What Are the Different Types of Channel Strategies?

Channel Strategy, also known as Marketing Channel Strategy / Strategy of Marketing Channel

Channel strategy

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Channel Strategy, also known as Marketing Channel Strategy / Strategy of Marketing Channel

It is an important part of the entire marketing system, and it is of great significance to reduce corporate costs and improve corporate competitiveness. It is the top priority in planning. As the market development enters a new stage, new changes are constantly taking place in the company's marketing channels, and the old channel model can no longer adapt to changes in the situation.

Chinese name

Channel strategy

Foreign name

Marketing Channel Strategy / Strategy of Marketing Channel

nickname

Marketing Channel Strategy

Location

Is an important part of the entire marketing system

1. Marketing strategies for direct or indirect channels

2. Long- or short-channel marketing strategies

3.Wide or narrow channel marketing strategy

4.Single marketing channel and multiple marketing channel strategies

5.Traditional marketing channels and vertical marketing channel strategies

Including channel expansion direction, distribution network construction and management, regional market management, marketing channel self-control and radiation requirements.

The choice of corporate marketing channels will directly affect other marketing decisions, such as product pricing. It same

I. First emerged as an element of the marketing mix in the 1950s

In the 1950s, the concept of "marketing mix" first appeared. Neil Bowton proposes a 12-factor "marketing mix" strategy designed to guide corporate marketing practices, namely "product planning, pricing, label, supply and marketing routes, personnel sales, advertising, promotions, packaging, display, support, physical distribution And market research. " This combination strategy has theoretically defined the scope of marketing research for the first time; it proposes "supply and marketing routes, personnel sales, display, support, physical distribution", etc. based on modern marketing channel strategy theory. Strategy.

Neil Bowden summarized for the first time the contents of various channel-related activities in marketing activities and conducted a preliminary analysis; and pointed out how to do well in marketing activities regarding the "supply and marketing routes, "Personnel sales, display, support, physical distribution" and other activities, analysis of issues that need attention. It can be said that Neil Bowden defined the research scope of marketing channel strategy theory; and emphasized that "supply and marketing routes, personnel sales, display, support, and physical distribution" must be coordinated with the other seven elements.

2. The concept of "channel strategy" was first proposed in the 1960s

In the 1960s, McCarthy proposed a far-reaching 4Ps combination strategy, that is, "product strategy, price strategy, channel strategy, and promotion strategy." This combination strategy made people find the most important factors from the more complicated marketing variables. For the first time, the concept of "channel strategy" was proposed.

Based on Neil Bowton's research, McCarthy summarized the 12 factors of marketing practice into 4 strategies.

The contents of the channel strategy include: strategies for various activities to enable target customers to access and obtain their products. It is suggested that various middlemen and marketing service facilities must be effectively used in order to provide products and services to target markets more effectively. Point out that manufacturers must understand the various types of retailers, wholesalers, and companies engaged in physical distribution and how they make decisions.

Third, the convenience of channels was emphasized in the 1990s

Due to the development of marketing, the original 4P combination is gradually replaced by the 4C combination, that is, the new marketing combination strategy of the four elements of "customer, cost, convenience and communication"; more emphasis on convenience (Convenience) in channel strategy, It means to provide consumers with as convenient a consumption channel as possible to reduce the non-monetary cost of consumption. For example, chain supermarkets provide residents with convenient and efficient services, which reflects convenience.

Emphasizing the convenience of channels here requires that channel construction be considered from the perspective of consumers to provide convenience to consumers. The emerging large-scale chain stores and online marketing can be considered as the implementation of this channel strategy. Implementing this channel strategy is a complex systems project, not only a change of concept, but also a process reorganization and an organization reorganization. It solves the problem of creating a convenient consumption channel for consumers, which often leads to a dramatic and dramatic increase in the spread of goods or market share. It should be noted that the channel strategy emphasized here-the emphasis on convenience is still combined with another "customer, cost, communication", convenience is only an important part of the channel strategy.

Entering the 21st century begins to emphasize relationship marketing

American scholar Don E. Schultz proposed a new "4Rs marketing mix" theory, that is, marketing should include the following four elements: association, response, relationship and return. In terms of channel strategy, it emphasizes relationship marketing, and emphasizes that manufacturers should establish long-term, stable and close relationships with customers, reduce customer churn rates, establish customer databases, and conduct database marketing to reduce marketing costs.

