Today many firms have resorted to the use of multichannel marketing in order to reach their target markets better. The integrated use of the hybrid distribution strategy can improve the adaptability of the company to the changing needs of buyers (Webb and Hogan 338). Typically, companies who make use of this new emergent trend are able to combine Internet resources, such as websites, webstores, mail orders, etc., into their marketing campaign. This form of multichannel distribution allows firms with different product lines to target their potential customers more effectively. However, in order to ensure that the whole system works smoothly, organizations need to make sure that their channels supplement each other in an efficacious manner as well as give customers a chance to use their preferred means of doing business. Therefore, the aim of this report is to define the multichannel distribution approach as well as the risks and benefits associated with it.
In general, hybrid distribution channels have been developed as a response to changes in consumer behavior, market globalization and the popularity of the Internet (Webb and Hogan 338). Supplier firms who are upholding this strategy usually aim at reducing costs and expanding market share (Webb and Hogan 338). As a result, channel managers have been exposed to more pressure because of this intricate distribution systems. IBM was the first to name multichannel marketing distribution mechanism the “hybrid distribution strategy” (Webb and Hogan 338). In essence, this method of distribution allows for the use of different product dissemination networks by one single firm (Webb and Hogan 340). As a result, companies can focus of different offerings and delivering them to varying target markets with the help of the most suitable means. Usually, every single channel is supported by a coalition that has a responsibility of managing and supporting its activities (Webb and Hogan 340). Such channel coalitions consist of varying representatives of the distribution system, such as a sales force, a distributor, an Internet store manager, a mail-order catalog operator, an outlet manager, etc. (Webb and Hogan 340). Another classification of online hybrid distribution channels into mobile, tablet and computer-based dissemination options exists (Thakran and Verma 245).
Even though multichannel distribution approach has been extremely effective for given product-markets, it still raises some concerns from the technical and behavioral standpoints. For instance, Thakran and Verma (245) list emerging trends for the new era of online multichannel distribution systems. They require more proficient knowledge of HTML, provision of consistent information throughout all means of distribution, targeting on the basis of customers’ location, reviews management, and other new emerging trends, such as Google Goggles, which allow information to be shared instantly (Thakran and Verma 245).
Moreover, internal conflicts among channel groups can make the focus of the company shift away from the customer (Webb and Hogan 339). Within this internal clashes, the emphasis has predominantly been on vertical relationships, i.e. between the wholesaler and industrial manufacturer, which has proven to be a fruitless practice (Webb and Hogan 338). It is advisable for the firms to focus on horizontal relations between channel coalitions in order to solve the internal struggle.
All things considered, multichannel distribution system is a complex but manageable marketing endeavor. With sufficient focus on the needs posed by emerging trends and horizontal relations between channel coalitions, firms will be able to use them efficiently. In order to diversify their dissemination techniques, companies have to be consistent in their messages to different target groups of customers and proficient in the technical aspects of each of their distribution channels. Emergent trends may be creating more opportunities for manifold techniques of product delivery to varying targets, but it is necessary for the companies to ensure individual as well as joint effectiveness of their choices.
Works Cited
Thakran, K., and R. Verma. "The Emergence of Hybrid Online Distribution Channels in Travel, Tourism and Hospitality". Cornell Hospitality Quarterly 54.3 (2013): 240-247. Web. 7 April 2016.
Webb, Kevin L., and John E. Hogan. "Hybrid Channel Conflict: Causes and Effects on Channel Performance". Journal of Business & Industrial Marketing 17.5 (2002): 338-356. Web. 7 April 2016.
