Value Chain Strategy Pertemuan 18 Buku 1 Hal: Matakuliah: J Strategi Pemasaran Tahun: 2009

Bina Nusantara Strategic role of value chain Channel strategy Managing the channel International channels Learning Objective

Managing the Channel (1) Channel leadership Management structure and systems Physical distribution management – Supply chain strategy – The impact of supply chain management on marketing – E-procurement

Efficient Consumer Response  Traditional channel problems – Forward buying and diverting – Excessive inventories – Damages and unsaleable goods – Complex deals and deductions – Too many promotions and coupons – Too many new products  Efficient Consumer Response – Category management – “Value” pricing replaces promotions – Continuous replenishment and cross-docking – Electronic data interchange – New performance measures – New organizational processes and structures – Internet-based network for supplier-buyer trading

Lean Supply Chain Elements 1. Definition of Value 2. Identification of Value Streams and Removal of Muda (Waste) 3. Organizing Around Flow, Instead of “Batch and Queue” 4. Responding to Pull Through the Supply Chain 5. The Pursuit of Perfection

Marketing/supply chain relationship Focus on real drivers of customer value not just technical Do not create inflexibility and inability to respond to change Protect brands and competitive strength over short- term cost savings Do not confuse supply chain strategy with competitive advantage

Managing the channel (2) Channel relationships – Degree of collaboration – Commitment and trust among channel members – Power and dependence Channel globalization Multichanneling Conflict resolution Channel performance Legal and ethical considerations

Channel metrics PerformancePossible MeasuresApplicable Product and ObjectiveChannel Level PRODUCT AVAILABILITY Coverage of relevantPercent of effectiveConsumer products at retailersdistributionretail level In-store positioningPercent of shelf Consumer products at facings or displayretail level space gained by product, weighted by store importance Coverage of Frequency of salesIndustrial products; geographic marketscalls by customerconsumer goods at type; averagewholesale level delivery time

Channel metrics PerformancePossible MeasuresApplicable Product and ObjectiveChannel Level PROMOTIONAL EFFORT Effective point-of-Percent of storesConsumer products purchase (POP)using specialat retail level promotiondisplays and POP materials, weighted by importance of store Effective personalPercent ofIndustrial products; selling supportsalespeople’s timeconsumer durables at all devoted to product;channel levels; consumer number of salespeopleconvenience goods at receiving training onwholesale level product’s characteristics and applications

Channel metrics PerformancePossible MeasuresApplicable Product and ObjectiveChannel Level CUSTOMER SERVICE Installation,Number of serviceIndustrial products, training andtechnicians receivingparticularly those involving repairtechnical training;high technology; consumer monitoring ofdurables at retail level customer complaints MARKET INFORM,ATION Monitoring salesQuality and All levels of trends, inventorytimeliness ofdistribution levels, competitors’information actionsobtained COST-EFFECTIVENESS Cost of channelMiddleman marginsAll levels of Functions relativeand marketing costsdistrbution To sales volumeas percent of sales

Value chain ethics Retailers’ Global Social Compliance Program Growing “green consumer” pressure B2B suppliers increasingly mandated to meet customer’s values in employment practices, environmental standards, ethical behavior

International channels Examining international distribution patterns Factors affecting global channel selection Global issues regarding multichannel strategies

International Channel of Distribution Alternatives Home countryForeign country The foreign marketer or producer sells to or through Domestic producer or marketer sells to or through Open distribution via domestic wholesale middlemen Exporter Foreign agent or merchant wholesalers Foreign retailer ImporterForeign consumer Export management company or company sales force Source: Philip R. Cateora, International Marketing, 7th ed., Homewood, Ill.: Richard D. Irwin, Inc., 1990, 572.