In the current market economy, business partners emphasize cooperation and a win-win situation; and so do manufacturers and customers. The cost of retaining an old customer is only one-fifth that of developing a new customer; and a satisfied old customer often brings more new customers, word-of-mouth advertising is one of the most effective advertising; and, due to modern information management Advances in technology have created technical conditions for manufacturers to establish long-term, stable, and close relationships with customers, enabling manufacturers to find older customers more quickly and accurately. The purpose of the channel is to establish a connection between the manufacturer and the customer, so as to realize the circulation of goods. In this sense, the channel strategy that emphasizes relationship marketing has begun to return to the core and original meaning of the marketing channel.

V. Chinese scholars' analysis of new trends in current channel strategies

Chinese scholars believe that the current trend of channel strategies is manifested in three aspects:

(I) The channel structure is centered on the construction of the terminal market. In the past, most companies focused on the top and middle of the sales channel to carry out sales work through market hype and large household policies; when the market became relatively saturated, the requirements for enterprises changed from "operation channels" to "operation terminals".

(2) Channel members develop partnerships. The traditional channel relationship is the relationship between "I" and "you", that is, each channel member is an independent operating entity, with the goal of maximizing individual interests, even at the expense of the overall interests of the channel and the manufacturer. In the partner-type sales channel, the relationship between manufacturers and distributors changed from "you" and "me" to "us". Manufacturers and distributors operate in an integrated manner to achieve group control of manufacturers' channels, so that scattered distributors form an organic system, and channel members work together to achieve their own or everyone's goals.

(3) The channel system has developed from a pyramid type to a flat direction. The sales channel is changed to a flat structure, that is, the sales channels are getting shorter and shorter, and the number of sales outlets is increasing. Shortening the sales channel can increase the company's control over the channel; the increase in sales outlets effectively promotes product sales. For example, some enterprises have changed from a multi-level wholesale link to a layer of wholesale, forming a model of manufacturer-dealer-retailer. Enterprises provide services directly to dealers and retailers.

First, the premise of the formation of channel strategy:

1. Changes in the market structure and the formation of the dealer class.

Take the electrical appliance market as an example: the early dealers were mainly state-owned Wujiaohua companies, and later there were individual dealers throughout the urban and rural areas. The big trend in recent years is the emergence of hypermarkets.

2. The scale of manufacturing enterprises has expanded and market competition has intensified

3. Improvement of infrastructure

--The transformation of the transportation system

--Improvement of the banking system

--The formation of cable television networks

Second, the typical channel structure

1. National channel structure

In a country like China, the complete marketing network of a national company should include the following links

--- Headquarters (General Distributor)

--- Provincial distributors, commonly known as first-level distributors

--- Prefecture level or several regional distributors in the province, commonly known as secondary distributors

--- County-level dealers

2. Typical general agent system

Typical provincial distributor or large regional distributor

3. Advantages and problems of manufacturing enterprise branches

Advantage

-Can use the dealer network to promote products quickly

-Low direct transaction costs in the short term

problem

-Enterprise sales are too dependent on general agents

-Distributors usually pay more attention to short-term benefits

-General agent loyalty has a great impact on sales

Restructuring of Sinopec's sales channels

Sinopec is China's largest integrated energy and chemical company, mainly engaged in oil and gas exploration, development, mining, and sales; petroleum refining, petrochemicals, chemical fiber, fertilizer and other chemical production and product sales, storage and transportation; oil and gas pipeline transportation ; Import and export of oil, natural gas, petroleum products, petrochemicals and other chemical products and other commodities, technology, import and export business; technology, information research, development, application. It is China's largest producer and supplier of petroleum products and major petrochemical products, and the second largest producer of crude oil. Sinopec has built the company's structure with reference to the international model, established a standardized corporate governance structure, and implemented a divisional management system with centralized decision-making, hierarchical management, and specialized operations. Sinopec currently has more than 80 wholly-owned subsidiaries, holding and joint-stock subsidiaries and branches, including oil companies, refining and chemical companies, sales companies and scientific research, foreign trade and other units. Its production assets and major markets are concentrated in the Chinese economy The most developed and active eastern, southern and central regions.

