Task:
Advertising: product, place/market where available, manufacturer, price, quality and quantity. Manufacturer's reputation goes a long way in helping a customer make up his mind to purchase the item. A customer will be prepared to pay higher price for the reputed manufacturer's product than to one manufactured by unknown producer, even though the quality may be better than the former's. The intermediary advertises about the product and the offers that he is making on the purchase of it to buyers.
Advertising is the means of communication persuading audience to continue buying the same product or try a new one
The messages are generally sponsored and viewed on TV, Magazines, Radio, or these days through direct mails, blogs, websites or text messages. Intermediary arranges for all these facilities leaving the manufacturer concentrate on production.
Provide three examples when advertising to intermediaries might be necessary? What are the objective(s) of such advertising?
A) In the first the resources of intermediaries are channelized in setting up marketing linkages and contacts with customers. Intermediaries either themselves perform this role or engage the service of specialized agencies particularly in case of highly sophisticated technical items.
B) Logistical: It is a vital role in maintaining the price level by helping the producer keep low inventory and distributing the finished products fast. It is physical distribution of product after sorting and storing and making available to final consumer when needed. It enables the producer use the vacant space for any more useful alternative use, and avoid blocking of huge funds in inventory and storing finished goods.
C) Facilitating: The intermediary arranges for storage and renders financial support to the marketing chain. He further helps buyers purchase in installments.
Together, these functions performed by the intermediary ensure market coverage, reduce the cost of market coverage, increase the availability of cash flow in the distribution channel, and increase end-user convenience. A producer can bypass an intermediary by elimination or substitution, but the tasks performed by the intermediary cannot be eliminated.