1. Behavioral processes in marketing channels
Week 3
Instructor: Jungwan Lee

2. Learning objectives
Understand that behavioral processes such as conflict, power, role, and communication are inherent behavioral dimensions in marketing channels
Know the major causes of channel conflict
Recognize the major issues involved in managing channel conflict
Delineate the bases of power in marketing channels

3. Marketing channel characteristics
An economic system
A social system: behavioral process
Conflict
Power
Role
Communication process

4. Conflict vs. Competition
..is direct, personal, and opponent-centered behavior.
..blocking activities
Coupon war
Competition:
..is object-centered, indirect, and impersonal.
..interference
Private brand vs. National brand

5. Causes of channel conflict
Role incongruities
Resource scarcities
Perceptual differences: POP displays
Expectational differences
Decision domain disagreements
Goal incompatibilties
Communication difficulties

6. Channel conflict vs. channel efficiency
Channel efficiency ..is the degree to which the total investment in the various inputs necessary to achieve a given distribution objective can be optimized in terms of outputs.
Negative effect-reduced efficiency
No effect- efficiency constant
Positive effect-efficiency increased
General curve

7. Managing channel conflict
Detecting channel conflict
Early warning system
Marketing channel auditing
Distributors’ advisory councils
Appraising the effect of conflict
Resolving conflict
Channelwide committee
Joint goal setting
Distribution executive
Arbitration

8. Bases of power for channel control
Power..is the capacity of a particular channel member to control or influence the behavior of another channel members.
Reward power
Coercive power-Wal-Mart
Legitimate power-Franchisors
Referent power
Expert power

9. Behavioral problems in channel communications
Goal differences
Language differences
Other behavioral problems
Perceptual differences
Secretive behavior
Inadequate frequency of communication