After 1998, Sinopec Sales Company has a total of 29 provincial-level oil companies, of which 22 are sales companies in the provinces south of the Great Wall that are responsible for local market development and product oil supply, and 7 are dispatched agencies of Sinopec Sales Company. Large regional company responsible for resource allocation, communication and settlement with oil refineries. These 22 sales companies are the central government's strategic deployment to expand and strengthen the national petroleum industry and realize the upstream, midstream, and downstream integration of the two major oil groups. They have been incorporated into Sinopec from various regional construction systems. Due to historical reasons, the sales company before the plan had heavy personnel burden, many management links, low operating efficiency, few sales outlets, and weak market control capabilities. After the plan, each sales company relied on Sinopec's huge capital investment and state grants. Gas station construction rights, franchise rights, and allow the two major groups of CNPC and Sinopec to implement asset reorganization on social wholesale business units, and carry out large-scale expansion, which has greatly increased its sales outlets and market regulation capabilities. .

Since 1999, in order to strengthen market regulation capabilities, Sinopec has invested more than 40 billion yuan in the construction, reconstruction, and purchase of gas stations. Its sales outlets have increased to more than 28,000. A retail network of gas stations covering provinces south of the Great Wall has been initially established This has laid a solid foundation for improving market regulation and improving sales structure. For example, Guangdong Petroleum Branch had only 651 gas stations before 2000, and its network share was only 13.6%; since 2000, the company was tired

With a total investment of 5.96 billion yuan, 1,430 new petrol stations have been added, and the network share has increased to 42.1%.

However, behind the large-scale expansion of Sinopec's sales companies, the drawbacks cannot be ignored. First, the subordinate prefecture-level branches are given too many management functions, and even the county operation department as the dispatch agency of the prefecture-level company is also managing the market, which causes the disadvantages of too many levels of management and slow market response. They are all established on the basis of administrative divisions. Discontinued uneconomic behavior often occurs in oil distribution, which has become an important reason for the high operating costs of Sinopec's sales companies.

The substantial increase in sales outlets has increased Sinopec's corporate profits, and it has been able to create favorable market conditions for the development of Sinopec's oilfield companies, refineries and chemical plants. However, merely relying on the extensional development strategy of increasing the number of sales outlets to achieve sales growth has not fundamentally improved the competitiveness of enterprises. Only by changing from the extensive growth mode of increasing the number of sales outlets to the intensive growth mode of improving the sales performance of unit outlets, improving operating efficiency and reducing operating costs, can enterprises calmly cope with the increasing market competition after entering the WTO.

According to China's WTO commitments, the domestic refined oil retail market will be opened at the end of 2004, and the domestic refined oil wholesale market will be opened before 2007. At the same time, the petroleum oil sales companies of PetroChina and Sinopec will lose the protection provided by the state. Sexual preferences.

Faced with this situation, in March 2004, Sinopec made great changes to its channels by reforming its sales management system, following international practices. The center is to implement professional management and regional company reorganization; at the management level, the original multi-level management will be changed to two-level management.

The common practice of multinational oil giants in oil product marketing management is to use the center of refined oil products as the center and delineate the corresponding distribution radius. Based on this, basic management units are established. Its jurisdiction is based on the principle of the lowest cost of oil distribution. It is not subject to administrative divisions. The basic management unit has a district manager. The district manager manages several nearby gas stations, and the gas station has a station manager. This management model can not only reduce operating costs, but also be highly efficient, and can respond to changing markets in a timely manner.

The overall idea of Sinopec's sales channel reorganization is to follow the principles of "regionalization, specialization, and flatness", focus on optimizing logistics distribution and strengthening marketing of refined oil products, and make full use of modern high-tech technologies to implement professionalism in logistics, retail, and direct sales. The new management system has been established with flat management level, vertical professionalism, clear positions and responsibilities, and flexible market response.

