Developing and Managing Products

Learning Objectives Covered LO 03.01 – Describe and discuss four types of marketing channels Background Person online shopping on a laptop screenIn marketing, a channel is the network or pathway between the person or company who created a product and the consumer or end user who purchases it. A channel could be a store in a mall, a website, a mail order catalogue or direct personal communication between a maker and a buyer. How you market varies a bit depending on the channel that is being used. Though it can be confusing, there are four basic types of channels that can help guide you when thinking about your marketing options. The four basic types of channels are: direct selling channels indirect selling channels dual distribution channels reverse channels Direct Selling Direct selling is when makers sell products directly to consumers. These sales happen outside of a conventional retail store. Examples of direct selling include companies like: Avon, Mary Kay, and Pampered Chef. Other examples include farmers markets and craft fairs. Direct selling is a good marketing outlet if you are extroverted and committed to building connections and putting in the time and effort selling your own product. Indirect Selling Indirect selling is a marketing channel where wholesalers and retailers are used to make a product available to customers. Indirect selling most commonly happens in traditional retail stores. For example, when you go to the grocery store you do not buy milk directly from the dairy that produced it. Instead, the dairy sold it to an agent, who sold it to a wholesaler, who sold it to a grocery retailer who then is selling it to you. Indirect selling is a good marketing outlet if you are not as comfortable selling your product on your own. In addition, indirect selling is a good marketing outlet if you would like to reach a wider audience than places you can travel on your own. Dual Distribution Dual distribution is when a product is marketed through two or more channels in order to reach the most customers. For example, a product might be sold in a grocery store and also at a farmer’s market or directly from the maker via a website. Dual distribution is a marketing outlet that combines the best of both worlds. You can both market the product yourself in a direct selling method and have the larger scope of an indirect selling market. Reverse Channels The first three channels flow from produce to consumer. In reverse channel, this flow literally reverses. The consumer is the one who provides raw materials and is paid and the producer is the one who gets the item being exchanged. An example of this is the deposit fee paid in some states for turning in glass or metal. Another example of this is resale or consignment clothing where a consumer brings in and is paid for their used clothing. Reverse channel is a marketing outlet that flips the normal flow of goods and services on its head. It is a way to empower everyone to become part of the consumer goods and services cycle. Prompt Step 1: Discussion Questions to Answer In this discussion, we will be discussing marketing channels. Imagine a friend comes to you asking for marketing advice. Your friend designed a line of illustrated greeting cards and is now looking to market them to a larger audience. They have no idea where to begin and are feeling very overwhelmed. How would you describe the four possible marketing channels to them? Which channel would be better if they were very shy and had a hard time presenting themselves? Which channel would be better if they were very extroverted and loved to talk and meet new people? If you were in your friend’s shoes and wanted to market a product you’d created, which marketing channel would you most likely choose? Why? For your citation, use articles that describe the marketing cycle or read case studies on how you can market/sell handmade or hand-crafted items. Try to write at least 250/300 words in your response. Remember there is not one correct answer in this discussion. Instead, conduct research on what others have done in the same type of situation. Many graphic designers maintain freelance businesses so it is vital to know how to market yourself and your products. For your citation, you might use articles that describe the buying decision process or the types of consumer decision making.