Question

In recent years, marketing channels have been getting more attention in marketing as an opportunity for a company to gain a strategic advantage over the competition. Why is this so? In other words, how does the company gain that competitive advantage?

Answer 1

marketing channels are the people, organizations, and activities necessary to transfer the ownership of goods from the point of production to the point of consumption.

It is the way products get to the end-user and they include:

1. Direct selling;
2. Selling through intermediaries;
3. Dual distribution; and.
4. Reverse channels.

A unique marketing channel can be a great way to differentiate your company and build a competitive advantage, often in industries where the product or service itself may be at risk of being undifferentiated .

If your company can develop a more effective or less expensive marketing channel to bring your product or service to the marketplace, you can develop a competitive advantage over other companies in your sphere of influence.

The competitive advantage includes:

• Distribute to customers at a lower cost
• Reduce customer acquisition costs
• Improve channel governance
• Reduce channel costs by centralizing channel functions
• Enable entrepreneurship while controlling costs