At the management level, the original multi-level management is gradually reduced to the two-level management of regional resource distribution and marketing by the headquarters; in the operation mode, the two lines of resource distribution and marketing are implemented. In the line of resource distribution, in accordance with regional economic flow, establish regional distribution centers, implement unified operation of resources, unified management of facilities, unified optimization of logistics, and unified organization of distribution to further reduce costs, increase profitability, and enhance market competitiveness; In the line of marketing, according to the specialized division of labor, retail implements professional vertical management of retail management center-area manager-ME-gas station, direct marketing implements commercial customer center-customer manager-professional vertical management of customers, strengthen marketing, Adapt to changes in external markets.

In the implementation steps, Yunnan Petroleum Branch and Guangdong Petroleum Branch, as models of the pilot units, first carried out management system reform, that is, the establishment of a provincial logistics center within these two companies, which will unify the province-wide logistics Management and operation, to achieve the separation of logistics and business flow; at the same time, select some cities and cities for cross-regional reorganization, and within the regional company according to the three lines of retail center, commercial customer center, and settlement center to manage vertically down to operating outlets, revoke county Operation Department. Through this reform, the management functions of provincial-level sales companies have been unprecedentedly strengthened. Correspondingly, prefecture-level companies have been given more responsibility to charge forward, develop markets, and increase sales. Provincial companies can strengthen their decision-making center status through specialized business centers on the one hand, so that company decisions can be made more quickly and accurately; on the other hand, they can rationally plan the flow of oil products through provincial logistics centers, that is, logistics distribution by provincial companies The center arranges the dispatch of oil products to gas stations and major customers. It centers on oil depots and formulates a reasonable distribution radius to avoid unnecessary losses. And the business departments of prefecture-level companies only need to focus on the development of the target market and the corresponding market management work. Through the specialized division of labor and regional company reorganization, the purpose of clear responsibility and close to the market has been achieved.

Amway's channel transformation in China

Founded in 1959, the American Amway Corporation is a world-renowned manufacturer and seller of consumer goods. Its business covers more than 80 countries and regions on five continents. There are more than 400 series of products under the trademark Amway. There are more than 12,000 employees worldwide and more than 3 million marketers. In 2002, Amway ranked 27th among the 500 largest private companies in the United States; the 50 largest household and personal products manufacturing companies ranked 4th; the company's total assets reached 38 billion U.S. dollars; and in the 45 years of continuous growth, Amway has never Loans to banks and maintain a record of no borrowing operations. Since Amway's two founders, Davies and Wen Anluo, were both salesmen, direct sales have been regarded by Amway as the most effective marketing method in the past fifty years. However, when Amway aggressively adopted this When the marketing model was introduced to China, they encountered unprecedented embarrassment.

In 1995, Amway officially settled in China. They invested 100 million US dollars in Guangzhou to build Amway's only overseas production base of modern consumer goods. They wanted to set off an Amway direct sales storm in China. But soon, various domestic MLM frauds under the banner of direct marketing disrupted Amway's market prospects. On April 21, 1998, the State Council's "Notice on Prohibition of MLM Business Activities" was promulgated to completely prohibit MLM (including direct sales) activities. For Amway, 1998 was undoubtedly a watershed in China. With its business in China banned in April this year, Amway began to seek a new way of survival in China. On June 18, 1998, the State Administration for Industry and Commerce issued the "Notice on Relevant Issues Concerning the Transformation of Sales Modes of Foreign-invested MLM Enterprises", allowing some foreign-funded MLM enterprises to switch to store operations and can employ salespeople. Approved in July 1998, Amway (China) Commodity Co., Ltd. officially adopted a new marketing method, changing from direct sales to a "shop + hire salesman" business model. The tradition of selling products through direct sellers has been completely broken. After the transformation, Amway transformed the more than 20 branches in the country into the first batch of stores, and later expanded these stores. All products are clearly priced, and consumers can go to the store directly to buy them, eliminating the problems caused by salesmen's own pricing. The new business model has brought new choices to consumers, and also allowed Amway to make new attempts to break through the original direct sales model. A variety of sales methods are simultaneously developed, which is also a challenge for Amway to integrate into China's national conditions. .

