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How to distinguish the types of marketing channels?

By Davies Zhai - Jetek Staff

Direct Marketing Channel

A direct marketing channel combines all stages of the marketing channel, from producers to consumers, under a single owner, to serve a target market segment. Thus, in direct channel marketing, most or all stages of the marketing channel are under common control. The advantage is that marketing activities can be coordinated for maximum effectiveness and economy without duplication of channel functions.

The main disadvantages are the high expenses of maintaining the entire channel and the often limited reach of the channel. Supermarkets that own their own food-processing plants and large retailers that purchase wholesaling and production facilities are examples of direct channels.

Indirect marketing channels

In an indirect marketing channel, several independently owned channel members work together to serve a target market segment. Most grocery manufacturers, for example, rely on indirect channels such as wholesalers and supermarkets for the distribution of their products. The main advantages of such a channel are the low channel management costs and greater reach and flexibility. The disadvantages are that marketing activities cannot be always controlled and sometimes channel functions are duplicated.

Multiple marketing channels

Multiple marketing channels are a combination of direct and indirect channels whereby each channel is used for different target market segments. For example, textbook publishers sell textbooks to students through their own online shops and independent bookshops but sell books to university professors through their own sales representatives. One disadvantage of multiple marketing channels is their complex coordination and different degrees of control. The main advantage of such a channel type is its differentiated approach to serving different target market segments.

Hybrid marketing channels

A hybrid marketing channel is a combination of direct and indirect channels whereby different channels are used for the same target market segment. An example of a hybrid marketing channel is a company that sells products through retail outlets and its own mail-order catalog or website, in each case targeting the same consumers.


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