Sales channels in marketing, their meaning

Virtually all modern companies in the processpromotion and sales of goods use intermediary services. Depending on the chosen strategy and the size of the organization, it can be distributors, wholesale dealers of different sizes. Companies that transfer goods from the producer to the consumer form marketing channels in marketing.

Unfortunately, for today not all companiesgive decent attention to managing sales channels. Often, the old-fashioned management focuses on managing internal processes, although management must monitor the effectiveness of the entire economic chain. However, it should be borne in mind that the involvement of intermediaries is useful in terms of costs - their services will be cheaper than the organization, for example, their own delivery system, and besides they perform such work more qualitatively, since they can focus on performing limited functions, which ensures higher level of services.

Marketing channels have the following functions:

- In the part of external logistics, goods are moved to a potential buyer in order to ensure its availability;

- in terms of marketing and sales, the collection of necessary information about customers, as well as measures to offer goods to the market;

- in terms of providing related services that support and increase the value of the product.

The characteristics of sales channels include:

- the quality and quantity of services provided by the distribution channels, as well as their cost;

- coverage of the sales network by the sales channel;

- the ability of individual intermediaries to carry out transactions on favorable terms;

is the length of the channel.

Let us dwell on the latter in more detail. The length of the channel is an important parameter of any sales, that is, how many intermediaries exist on the way to the client. Sales channels in marketing significantly affect the sales of goods.

The direct marketing channel isdirect sale by the manufacturer to the final buyer of the goods. An example is a retail store in production. The most common are similar channels in the service sector, where the production and sales process is combined. A single-level distribution channel is characterized by the presence of a single intermediary, a two-level distribution channel - by the presence of two or more intermediaries. An example of such a channel are the channels for marketing a tourist product.

The longer the channel, the more expensive the product price forthe consumer. The cost of distribution channels is from 50% of the final cost of the goods. The use of long channels of sales leads to a decrease in the producer's profitability to ensure a competitive price of the goods. Therefore, monitoring the effectiveness of the marketing channel is a determining factor in the manufacturer's profitability and competitiveness.

Although long channels are quite costly,manufacturers of mass-use goods often do not have other options to win a place in the market. And the opportunities and motivation of partners who are part of the sales channel determine the opportunities for winning a buyer.

The process of determining the optimal distribution channel consists of the following:

1. Determine the requirements for channels, establish criteria for their evaluation, based on the marketing strategy, goals and capabilities of the company.

2. Determine the list of options for sales channels.

4. Evaluation of each option according to established criteria.

5. Choosing the best option.

Due to the fact that marketing channels in marketingare essential, a thorough approach to the selection of optimal distribution channels, organization of the structure, ways of interaction is necessary. This is a fundamental decision that determines the long-term effectiveness of the producer of goods and services.

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