The "shop + hire salesman" model is the main content of Amway's channel transformation in China. Divis, one of the founders of Amway Corporation, bluntly responded to this transformation: "This is an unprecedented revolution in Amway in 41 years!" President Huang Deyin summarized the advantages of the "shop + hire salesman" channel model into the following three aspects: Guaranteed product quality: Through the direct sales model, Amway consumers will basically not encounter counterfeit and shoddy products; (2) provides a good sales channel: the store is not only a representative of the company's image, but also provides logistic services to marketers, It also directly faces ordinary consumers, and consumers and governments are more assured because of the existence of stores; (3) This model can directly benefit from Amway (China) 's active marketing methods. Bill Payne, Executive Vice President of Adalco, summarized Amway's changes as follows: "So far, this method of operation has been very effective. First, the establishment of a store has increased the company's transparency, allowing consumers to have a voluntary selection, purchase and preferential customers. Secondly, all products in Amway's 120 stores nationwide are clearly marked. The open price avoids the possibility of driving up prices. In addition, sales promotion by sales representatives makes up for the shortage of sales outlets, improves service quality, and enables Consumers enjoy more direct and friendly pre-sales and after-sales services. "

The new channel of "shop + hire salesman" successfully promoted Amway's transformation process in China. At the same time, Amway's management and rectification of employees are also stepping up. Beginning in January 2002, Amway (China) stopped joining new business representatives and trained and comprehensively reorganized existing staff. All marketing staff are contract employees of Amway, which means that Amway must assume Legal liability arising from the duties of a salesperson, the addition of a new salesperson will not generate income for anyone. In the management of salesmen, Amway has further increased transparency, developed a series of precise systems, and implemented them very strictly. From January 2002 to the present, Amway (China) has cleared nearly 600 sales personnel who are not civil servants, soldiers or students who do not meet the employment requirements. Its sales force dropped sharply from 130,000 in early 2001 to 70,000. At the same time, Amway (China) has also strengthened the management of its marketing team and regulated the behavior of its salespeople through training and strict reward and punishment systems. In the financial year of 2002-2003, Amway (China) investigated and punished 1,649 violations and punished 2,317 marketing staff.

Amway's channel transformation has brought it huge market benefits. The company's financial report shows that in the 2002-2003 financial year (September 2002 to August 2003), Amway (China) had sales of more than $ 1 billion, accounting for 20% of the company's $ 4.9 billion in global sales . In August 2003, the sales performance of Amway in Greater China has surpassed that of the Americas, and China has become the largest market for Amway's global turnover. As Bill Payne, Executive Vice President of Adalco, said: "We value the Chinese market, we respect China's national conditions, we follow Chinese rules, so we change our business model to adapt to China, and the result of all of this is: we have won China Market. "President Huang Deyin said," After just 9 years of development, China has surpassed the 45-year-old US market and become the largest market for Amway in the world. The success of Amway (China) fully illustrates the standardization of direct selling companies. Broad space in the fast-growing Chinese market. "In the" Asia's Best Employer Awards 2001 "jointly released by Hewitt Consulting and the" Asian Wall Street Journal "and" Far East Economic Review "in 2002, Amway (China) On the list. Among the "50 Most Admired Foreign-Invested Companies in 2002" by Fortune (China Version), Amway (China) is also on the list. According to a survey conducted by independent market research company in early 2004, Amway (China) 's popularity and reputation reached 93% and 75%, respectively.

Channel cooperation between Philips and TCL

Philips Electronics is one of the world's largest electronics companies, with sales of 29 billion euros in 2003, and is a world leader in medical diagnostic imaging and patient monitors, color TVs, electric shavers, lighting, and silicon system solutions. With 166,800 employees, Philips is active in more than 60 countries in the three areas of healthcare, lifestyle and core technologies. Philips entered the Chinese market as early as 1920. Since the establishment of the first joint venture in 1985, Philips has adhered to its long-term commitment to take root in China, bringing all five major businesses, including lighting, consumer electronics, home appliances, semiconductors and medical systems, to China, bringing the world's leading technology, products and Services have been brought to the Chinese market. At present, Philips has become one of the largest investment partners in China's electronics industry, with a cumulative total investment of more than $ 3.4 billion. It has established 35 joint ventures and sole proprietorships in China, has more than 60 offices across the country, and has more than 20,000 employees. . In 2003, the company's turnover in China reached US $ 7.5 billion and its international procurement reached US $ 3.83 billion.

