The Marketing Book 5th Edition

Supplier Intermediary Customer

Transactions at intermediary site:

e.g. RFPs, bids and auctions

through neutral intermediary

Transactions at supplier site:

e.g. Traditional purchase at

supplier website

Transactions at customer site:

e.g. RFPs, bids and auctions

E-marketing 659

panies think about making their products
available on-line, the tendency is to think only
in terms of selling direct from their website (a).
However, other alternatives for selling prod-
ucts are from a neutral marketplace (b), such as
CommerceOne (www.commerceone.net), and
also through going direct to the customer (c) –
an example of this is a B2B auction such as that
described for GlaxoSmithKline in the previous
section, where the supplier goes to the custom-
er’s site to bid.
A few examples of other concepts of place
which have been changed on-line are as
follows:

 Disintermediation. This is removing the
middleman to deal direct with customers
instead of through agents, distributors and
wholesalers. Note that this can create channel
conflict as middlemen feel the squeeze. For
example, Hewlett-Packard sell a lot of
equipment to hospitals. But when hospitals
started going directly to the HP site firstly for
information and secondly to place orders, it
posed a big question: do we pay commission
to the sales representative for this?
 Re-intermediation. This is the emergence of new
types of middlemen who are brokers, such as
Bizrate that unite buyers with sellers.
 Infomediation. A related concept where
middlemen hold data or information to benefit
customers and suppliers.

 Channel confluence. This has occurred where

distribution channels start to offer the same

deal to the end customer.

 Peer-to-peer services. Music swapping services

such as Napster and Gnutella opened up an

entirely new approach to music distribution

with both supplier and middleman removed

completely providing a great threat, but also

opportunity to the music industry.

 Affiliation. Affiliate programmes can turn

customers into salespeople. Many consider

salespeople as part of distribution. Others see

them as part of the communications mix.

Excellent distribution requires a deep under-

standing of when and where customers want

products and services. Partnership skills are

also required, as much distribution is externally

sourced, whether order fulfilment, warehous-

ing, logistics or transport.

Promotion

The Internet can be used to extend and inte-

grate all communications tools, as summarized

in Table 25.3.

Although websites can be considered a

separate communications tool, they are perhaps

best thought of as an integrator of all 10 tools

shown in the table.

The following are offered as guidelines for

effective promotion tactics (see Table 25.4):

Figure 25.9 Alternative representation locations for on-line purchases