What statement is true about marketing channels?

Which of the following is an example of power being exerted within a marketing channel?

Although all companies in the channel are independent, one large retailer controls what a small supplier can do.

When five employees of a small manufacturing plant are caught stealing from the company, they are fired and replaced.

Two dozen customers picket a large retail chain, demanding that it stop selling products made in China.

Two small retailers in the same town inform their common supplier that they cannot accept deliveries on Saturdays.

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Choose the correct code for the following statements being correct or incorrect.Statement I : A well-chosen marketing channel must be aligned to company's marketing strategy with respect to segmentation, targeting and positioning.Statement II : Marketing channels are set of interdependent organizations participating in the process of making the product available for the use of consumption. 

1. Both the statements I and II are correct.
2. Both the statements I and II are incorrect.
3. Statement I is correct, but II is incorrect.
4. Statement II is correct, but I is incorrect.

Answer (Detailed Solution Below)

Option 1 : Both the statements I and II are correct.

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Statement I: A well-chosen marketing channel must be aligned to the company's marketing strategy with respect to segmentation, targeting, and positioning.

Explanation: 

1. Segmentation, Targeting, and Positioning (STP) marketing is one of the most popular strategic marketing modules used by businesses today, and for good reason.
2. The STP model is an excellent embodiment of the gradual change in focus from a product-centric approach to a customer-centric approach, which enables companies to better understand who they are trying to reach and how to position themselves for success. 
3. STP marketing stands for segmentation, targeting, and positioning.
4. It is a three-step process that allows for the development of a specific and actionable marketing strategy.
5. The main principle behind the process is to segment your audience, target each segmented group according to their preferences and habits, and make positioning adjustments in your branding and marketing strategies to accommodate their needs and expectations.
6. The reason why the segmentation-targeting-positioning process is so effective is that it breaks down broader markets into smaller parts, making it easier to develop specific approaches for reaching and engaging potential customers instead of having to use a generic marketing strategy that would not be as appealing, or as effective.
7. Thus, the marketing channel and strategy should be well-aligned with the company's STP for effective success. Thus, the statement I is correct.

Statement II: Marketing channels are a set of interdependent organizations participating in the process of making the product available for the use of consumption. 

Explanation: 

1. ‘Marketing channels refer to an organized network of interconnected organizations and agencies involved in the process of making a product or service available to consumers.’
2. The marketing channels are interdependent business organizations.'
3. They are also known as the middlemen, intermediaries.
4. There are various forms of these intermediaries.
5. They bear a variety of names. They act as an interface between the firm and its customers.
6. They facilitate the producers and ensure a smooth flow of products/services to the customers.
7.  Richard M. Clewett views as – “it is the pipeline through which a product flows on its way to the consumers.
8. The manufacturer puts his product into the pipeline or marketing channel and various marketing people move it along to the consumers at the other end of the channel”.
9. Thus, statement II is correct.

Thus, option 1 is the correct answer.

Last updated on Oct 19, 2022

The UGC (University Grants Commission) has released the Provisional Answer Key for December 2021 and June 2022 cycle (combined). The response sheet has also been released along with the answer key. Candidates can match and submit their objections against the answer key by 20th October 2022 before 5 pm. Earlier, the UGC NET Admit Card. The admit card has been released for the exam which is scheduled to be held on 14th October 2022. Candidates can download their admit cards through the official portal. The UGC NET CBT exam will consist of two papers - Paper I and Paper II. Paper I will be conducted of 50 questions and Paper II will be held for 100 questions. 

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