Philips' channel model in China has gone a long way. Prior to 1997, Philips had always adopted direct construction in the South China market, controlled the mainstream channels, and then distributed its products to the terminals. Annual sales had always hovered around 7 million yuan. Out of the popularity and general success of the Philips agency system abroad, from the end of 1997, Philips decided to implement a regional general agent system in the South China market.

From 1997 to 1999, due to the full preferential agency policies given by Philips, the sales in the agency area of Philips increased linearly, and sales doubled year after year, reaching 230 million yuan in 1999. The market share of Philips' "Guangdong and Guangxi" all the way up 10%. At this stage, the general agent system has achieved substantial results for Philips, and it should be said to be a win-win stage.

However, as domestic color TV market competition intensified, the overall price fell sharply, and Philips' profits began to fall. In 2001, Philips began to plan for channel recovery and product upgrades. The goal was to spur agents at low gross margins, reduce channel costs, and increase retail price competitiveness.

In 2002, Philips changed its agent and the two parties came together to manage the market. However, as a foreign-funded company, the personnel cost and market management cost of Philips remained high, and it was still impossible to reverse the situation of small profits. In the end, Philips decided to commission TCL as the regional channel agent for 7 provinces in South China. In August 2003, Philips Electronics and TCL Group announced that the two major brand companies will cooperate in the sales channels of color TVs in the markets of five provinces and cities in China. This means that Philips TVs will take advantage of TCL's sales network to further achieve the goal of covering the low-end secondary market.

At the beginning of 2004, the South China office of Philips' audio-visual products in Guangzhou was officially dissolved, and the sales of color TVs in 7 provinces of Philips South China were completely transferred to the domestic color TV giant TCL. From the previous joint management channels of Philips, TCL became the independent channel and sales management company. Broader and deeper channel cooperation between the two parties is underway.

Dehua Zhang, the Guangzhou Ultimate Marketing Consultant Co., Ltd., who has been tracking Philips' channel management in South China, said in an exclusive interview with the Financial Times that the fatal injury to Philips was speed. Frequent channel replacement mechanism, the replacement speed of agents is too fast, causing channel factors to trigger market turbulence; on the other hand, the execution speed of brand and technology upgrades is too slow, and the upgrade speed cannot keep up with the natural increase of channels and markets. This caused the adverse consequences of the "Buffalo pulling a broken car"; in the end, the shortcomings of channel execution force made Philips fall into the dilemma of the South China channel. The reason why the marriage between Philips and TCL is widely concerned is that after Haier and Sanyo, TCL and Panasonic, Hisense and Sumitomo, domestic appliance companies have once again reached sales channel cooperation with multinational companies. For Philips, this is a new choice after many channel troubles. As for whether the results can be long-term, it is still difficult to draw conclusions. After all, the two sides put their own similar products in this channel, and TCL also cooperates with other manufacturers. How to solve the same competition situation of homogeneous products may be a challenge for both sides.

Liu Yongju, a well-known person in actual marketing planning in China, said in an exclusive interview with the Financial Times reporter that the channel short board for multinational companies such as Philips in China is related to their indifference to the competitive environment of the Chinese market. People are always "superstitious" multinational companies. In fact, in the face of a market with a special environment like China, multinational companies are not likely to "play" because they are familiar and good at it in a mature market. Operations, and the Chinese market is immature. From the 1990s to the present, the Chinese market is still in a stage of meeting demand, and basically there is no need to pull demand. The characteristic of this stage is that the sales power is greater than the market power, that is, the role of the channel may be greater than the role of marketing. Meeting the market demand mainly depends on the channel, so the greater the demand, the greater the advantage of the channel. Although saturation of certain types of goods may occur in some large cities, demand is still strong in China's vast small and medium-sized cities and rural markets. Coupled with China's vast territory and great differences, its culture is also regionalized, and the integration of consumer demand patterns has created huge challenges for multinational companies. In 2003, the chairman of Panasonic made a statement on the marketing strategy of the Chinese market, the main idea is: it is raining, we have to parachute. This shows that some multinational companies have realized that they must make corresponding changes in marketing strategies according to the special environment of the Chinese market.

