Core Concepts of Marketing

274 CHAPTER 10 CHANNELCONCEPTS:DISTRIBUTINGTHEPRODUCT

Conflict

Anytimeindividualsororganizationsmustworktogetherandrelyoneachotherforpe~­

sonalsuccess, conflictisinevitable.Conflict,unlikefriendlycompetition,ispersonaland

directandoftensuggestsa confrontation. Becauseit is sopervasiveindistribution,a great

dealofresearchh~$beenconductedmattemptstoidentifyitscauses,outcomes,andsolutions.

Thereisalsoa needtomanageconflictinthechannel.Thiscon:;istsof(1)estab,

lishinga mechani.smfordetectingconflicl,(2)appraisingtheeffectsoftheconflict, and

(3)resolvingtheconflict.Thislastconsiderationis mostdifficulttoimplement.Techniques

suchasa channelcommittee,jomtgoalsetting,andbringinginanarbitratorhaveallbeen

used.Thereareevencaseswhenconflictisnecessary.Suchisthecaseinthee-market-

place.Forexample,AnneMulcahy,PresidentofXeroxGeneralMarketsOperation,notes,

"Thosethatdon't aggressivelyembracemultiplechannelsformultipleproductswillget

leftbehind.Theinherent conflictinthisbusinessmodeiisnotonly a realityofbusiness;

it'sa signof a healthycompany."

Power

Powerisourwillingnesstouseforceina relationship.Itisoftenthemeansbywhichwe

areabletocontrolorinfluencethebehaviorofanothe~party.Inthechannelmechanism,

powerreferstothecapacityofa particularchannelmembertocontrolorinfluencethebehav-

iorofanotherchannel member. Forinstance,a largeretailermaywantthemanufacturel' to

modifythedesignoftheproductorperhapsberequiredtocarrylessinventory. Bothpar-

tiesmayattempttoexerttheirpowerinan attempttoinfluencetheother'sbehavior. T;le

abilityofeithe:-ofthepartiestoachievethisoutcomewilldependupontheamountofpower

thateachcanbringtobear.

MARKETING CAPSULE •

1.Threegeneralalternatives existinorganizingthechannel:

conventional, vertical, andhorizontal.

2.Thestepsinchanneldesignincludethefollowing:

a. Analyzethe consumer

b. Establishchannelobjectives

c. Specifythechanneltasks

d.Selecttheappropriatechannelfromavailable

alternatives

e. Evaluatetheresults

J .Channels mayexhibitseveralhumantraits:

a. Role

b. 2 ommunication

c. Conflict

d.Power