Marketing Channels

Marketing Channel Types

Different marketing channel types make it easier for companies to reach more customers in less time. Organisations must communicate marketing messages and deliver products. Marketing channels fulfil all these functions.

Vertical Channels

In a vertical marketing channel, the producers, wholesalers, and retailers act as a single unit to bring the products to the target customers, in contrast to the conventional distribution channels. No channel member has much control over the other members as no formal roles are established. As a result, it can be difficult to resolve conflict. There are three vertical distribution channels - corporate, contractual, and administered.

• Corporate Vertical Channel - common ownership and integration of different levels of production and distribution stages.

• Contractual Vertical Channel - firms operating at different levels of production and distribution function together under a contractual agreement.

• Administered Vertical Channels - different stages of production and distribution collaborate due to the size and dominance of one of the parties.

Horizontal Channels

Two or more organisations working at the same level join to function as one. Different companies may have the upper hand in different marketing, financial, or production facets, making this union beneficial for all the involved parties. This union may be between competitors or non-competitors. Such companies benefit from synergies, and this channel also works well globally.

Multi-channels

Multi-channels involve creating multiple marketing channels to reach one or more customer segments and increase sales. This benefits companies by reaching customers through many channels - expanding customer reach. Multi-channel marketing may be a fast method for increasing sales, as more customers are aware of the products through the different channels.

Functions of Marketing Channels

The various functions of marketing channels prove to be advantageous for companies. However, giving away the distribution function also means letting go of a certain level of control.

Marketing channels make products available to the target group quickly and efficiently (compared to if they were distributed directly by the manufacturer). This is because these channels have the resources, contacts, experience, and scale that help them function efficiently. They help not only producers but also customers.

Marketing channels reduce the chaos and hassles of distributing and purchasing a product. Multiple manufacturers can work with one distributor to distribute the products from all the manufacturers to all the customers.

As outlined in the example, the various channels buy supplies from multiple manufacturers in large quantities, which allows them to present customers with a wide variety of products in smaller quantities. This makes it easier for customers to choose and make a purchase.

Not only do marketing channels distribute products to customers, but they also perform other significant functions. Spreading awareness about products and promoting them to target customers are vital functions of marketing channels.

The different channels understand their customers' needs and see the product gaps clearly as they work directly with customers. This also helps them identify the appropriate market for the right product.

Risk-taking, financing and negotiating are a few additional functions of marketing channels.

Cross Channel Marketing and Cross Marketing

Cross-marketing and cross-channel marketing are two essential concepts of marketing. Let us take a look at them both in detail.

Cross Marketing

When two or more businesses work together to promote their products and increase sales, it is called cross marketing. As a result of cross-marketing, brands can provide something new to their customers.

Although cross-marketing aims to increase sales and fulfil business goals, it can only be possible if the target market, their wants and needs, social status, income, and other demographics are similar for all the involved parties. The following are the steps followed by companies that plan to market their products using cross-marketing channels:

• Setting objectives,

• Analysing the target audience,

• Looking for potential partners,

• Creating a partnership agreement

Cross-channel Marketing

As you may have guessed, a cross-channel marketing strategy uses different channels to reach its customers.

Companies mainly provide two or more channel options to reach their customers, ensuring more customers can interact with the brand. Providing more channels also allows customers to connect with their preferred or trusted channels. Different communication channels include e-mail, SMS, social media, brand websites, phone, etc.

Marketing Channels Examples

Marketing channels perform many tasks, promotion and distribution being the main ones. Some marketing channel examples are outlined below.

Promotion Channels

Marketing channels used to promote a product:

• Social Media Marketing

• E-mails

• Influencer Marketing

• Content Marketing

• Online Advertising

• Offline Advertising

• Search Engine Optimisation (SEO)

• Word of Mouth Marketing

• Partnership Marketing

These are different channels that raise awareness of a product among the target group. Marketers can use each channel to reach different audiences.

Distribution Channels

Distribution channels are used to get the products or services from the producer to the customer. The different channels that may be used are as follows:

• Wholesaler

• Retailer

• Dealer

• Agents

• Internet

• Sales Team

• Value-Added Reseller

• Consultant

Therefore, marketing channels make the manufacturers' and end-users' lives easier by acting as a medium to promote and distribute goods and services. They play a crucial role in our day-to-day lives and businesses.