Liu Yongju also pointed out: From the perspective of the market, the advantages and disadvantages of Philips' "borrowing" TCL channels cannot be seen in the short term, and it is difficult to say whether "borrowing channels" will make it easier to achieve market success. In this market atmosphere, only focusing on channel construction and ignoring others will only maintain short-term market success. As the market matures further and consumer demand for brands and personalized products rises, the advantages of channels will be weakened. Therefore, the current status of the channel is only triggered by the long-term inertia of the Chinese consumer market. Whether the future competition is "channel is king" or not depends on market changes. However, over-reliance on channels will cause production companies to be passive in future market competition. Take the home appliance market as an example. In just a few years, the channel has formed a strong independent force. In further expansion, channel companies have controlled production companies, so that when a channel company wants to block news of a certain brand, it is common in the media. Normal marketing is undoubtedly a production company's assessment of distributors and assessment channels. In China's home appliance market, it has become a channel member assessment of production enterprises. In the real frustration of home appliance companies, they are also worried that one day they will be "played" to death by channels. In addition, the value of a product should be composed of the value of the product plus the value of the brand. Under the situation where the channel controls the market, the value of the brand is shelved, and all manufacturers are fighting for the price. Over time, manufacturing companies will lose their potential for future development. Therefore, many domestic manufacturers have begun to build their own channels, such as Gree's joint distribution body. However, if a production company with no strength breaks with the channel, it means destruction. In history, both Changhong and Konka have suffered from channel problems.

Magtech: Cross-selling of IT accessories

Mega Technology Co., Ltd. was established in 1987 and is dedicated to the research, development and manufacturing of professional displays. Since its development, Meg has become one of the three major brands in the world. As Taiwan's cutting-edge technology industry, Magtech's success lies more in the creation of the MAG brand, making it a household name in the world, and striving to renovate the old image of Taiwan's industry in the world's industrial world. Ruimin's grasp of business opportunities in the world's industrial dynamics is a key factor that leads Meg's success in the international arena. In 1993, the first batch of MAG displays were shipped to the three major markets of the United States, Europe and Japan. In just a few years, Meg has become a world-renowned supplier of display equipment. Since August 2001, when MEG set off in the "photonic era", facing the challenge, Meg has proposed the "Five Core Ideas" based on Meg culture and the "Five Action Plans" based on the In-Ho strategy. In 2003, Magtech China Division moved the General Administration of Strategy from Shenzhen to Shanghai.

With the increasingly fierce market competition in the IT industry, the profits of IT products are becoming increasingly weak, and IT companies have begun to find new ways to reduce operating costs and increase market share. Some IT companies that have the ability to directly face end users have begun to flatten their channels, allowing them to go beyond layers of sales and deal directly with end users. Therefore, IT companies with rich product lines have the conditions to implement cross-selling.

The so-called cross-selling refers to the marketing method in which a company realizes the sales of multiple related services or products by discovering the multiple needs of an existing customer and meeting its needs. For example, the purchaser of a golf club membership card may also be a passenger car purchaser and a demander of health care services. Related companies can meet his multiple needs through joint cross-selling. This marketing method of providing customers with a more economical and convenient one-stop service is widely used in banking, insurance, retail, home appliances, automobiles and other industries. As far as the essence of cross-marketing is concerned, it is the sharing of user resources among various products and services, and it is a means of promotion to its own customers or customers of customers with certain market resources. The enrichment of the company's product line has made cross-selling, an innovative channel model, more suitable. Cross-selling is highly overlapping in the user base, consumers can get tangible benefits from cross-selling, and areas with consistent product channel models have good sales results.

In the IT industry, Magtech first tried a large-scale, standardized cross-selling of IT accessories products. There are certain reasons why Magtech has become the first "crab eater" in the field of IT accessories: firstly, the product line is enriched. In terms of product lines, Mage has continuously expanded its product range since 2002, expanding from a single display product to a variety of PC accessories such as displays, optical storage products, keyboards, mice, and chassis, and is still continuously Improve product lines. The second is the flattening of channels. Since 2001, Mage has transformed the traditional agency channels and established its own sales channels with 20 business platforms, more than 150 specialty stores, and more than 2,000 franchise stores. This channel capability is very rare among parts suppliers. . The rich product line and the ability to face customers are the prerequisites for the implementation of cross-selling. Therefore, changes in product lines and channel improvements have cleared the way for Mage to fully launch cross-selling.

