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The three basic functions performed by marketing intermediaries are transactional, logistical, and facilitating. The transactional function involves adding value to the distribution channel by bringing in the intermediary resources to establish market linkages and customer contacts
Companies that are able to increase their network of customer realize that achievement by increasing their customer retention. The customer retention rate of a company is a very important marketing metric due to the fact that based on the 80/20 rule 80% of a firm’s sales are achieved by 20% of their customers. Logistics refers to the physical distribution of the goods sold by a company. A firm that has gained a competitive advantage due to its superior logistics is the retail giant Wal-Mart. The production of a company is divided into smaller shipments to be distributed among the different clients of a company. On many occasions the logistics of a company involve storing the goods of the firm in a warehouse facility which serves the purpose of a distribution center. “The facility function includes financially supporting the marketing chain by investing in storage facilities” (Sharma, 2011). One of the advantages of using intermediaries is that it expands the market reach of a company. Sharma, A. (2011). Why Use Intermediaries in Marketing? Retrieved May 18, 2011 from http://www.marketingcrossing.com/article/220071/Why-Use-Intermediaries-in-Marketing/ 2. The article Getting the Most out of Retail Loyalty Programs starts the discussion by stating that customers are disloyal by nature (Johnson, 2005). ...
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