Achabal, Dale D.

Huser, Mary

Katz, Ariel

McKenna, Mark P.

bepress Legal Repository

Channel Management Issues

Santa Clara University School of Law

               Channel Management: A Business Perspective  Dale D. Achabal, Ph.D. Co-Chair – Department of Marketing Exec. Director - Retail Management Institute Leavey School of Business Santa Clara University   First Sale & Exhaustion in IP Symposium November 2010               D. Achabal – Leavey School of Business - Santa Clara University  Marketing Channels:  Interdependent Organizations • Access to the Market – Consumer Segments – Geographic coverage • Used to Gain / Sustain Competitive Advantage  • Information & Technical Expertise • Product  Availability & Customization • Financing & Negotiation  • Traditionally – Independent Ownership & Decisionmaking    Manufacturer Retailer Wholesaler  End User               D. Achabal – Leavey School of Business - Santa Clara University  Product Inter-Dependency  = Channel Complexity App Store Software iPhone/iPad Computer Server Accessories               D. Achabal – Leavey School of Business - Santa Clara University  Channels are Dynamic … . Consumers  Have Access to Tremendous Amounts of Information in a Multi-Channel World                 Introduction       Growth                        Maturity      Decline  Strategic Focus                 Market Creation                         Market Expansion     Market Share              Migration of Customer  Value Added                       Very High                      High/Medium                                     Low                       Very Low  Channel Mix     Number                  Few: Exclusive                     Several; Selective         Many; Intensive                    Few: Exclusive     Margins                            High   High to Medium                                 Low                    Very Low / High  0…                          Stage of PLC                         …n Sales $  Introduction Growth Maturity Decline               D. Achabal – Leavey School of Business - Santa Clara University  Buy Make 0% 100% Degree of Channel Control Corporate Contractual Administered Traditional Channel Members May Focus More on Exerting Power vs. Developing Trust               D. Achabal – Leavey School of Business - Santa Clara University  What Works Today, Won’t Work Tomorrow Acme Networks CUSTOMERS Direct Sales Direct VARs Distributors VARs Through acquisition  10% 30% 60% • Challenge in dealing with „free riders‟ in the Channel                 D. Achabal – Leavey School of Business - Santa Clara University  Channel Systems for Most (B-to-B) Hi-Tech Products are Very Complex  ACME  Hi-Tech Networks Direct Sales Direct VARs CUSTOMERS Distributor VARs OEMs System Integrators • Access to „Used‟ or „Refurbished Product‟ by Unauthorized Firms Creates Channel Conflict                 D. Achabal – Leavey School of Business - Santa Clara University  Organic Growth Mergers & Acquisition Very few companies rely exclusively on  “Organic Growth” in today‟s marketplace Growth paths Business effects The Categories Service partnerships Innovation partnerships Technology  partnerships Sales  partnerships  Business Flexibility  Complementary strengths as a (full service) benefit to the customer  Global presence  Cost efficiencies & synergies  Competitive advantages  Distribution of innovative technologies/solutions Partnerships Partnering is an Integral Part of a Company’s Growth Strategy               D. Achabal – Leavey School of Business - Santa Clara University  But ….. Partners Come & Partners Go ASN    Customer Service  Professional Services  Solution alliances Solution Partners   Direct VARS  Tier 2 VARS  Vertical resellers – Federal – Healthcare Distributors    Value-Add Distributors, Technical   Volume Distributors, Broadline Technology and  ISV   ISVs  OEMs  Technology partners  Developers  System Integrators               D. Achabal – Leavey School of Business - Santa Clara University  9© Copyright 2008 EMC Corporation. All rights reserved.EMC‟s Investment in Developing Innovative Technology (Approx. $10+B)NetworkIntelligenceAuthenticaRSATablus VeridDocumentumAcartusAsk Once X-HiveDocumentSciencesRainfinityProActivityCaptivaAcxiomVMware AkimbiValydIndigoStoneDolphin Internosis GeniantInterlinkAstrum Smarts nlayers VoyenceBusinessEdgeInfraLegato Kashya Avamar IlluminatorServicesVirtualization/Data MobilityResourceManagementContentManagementAvailability/ArchivingInformationSecurityCloud Infrastructureand ServicesConsumer/Small BusinessDantzMozyPiIomega1/03 1/04 1/07 1/081/05 1/06 1/10WysDMConchangoMergers & Acquisitions:  Drivers or Destroyers of Channel Relationships?               D. Achabal – Leavey School of Business - Santa Clara University  Key Takeaways • Channels:  – Complex & Dynamic – Need to be Designed from a Customer‟s Perspective – Growth Through Partnerships, Alliances, Mergers & Acquisitions – Conflict Will Always Exist; Key is How it is Managed  

Channel Management Issues

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Santa Clara University School of Law