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Chapter 15 - Managing Marketing Channels and Supply Chains
12-33
TEACHING NOTE FOR VIDEO CASE VC-12
Amazon: Delivering the Earth’s Biggest Selection!
Synopsis
Show Slide 12-39. Amazon’s CEO, Jeff Bezos, predicts a new age of power for
customers who are enabled to search for and purchase a growing variety of products online.
A pioneer of fast, convenient, low-cost virtual shopping, Amazon is now a household name.
Teaching Suggestions
Ask students to identify three relatively successful examples of e-commerce other than
Amazon. Then have them match these companies with competitors whose distribution does not
rely primarily upon the Internet. Finally, ask the students to compare the relative strengths and
weaknesses of each competitive pair.
[Video 12-4: Amazon Video Case (kerin.tv/cr8e/v12-4)]
Answers to Questions
1. How do Amazon.com’s logistics and supply chain management activities help the
company create value for its customers?
Answers:
b. Logistics and supply chain management activities lead to benefit enhancement by:
• Offering competitive pricing. Lowered costs due to improved supply-chain
performance can be passed on to consumers as lower prices.
Chapter 15 - Managing Marketing Channels and Supply Chains
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2. What systems did Amazon develop to improve the flow of products from suppliers to
Amazon distribution centers? What systems improved the flow of orders from
distribution centers to customers?
Answers:
a. Flow of products from suppliers to distribution centers. The center of the
e-business supply chain is an information hub, where incoming information is quickly
3. Why will logistics and supply chain management play an important role in the future
success of Amazon.com?
Answer:
There are many internal tasks within an e-commerce company like Amazon, which begin
when a customer places an order. Placing an order begins a series of transactions
throughout the supply chain. An order must be quickly and accurately delivered as a result
Chapter 15 - Managing Marketing Channels and Supply Chains
Epilogue
Amazon continues to develop new and innovative approaches to logistics and supply
chain management. CEO Jeff Bezos recently announced that in the next few years Amazon
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ICA 12-1: IN-CLASS ACTIVITY
Marketing Channels for Apple1
Learning Objective. To have students learn about the marketing channels Apple
currently uses to sell its computers, digital devices, and software products to consumers.
Steps to Teach this ICA.
1. OPTIONAL: Bookmark the following websites on your classroom computer:
2. To determine how familiar students are with Apple’s marketing channel structure, ask
them the following question:
• Question 1: Within the last year, have any of you purchased a product (iMac,
iPad, iPhone, iPod, software, etc.) marketed or sold by Apple? If yes, where
did they purchase it?
3. Ask students the following questions regarding Apple’s marketing channel structure:
• Question 2: Consumers can buy Apple products online through its Apple
Online Store. If you were to purchase an Apple product from the Apple
Online Store (http://store.apple.com/us), (a) identify the channels members
as a producer, wholesaler, and/or retailer and (b) classify the channel
strategy used by Apple and its channel members as direct or indirect.
Chapter 15 - Managing Marketing Channels and Supply Chains
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• Question 3: Apple has over 400 Apple Retail Stores, including many in
foreign countries. If you were to purchase an Apple product from an Apple
Retail Store (www.apple.com/retail), (a) identify the channels members as a
producer, wholesaler, and/or retailer and (b) classify the channel strategy
used by Apple and its channel members as direct or indirect.
Answers:
• Question 4: Under its Authorized Apple Reseller program, Apple has also
established a relationship with Best Buy, the #1 retail electronics chain in the
U.S. Each store’s layout is organized into departments. The computer
department contains Apple hardware and software products and is staffed
by Best Buy employees. Assume that Best Buy obtains its entire inventory
from Ingram Micro, the nation’s largest technology product distributor.
If you were to purchase an Apple product from Best Buy
Answers:
(a) Channel members are “Producer (Apple)→Wholesaler (Ingram
• Question 5: Under its Authorized Apple Reseller program, Apple has also
established a relationship with MacMall, which sells Apple products online,
by telephone, through its catalog, and a retail store. If you were to purchase
an Apple product from MacMall (www.macmall.com), (a) identify the
channels members as a producer, wholesaler, and/or retailer and (b) classify
the channel strategy used by Apple and its channel members as direct or
indirect.
Chapter 15 - Managing Marketing Channels and Supply Chains
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Answers:
Chapter 15 - Managing Marketing Channels and Supply Chains
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ICA 12-2: IN-CLASS ACTIVITY
Marketing Channels for Fastenal1
Learning Objectives. To have students identify: (1) the points of difference, (2) target
market segments, and (3) marketing channels that might be used for a category of unique
threaded fasteners distributed by Fastenal Company.
Nature of the Activity. To help students understand the unique nature of the threaded
fastener products (points of difference) and their applications and target markets so students can
suggest the appropriate marketing channel(s).
