lowly priced. This implies that the consumers require such products in large volumes, and the profit margin for these products is low. For such products, the distribution channels should be designed to handle large product volumes. Since the low profits accrue, producers should use multiple distribution channels to lower operation costs. This is because dealers or the intermediary firms that producers engage to move their products to the consumers, often have greater knowledge of the market.
This knowledge of the market needs may help the intermediary firms to have more flexibility when responding to the consumer requirements. They have the ability to easily slash their costs more efficiently than producers. However, when producers have to use intermediary firms they lose control over their products (Campbell & Frei, 2009). Other factors that can determine the design of the distribution channel include the items produced require other complementary products to be available. In such a case, a manufacture should ensure that the distribution channels employed can easily avail the complementary products.
In addition, there are other products that require installation, maintenance, repair or warranty among other services after consumers purchase the products. This means that experts may be required to perform these functions. The distribution channel used should provide the required expertise to ensure the consumer satisfaction. The producers should, therefore, move such products directly to their consumers or identify dealers or agents with the required expertise. In order to be able to perform the required tasks, the consumer may need to enjoy the product. Distribution channels have logistical requirements such as transportation and product should also be a factor in determining the distribution design. Distribution channels should be structured depending on the intensity of the product requirements. Those awfully bulky products or highly technical products should be distributed directly to their consumers.
Customer Relationship Management
In business organizations, today Customer Relationship Management (CRM) is an essential component of business management. Customers in business organizations have different needs and to efficiently meet their needs, CRM helps identify areas where improvements may be needed. CRM also enables firms’ increases customer value, as well as their own value (Boulding, Staelin, Ehert, & Johnston, 2005). Understanding these relationships can help an organization maintain its competitive edge and maximize the available opportunities. This is through understanding the best ways to fulfill the market needs by identifying the potential requirements, hence the ability to anticipate the market. The main objective of applying CRM strategies is to create a value, both for the business firm and their consumers. To achieve the value creation, business needs to understand what its consumers need and the best way to fulfill their expectations (Reinartz, Krafft, & Hoyer, 2004). In the process, value accrues for both consumers and the business firms by employing this strategy.
CRM also enables business to build effective and efficient process by removing blockages in the system. It is, therefore, a strategy that can be applied in the distribution channels process. This should help to improve and increase their efficiency and effectiveness. CRM helps businesses track and manage their interactions with its product and users. In the process, firms can acquire the capability to maximize profitability or increase their revenues, through leveraging all the available potential to expand the firms’ activities. Some of the CRM strategies may require systems, others do not need systems. As such, implementing CRM strategies can, therefore, be determined by their requirements. Products have to land on the hands of customers at the end. To achieve this, business uses distribution channels and thus, distribution channels are the essential part of the relationship, between a business and its customers.
Customer Relationship Management in Distribution Channels
Distribution channels as earlier discussed help producers to get their products to their consumers. This can be done directly or through indirect approach. When integrating a CRM in a distribution channel where, the product may be moved from the producer directly to the consumer (Payne & Frow, 2004). The consumer information emanating from the CRM can be said to be in the hands of the producers. However, where the products have to move through indirect channels, there is the requirement to share the information. Dealers or the intermediary firms that producers use to move their products to the consumers, often have the greater knowledge of the market (Sanchez & Ramirez, 2006). They also have more flexibility when responding to the consumer requirements than producers and have the capability to incur fewer costs than the producers.
Sanchez & Ramirez, 2006 argue that producers are often more reluctant to share consumers information with their dealers or intermediaries. While dealers and other intermediaries can have different motives and goals than the producers they distribute products for. In such a scenario, the benefits that should accrue from an effective CRM can be watered down. CRM is capable of providing vital consumer information that if shared by the entire distribution channel should add value to their consumers, as well as those within the distribution channel. There may be instances where the dealers’ motives and goals differ from those of the other players in distribution channels. Such cases or scenarios can result in acts of sabotage where the producers’ effort may be undermined. This normally leads to the reluctance to share information with the other players in fear that it may be used to compete against them (Samaha, Palmatier, & Dant, 2011). Yet, if their revenues and profits depend on selling products that they acquire from the manufactures, it would make more sense to share the information. In other words, business should be sharing information when dealing the relationship is mutually beneficial for all parties. In addition, they have goals and objectives that depend on the same product and the success of successful marketing it to the consumers (Boulding, Staelin, Ehert, & Johnston, 2005).
This means that when the products satisfy the needs of the consumers, their values, similar benefits and satisfaction should accrue to those within the distribution channel. For CRM to benefit everyone within the distribution channel, this should be the underlying assumption. In this case, sharing information gathered through the CRM system becomes beneficial for every party involved (Chen & Popovich, 2003). Put more appropriately, the CRM should benefit the consumers, producers and the intermediaries within the distribution system. Such benefits would help the consumers add value from using the products, since they meet all their required needs. At the same producers and the intermediaries within the distribution system would increase their profits by lowering costs and expanding their market (Payne & Frow, 2004). Profits maximization usually is the prime motive of any given firm engaging in business activities. Thus, everyone fulfills their needs.
Distribution channels help in the facilitation of delivering products and services from the producers to the end users. The distribution channels provide the vehicle via which the producers sell their products to the end consumers, while at the same time enable consumers attain the products from producers. Effective and efficient sale of products, therefore, heavily relies on distribution channels. Distribution channels can, therefore, enable producers maximize their competitive advantage and help add value to both the producers and consumers. The distribution channels have the ability to determine the speed in which the product reaches the consumers. In addition, the way a distribution function is designed can determine the amount of influence that the manufactures have over their products. Customers in business organizations have different needs and to, effectively meet their needs business employ CRM strategies.
Customer relationships management systems have the capability to identify weak areas within the channel distribution systems where improvement is needed. By helping strengthen the weaker areas, the CRMs enables business organizations increase customer value, as well as their own values. This is through managing and understanding customers’ relationships, which can help an organization maintain its competitive edge and maximize the available opportunities. In addition, CRM systems have the capability of providing business organizations with a lot of vital customer information. The availed information can enable businesses to use the best ways to fulfill their consumers’ requirements and at the same time identify the existing of market needs. In helping identifying the potential requirements, the CRM ensures that business firms have the ability to anticipate the market needs. This provides businesses with the opportunity to expand their activities. The main objective of applying the CRM strategies can be said to enabling firms add value both for firms and their consumers, as well as maximizing profitability. These goals are well aligned with those of business organizations. Incorporating the CRM system in distribution channels can, therefore, increase the benefits that producers and other players can make. Finally, the CRM is a goldmine for consumer information, utilizing the available information can enable business identify its strengths and weaknesses.