The three types of vertical marketing systems are contractual, corporate and Administered.
an organised, structured and unified distribution channel system in which producer and intermediaries or middlemen (wholesalers and retailers) work closely together to facilitate the smooth flow of goods and services from producer to end-user.
VMS Types . There are three major types of VMS: corporate, administered and contractual .
Contractual Vertical Marketing This system allows companies to benefit from economies of scale and marketing reach. These relationships are a popular form of vertical marketing . Franchising , retail sponsored and wholesale sponsored are forms of a contractual vertical marketing system .
Contractual VMS is a channel system formed by individual firms operating as different channel players, integrating their operations on contractual basis. This helps each of the players to achieve economies of scale by integrating their operations.
How do marketing channel members use data warehouses to make decisions ? through EDI (Electronic Data Exchange) large quantities of data are stored and can be examined to show trends and patterns in the consumers preferences.
Broad examples of vertical markets are insurance, real estate, banking, heavy manufacturing, retail, transportation, hospitals and government.
A vertical line is any line parallel to the vertical direction. A horizontal line is any line normal to a vertical line. Horizontal lines do not cross each other. Vertical lines do not cross each other.
A vertical market is one in which all of your customers are in one particular industry, regardless of where in the food chain they are. A horizontal market is one in which all of your customers use your product to do the same thing, regardless of what industry they are in.
There are basically 4 types of marketing channels : direct selling; selling through intermediaries; dual distribution ; and reverse channels .
When professionals talk about industries , they are referring to a broad group of companies that operate in the same general space. An industry vertical , however, is more specific and describes a group of companies that focus on a shared niche or specialized market spanning multiple industries .
“The main advantage of VMS is that your company can control all of the elements of producing and selling a product. In this way, you are able to see the whole picture, anticipate problems, make changes as they become necessary, and thus increase your efficiency .
While members of a conventional distribution channel seek to maximize their own profits, members of a vertical marketing system all cooperate because either one member owns the others, one has contracts with the others, or one wields more power than the others.
The process of selling directly to the end buyer without any intermediary is called direct marketing channel . The internet and new media are perfect for direct marketing . For example the business model followed by low cost airlines where the customers book the tickets directly over the internet.
Multichannel marketing refers to the practice of interacting with customers using a combination of indirect and direct communication channels – websites, retail stores, mail order catalogs, direct mail, email, mobile, etc. –