Estimated Class Time and Teaching Suggestions. About 10 minutes.
Steps to Teach this ICA.
2. Give students the following mini-lecture on threaded fasteners:
“The term ‘threaded fasteners’ is just a name for screws, bolts, and related items used
3. Give students the following mini-lecture on Fastenal’s unique threaded fasteners:
“There are common fasteners, like the ones any of us can buy at a hardware store like
Ace or a home improvement store like Home Depot, and use in everyday
Chapter 15 - Managing Marketing Channels and Supply Chains
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4. Next ask students the following questions about fasteners:
• Question 1: What is the main point of difference for these fasteners?
• Question 2: Where are these fasteners most likely to be needed?
• Question 3: What kinds of organizations are most likely to buy them?
• Question 4: Where would industrial customers purchase these fasteners?
• Question 5: What are the problems or challenges facing the company who
wants to reach these special customers? What will it take to reach these
customers and why should Fastenal do it?
5. Customers that use these special threaded fasteners look to two common marketing
channels for business products, as shown in Figure 12-4:
12-41
Exercise 1: Vertical Marketing Systems at Starbucks
Tagging (Topic, Learning Objectives, AACSB, Bloom’s, Difficulty)
Topics: Marketing Channels, Vertical Marketing Systems
Learning Objective: LO 12-02 Distinguish among traditional marketing channels, electronic
marketing channels, and different types of vertical marketing systems.
AACSB: Knowledge Application
Blooms: Remember
Difficulty Level: 1 Easy
Exercise 2: Marketing Channel Functions at Home Depot
Activity Summary: In this click and drag activity, students evaluate the functions performed by
intermediaries. Students are provided with the major activities related to the intermediary
Tagging (Topic, Learning Objectives, AACSB, Bloom’s, Difficulty)
Topic: Channel Management
Learning Objective: LO 12-01 Explain what is meant by a marketing channel of distribution
and why intermediaries are needed.
AACSB: Knowledge Application
Blooms: Apply
Difficulty Level: 2 Medium
Exercise 3: Total Logistics Cost Factors
Activity Summary: In this click and drag activity, students learn about the logistics costs factors
Chapter 15 - Managing Marketing Channels and Supply Chains
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Tagging (Topic, Learning Objectives, AACSB, Bloom’s, Difficulty)
Topic: Logistics
Learning Objective: LO 12-04 Explain what supply chain and logistics management are and
how they relate to marketing strategy.
AACSB: Knowledge Application
Blooms: Apply
Difficulty Level: 2 Medium
Exercise 4: Amazon: Delivering the Goods... Millions of Times
Activity Summary: In this 8-minute news-documentary style video case, students learn about
Tagging (Topic, Learning Objectives, AACSB, Bloom’s, Difficulty)
Topics: Electronic Marketing Channels, Logistics, Consumer Needs and Wants, Marketing
Channels
Learning Objectives: LO 12-01 Explain what is meant by a marketing channel of distribution
and why intermediaries are needed.
Exercise 5: iSeeit! Video Case: Supply Chain
Chapter 15 - Managing Marketing Channels and Supply Chains
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Tagging (Topic, Learning Objectives, AACSB, Bloom’s, Difficulty)
Topics: Logistics, Wholesaling, Supply Chain Management
Learning Objectives: LO 12-01 Explain what is meant by a marketing channel of distribution
and why intermediaries are needed.
LO 12-04 Explain what supply chain and logistics management are and
how they relate to marketing strategy.
AACSB: Knowledge Application
Blooms: Apply
Exercise 6: Target Market Coverage: Distribution Density
Activity Summary: In this click and drag activity, students learn about distribution density. The
Tagging (Topic, Learning Objectives, AACSB, Bloom’s, Difficulty)
Topic: Levels of Distribution Density
Learning Objectives: LO 12-03 Describe factors that marketing executives consider when
selecting and managing a marketing channel, including legal restrictions.
AACSB: Analytical Thinking
Blooms: Analyze
Difficulty Level: 2 Medium
Marketing Analytics Exercise: Channel Sales and Profits
Activity Summary: In this analytics exercise, students analyze the distribution strategy for a
company that manufactures a digital personal assistant similar to the Amazon Echo. Currently,
Chapter 15 - Managing Marketing Channels and Supply Chains
Tagging (Topic, Learning Objectives, AACSB, Bloom’s, Difficulty)
Topic: Marketing Analytics
Learning Objectives: LO 12-03 Describe factors that marketing executives consider when
selecting and managing a marketing channel, including legal restrictions.
AACSB: Analytical Thinking
Blooms: Analyze
Difficulty Level: 3 Hard
Follow-Up Activity: Instructors could use the spreadsheet as a launching point for a discussion
about the importance and value of intermediaries. The goal of the discussion would be to have
students understand why manufacturers use different types of intermediaries to reach buyers.
