Apple’s Channel Strategy Essay

1460 words - 6 pages

Channel strategy
An international marketing channel signifies an association of individuals and procedures that goods pass over to reach their final target. An operative international marketing channel permits organizations to influence its potential consumers at an economical price and within a rational extent of time. The distribution channel is the expression utilized to define the method in which goods or products are substantially distributed from the place they are produced to the location of the final customer.
The organization’s distribution strategy needs to be effective in order to reach the organization’s goals on gaining market share of their products. The international marketer is challenged in developing a distribution strategy because of the comprehensive array of substitutes for evolving an effective, reasonably priced, high capacity international distribution system (Cateora, Gilly, & Graham, 2013). Developing the correct price on goods can be the main element on the victory or disaster of the goods.
Distribution channels
Distribution channels presented in international markets are not too dissimilar from the channels in our nation the United States. The following illustration shows distribution flow:

Illustration 1: International channel of distribution alternatives (Carvens & Piercy, 2012, p. 284)
As shown, the arrows illustrate that there are numerous possible channel networks that connect the producers of the product, the agent middlemen, and consumers. However, it is important to understand, as indicated by Wren (2007), “The inference to be drawn is that firms will choose different strategies under different channel conditions” (p. 84). Conditions do change from country to country the product will be sold in. Firms need to be aware of price escalation. To attack price escalation the multinational corporation (MNC) marketer must look at reducing costs. Higher prices in a foreign country can deceive MNC marketers in believing that a profit can be made from the sale of their goods overseas. Import fees, agent middlemen, and transportation can drive prices of products higher. This is a solid reason on why a goods distribution strategy needs to be in place to keep costs at a minimum.
Apple’s distribution channel
Apple’s electronic products have appealed to the consumer’s eye. With their international products, distributional channels had to be set up for the demand of their product. Just about every retail store offers some version of the iPad from Wal-Mart, to Best Buy, and Target. They are using foreign retailers to market their product to the end user or the consumer. An additional retailer for Apple products is Tech Data. As indicated the AppleInsider Staff (2010), “Tech Data is a major Apple distributor, providing products including Macs iPods and Apple TV to IT solution providers in over 100 countries. The company generated $24.1 billion in sales for its last fiscal year, and ranked 102 on the...

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