Marketing channels play a crucial role in guiding how products reach consumers.
They encompass Direct and Indirect Marketing channels and Franchises.
Direct Marketing involves manufacturers or individuals selling their products directly to consumers without intermediaries. For example, a carpentry business sells bookcases through its store or online.
Similarly, brands like Samsung sell products through their own stores or websites.
This method offers the manufacturer complete control over pricing and customer experience.
On the other hand, Indirect Marketing leverages intermediaries, such as wholesalers or retailers, to reach customers. Like a clothing brand selling through department stores.
It enables a broader reach and leverages established infrastructure and networks of intermediaries.
Franchising, the third channel, involves a franchisor granting a franchisee the right to operate under its brand name for a fee or profit share.
This model, exemplified by McDonald's global operations, allows for rapid expansion with reduced risk and capital expenses for the franchisor, as the franchisee takes on the debt and liability for expansion.
Each channel type adds value to the manufacturer, intermediaries, and customers, balancing reach and cost-effectiveness.