Final answer:
A vertical marketing system in which a single firm owns the manufacturing, wholesaling, and retailing operations is known as vertical integration. This strategy streamlines operations and gives the company control over the entire supply chain, often leading to reduced costs and competitive advantage.
Step-by-step explanation:
The vertical marketing system where a single firm owns the manufacturing, wholesaling, and retailing operations is known as vertical integration. This approach allows a company to control and consolidate the entire process from the production of goods to their sale to end consumers. By owning multiple stages of production and distribution, a company can streamline operations, reduce costs, and have more control over the supply chain.
Vertical integration is often contrasted with a conventional marketing system where different stages of production and distribution are operated by separate, independent entities. This type of integration can save on overhead expenses and provide a firm with a competitive edge by having direct control over their products throughout the entire process from manufacture to sale.
The concept of vertical integration was famously applied by John D. Rockefeller in building his oil empire. He controlled every aspect from extraction to refining to transportation and sale of oil products, exemplifying this strategy's effectiveness.