Understanding the 5 Flows in Marketing Channels

Businesses often form strategic alliances to share products, services, and distribution channels. This allows them to expand their reach and grow their business in new markets. Retailers have been doing this since the 1950s, and it's still a popular practice today. For example, Monster Energy drinks are distributed through a partnership with Coca-Cola.

This relationship is beneficial for both companies, as it allows them to reach consumers through bottlers and distributors. The five flows in marketing channels are online marketing, retailing, wholesaling, physical distribution, and promotion.

Online marketing

is a relatively new concept that requires both the retailer and consumer to have access to a computer and modem.

Retailing

involves selling products directly to consumers in stores or online.

Wholesaling is when companies sell goods or services to other businesses or institutions that will resell or use them to produce other products.

Physical distribution

is the process of moving, manipulating, and storing products. Finally, promotion flow refers to the flow of persuasive communication such as advertising, personal selling, sales promotion, and public relations. When selecting a channel strategy, it's important to consider the separation, postponement, and acceleration of flow. For example, Virginia-raised turkeys may be shipped to New York before being sent to Virginia supermarkets.

In markets where product distinctiveness has been reduced, excelling in physical distribution activities can provide a competitive advantage. Manufacturers may also use their own sellers to sell to industrial buyers. Wholesalers must perform all the activities necessary for any business such as planning, financing, and developing a marketing combination. Specialty department stores like Neiman-Marcus and Saks Fifth Avenue send catalogs to create an upper-middle class market for expensive products. In conclusion, understanding the five flows in marketing channels is essential for businesses looking to expand their reach and grow their business in new markets.

By leveraging strategic alliances with other companies and utilizing different channels such as online marketing, retailing, wholesaling, physical distribution, and promotion flow, businesses can increase their visibility and reach more customers.