Session:17 Distribution: Delivering Customer Value

Answer Key

Principles of Marketing | Leadership Development – Micro-Learning Session

Rice University 2020 | Michael Laverty, Colorado State University Global Chris Littel, North Carolina State University| https://openstax.org/details/books/principles-marketing

17.1 Knowledge Check

1. d. A marketing channel is a collection of people, organizations, processes, and activities that work
together to deliver products and services to the consumer.
2. d. Agents serve as representatives of manufacturers. While they never take possession of a product or
service, they earn a commission or collect a fee for facilitating the transaction between the customers and
the manufacturer.
3. c. When intermediaries are removed from the marketing channel, manufacturers must then be solely
responsible for distributing products directly to all customers. Thus, the number of transactions would
increase.
4. a. Intermediaries add value by performing important activities that manufacturers are not expert at
performing. This helps create efficiency in the marketing channel, which helps meet the wants and needs
of targeted customers.
5. d. Accumulating, bulk-breaking, adjusting for assortment discrepancies, and providing financing are the
valuable services that intermediaries provide.

17.2 Knowledge Check

1. b. A direct marketing channel sells and distributes directly to the consumer without the use of
intermediaries.
2. b. An indirect marketing channel relies on a partnership with intermediaries to sell and distribute its
products.
3. c. In the B2B or industrial space, manufacturers or producers sell products and services aimed at reaching
a business end user.
4. b. In a corporate vertical marketing system, one channel member owns one or more other channel
members.
5. c. Omnichannel marketing systems allow consumers to buy and receive products and services seamlessly
across a variety of channels, including online and in-store.

17.3 Knowledge Check

1. a. The three overarching factors that impact channel choice include target market coverage, fulfillment of
buyer requirements, and profitability.
2. d. An intensive distribution strategy is used when a company wants to distribute through every possible
retail outlet where a consumer might find its products.
3. b. A post-sale service is a buyer requirement that is fulfilled after the purchase of a product.
4. c. Perishability is an important factor in channel decisions for companies who sell products that have a
short shelf life.
5. d. Profitability is a factor that companies consider when choosing a distribution channel. Companies are
attracted to channels that help them maximize profits and operate more efficiently.
685

17.4 Knowledge Check

1. c. Manufacturers should select channel members based on years of experience, reputation, experience
within the market, and profitability. In the scenario above, selecting a channel member based on
experience, reputation, and profitability makes the most sense.
2. c. Production Company C and DirectDocumentaries are involved in a well-managed relationship. There is
cohesion and transparency, and they share common goals.
3. d. Disintermediation occurs when a channel member is removed from the distribution channel.
4. a. Order accuracy rate is the percentage of orders that are processed, fulfilled, and shipped to consumers
without any errors.
5. b. Time to ship is a metric that measures the length of time from when a customer places an order to
when it reaches them.

17.5 Knowledge Check

1. c. Supply chain management entails managing all the members and activities from the procurement and
transformation of raw materials into finished goods through their distribution to targeted consumers.
2. a. In order for companies to deliver on their value proposition to consumers, they must ensure that the
activities and members in the supply chain share the common goal of delivering value to consumers.
3. d. Companies that manufacture goods rely on raw materials to produce the products they sell. They
purchase the required materials from suppliers, who must be able to deliver them in accordance with the
manufacturer’s timeline.
4. d. Resources include the labor, the raw materials, and the technology that are required to move products
from their raw material phase to finished goods available for consumption.
5. a. Information workflow is a supply chain management function that relates to what and how information
moves between members of the supply chain.

17.6 Knowledge Check

1. b. Air transportation provides the fastest delivery speed over trucking, rail, and water transportation.
2. b. Logistics is the planning, organizing, and controlling the movement of raw materials and ultimately
finished goods to end consumers
3. c. Companies use logistics information to develop demand forecasts and conduct supply planning. It can
also be used to analyze and assess the effectiveness and efficiency of the supply chain to ensure
optimization.
4. d. Integrated logistics management ensures that every element of logistics as part of the entire supply
chain is part of a system that works cohesively to ensure that the wants and needs of final customers are
met.
5. a. 3PL providers have the expertise, flexibility, and cost efficiencies in logistics that manufacturers don’t
possess.