From mid-October to December 10, 2003, Meg launched the first cross-selling campaign-"Meg's new forces to search for keyboard and mouse heroes". On December 15th, Meg launched the "New Heroes of the World" campaign. During the event, consumers who purchase two CRT monitors, MG 786FDX5 and 786FTII, will receive a free water keyboard, as well as various package discounts. Consumers who bought the 786FDX5 high-brightness CRT monitor and Skywalker I portable case package with Huntkey Cool Power can easily own the original price of 1898 yuan for the monitor and stylish case for only 1799 yuan. Consumers who purchase a combination of 786FDX5, Skywalker I portable case, and Mago Optical Mouse will only need 1849 yuan. Consumers who bought the 786FDX5, Skywalker I portable case, Meg optical horse mouse, and Meg dark horse DVD-ROM package can have a super desktop combination of RMB 2296 for the original price of RMB 1999. Consumers who purchase the combination of Meg 786FTII display and Skywalker II portable case can get a package with the original price of 1598 yuan at a low price of 1499 yuan. The discounted price for the purchase of the 786FTII, Skywalker II portable case, and Megger's mouse combo package is 1,549 yuan. In addition, consumers can purchase the 786FTII, Skywalker II portable case, Megger optical mouse, and Megger black horse DVD-ROM combination package at a discounted price of 1699 yuan.6DIY6

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Wahaha's comprehensive incentives, strict rewards and punishment channel policy effectively restricted the sales behavior of thousands of dealers, and provided a guarantee for the normal operation of the huge channel network. With its "cobweb" -like channel network, Wahaha's milk-containing beverages, bottled water, and tea drinks are sold to all corners of the country. In February 2004, the new product "Activation" was born. In early March, goods were put on the shelves. From hypermarkets, supermarkets to entertainment venues, transportation channels, schools and other traditional wholesale and retail channels, "Activation" appeared in what it can appear. Everywhere. Wahaha has used its channel network advantages to the fullest extent, ensuring that "activation" is quickly launched while forming a scale advantage.

In the face of Coca-Cola, Pepsi and Master Kong, a unified and comprehensive attack, Wahaha boldly innovated, tried to launch the sales terminal vigorously, and moved from rural to urban areas. President Zong Qinghou believes that there are currently three main channel ideas for beverage companies: one is the direct thinking of Coca-Cola and Pepsi, mainly for terminals; the second is the wholesale market model of Jianlibao; the third is the idea of joint marketing of Wahaha. Wahaha does not have an advantage in terms of brand and capital. The key is to promote strengths and avoid weaknesses, exerting their advantages as much as possible, and suppressing the strengths of the other party. Wahaha launched very Coca-Cola. From the beginning of listing, it did not compete directly with Coca-Cola and Pepsi. Instead, it aimed at the Midwest market and the vast rural market. Through misaligned competition and the use of a strong marketing network layout, it delivered its Coca-Cola to China Every village and corner zone in China takes advantage of the strategy of "rural surrounding the city" to occupy a place in China's carbonated beverage market.

Some scholars attribute Wahaha's success model to "three ones", that is, "one point, one net, one force". One point refers to its advertising promotion point, one network refers to the sales network carefully created by Wahaha, and one refers to the ability to operate dealers. The operation process of "Three Ones" is: firstly push new products through powerful advertisements, and use the advertising bombing to open up the market to form sales expectations; then use a strict spread system to make a sales network, and make the dealers obtain the first through clear spreads. One layer of profit; in the end, a variety of promotional policies are introduced every year to transfer part of the company's profits to operating dealers through daily promotions and year-end returns. But this model also has problems: when advertising is more and more emphasis on promotion, the product will become a "cultural-less" functional product, instead of becoming a "cultural product" like Coca-Cola, and as a result, advertising and product Rigid cycle between advertisements: Advertising must find the "selling point" more and more accurately, and products must highlight features more and more. As a result, the volume of advertisements must be larger and larger, or the functions of products must be innovative. Sales.