A C T A U N I V E R S I T A T I S L O D Z I E N S I S Г01. IA OECONOMICA 83, 19Й8 _________
Hubertus M ü lle r *
VERTICAL MARKETING MANAGEMENT IN MARKETING CHANNELS ( C o n f l i c t and Power Problem s)
I . I n t r o d u c t ion
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The p r o d u c e r - t r a d e r * r e l a t i o n s , e s p e c i a l l y those of the con- sumer-goods in d u s t r y in F e d e r a l R e p u b lic of Germany, have r e c e n t l y changed and have i n c r e a s i n g l y become s u b j e c t of c o n t r o v e r s i e s in c o m p e t it iv e p o l i c y , but a ls o in economy, e s p e c i a l l y in the
marke-2 t i n g s e c t o r .
S t a g n a t in g and i n c r e a s i n g l y s a t u r a t e d m arkets, as w e l l as the change from a s e l l e r ' s to a b u y e r ' s market are the reasons f o r the f a c t , t h a t the c o m p e t itio n between prod uc ers arid t r a d e r s f o r mar ket s h a res perm anently i n t e n s i f i e s .
A lso the c o n f l i c t p o t e n t i a l in the m ark eting c h a n n e ls , esp e c i a l l y f o r the p r o d u c e r s , has grown c o n s i d e r a b l y , because o f the p r o g r e s s in g em a n cip a tio n of t r a d e m ark eting and the f a c t , t h a t t h e i r brand p o l i c y becomes more and more independent ( t h e t r a d e r s have changed t h e i r r o l e from a p a s s i v e agent i n t o the gate-keep er p o s i t i o n in the m a rk etin g c h a n n e l ) 5 on the one hand and because
* M . E c . , s e n i o r a s s i s t a n t , J u s t u s - L í e b i g - U n i v e r s i ty in G ie sse n ( F e d e r a l R e p u b lic o f Germany).
1 Trader means: the w h o le s a le r s and r e t a i l e r s t o g e t h e r .
2 H.H. B a u e r , H e r s t e lle r - H a n d e ls - B e z ie h u n g e n im Wandel, auf dem Weg zu e i n e r dualen M a r k e t in g - F ü h r e r s c h a f t im A b s a tz k a n a l, " M a r k e n a r t i k e l " 1982, H. 10, p. 428-4J6.
3 Ibidem, p. 428.
of the i n c r e a s i n g c o n c e n t r a t i o n p ro c e ss of the t r a d e r s on the a
o t h e r hand .
A c t u a l l y , the o r i g i n a l d i s t r i b u t i o n of power between p rod uc ers and t r a d e r s ( v e r t i c a l power s t r u c t u r e ) began to change and the t r a d e r s become more and more the dominant (more p o w e r f u l ) element in the m ark eting c h a n n e l, e s p e c i a l l y in the consuroer-goods in d u s t r y of the FRG’’ . T h e r e fo r e , many p rod uc ers a re c o n fro n te d w ith s e r i o u s problems in j u s t i f y i n g and e n f o r c i n g t h e i r v e r t i c a l marketing p o l i c y a g a i n s t t r a d e r s , because of the a l t e r e d pow er-balance in the m arketing c h an n e ls the t r a d e r s a re o n ly l i t t l e i n t e r e s t e d in c o o p e r a t in g w it h the p r o d u c e r s , e s p e c i a l l y as a r e s u l t o f t h e i r i n c r e a s i n g demand power.
The form er "do m in a tin g p o s i t i o n " , m ainly of the brand-good p ro d u c e rs in the m ark eting channel i s d e c r e a s in g more and more, and new dom inating p o s i t i o n s a re b u i l t - u p , e s p e c i a l l y by l a r g e c h a i n s in the food r e t a i l t r a d e such as f o r i n s t a n c e , A L D I , COOP, TENGELMMIN, EQEKA and REWE. So you can say many p rod uc er marks a re d i s p l a c e d by t r a d e marks, which become more and more im portant in the m arket.
T h e r e fo r e , the q u e s ti o n a r i s e s , how f a r the p ro d u c e rs a re able now to r e a l i z e t h e i r v e r t i c a l m a rk eting management p o l i c y , because o f the a l t e r e d power s t r u c t u r e s in the m ark eting c h a n n e l s , and whether t r a d e r s the m se lve s are not going to be a dominant element of v e r t i c a l m a rk eting a c t i v i t i e s in the f u t u r e ? To a n a ly s e t h i s q u e s ti o n f o r the f o o d s t u f f s e c t o r o f the FRG and to f i n d , a t l e a s t p a r t l y , an answer to t h i s q u e s ti o n w i l l be o b j e c t o f t h i s a n a l y s i s . To do t h i s , i t i s , f i r s t , n e c e s s a r y to d e f i n e some im p orta n t b a s i c term s, in o r d e r to be ab le to d i s c u s s t o p i c a l c o n f l i c t arid power f i e l d s between p ro d u c ers and t r a d e r s a f t e r w a r d s .
Hot e v e ry s i n g l e power and c o n f l i c t f i e l d named under No. 3 in the c o n t e n ts w i l l be e x p la in e d and a n a ly s e d in a l l d e t a i l , but I
д
H. S t e f f e n h a g e n , K o n f l i k t und K o o p e ra tio n in der . r k e n p o l i t i k aus w i s s e n s c h a f t l i c h e r S i c h t , " M a r k e n a r t i k e l " 1983, !. 3, p. 92-95j G. R ü s c h e n , Nie s t e l l t s i c h d i e Marken- a r t i k e l i n d u s t r i e auf d i e H a n d e ls k o n z e n tr a ti o n e i n ? , " M a r k e n a r t i k e l " 1984, H. 3, p. 108-116.
J W. K a r t t e, A k t u e l l e Probleme des Wettbewerbs in der K o n s u m g u t e r w ir ts c h a ft , " M a r k e n a r t i k e l " 1984, H. 5, p. 232-238.
w i l l p ic k out the most im portant problem s e c t o r s and e x p l a i n them w it h examples.
The mam p o i n t s in the f o l l o w i n g a n a l y s i s w i l l be the c o n f l i c t and power f i e l d s "p ro d u c t and a ssortm ent p o l i c y , p r i c e p o l i c y and c o n t r a c t p o l i c y " , b ecause, f i r s t l y , these are the c e n t r a l o rg a n
i z a t i o n s e c t o r s of v e r t i c a l m arketing management and, s e c o n d l y , these o r g a n i z a t i o n f i e l d s are an o b j e c t of power s t r u g g l e s in p r a c t i c e a t the moment. j
2 .1 . Term, Tasks arid Types of V e r t i c a l M arke ting Management As you c e r t a i n l y know, in the l i t e r a t u r e th e re are a l o t of p o s s i b i l i t i e s of d e f i n i n g the term " v e r t i c a l m arketing management". I w i l l u nderstand the f o l l o w i n g by t h i s term:
" V e r t i c a l m a rk eting management i s the s y s t e m a t i c a l , o b j e c t i v e - - o r i e n t a t e d c o o r d i n a t i o n of a l l m arketing a c t i v i t i e s a c ro s s d i f f e r e n t d i s t r i b u t i o n l e v e l s " .
Th is d e f i n i t i o n i s p u r p o s e f u l l y a v e ry " w i d e " one and does not s t a t e f o r the moment, who i s the dominant element of the marke t i n g a c t i v i t i e s in the m ark eting c h a n n e l. Apart from t h a t i t con t r a d i c t s the o p i n i o n , you can o f t e n f i n d in the l i t e r a t u r e , t h a t the terms " v e r t i c a l m arketing management" and " v e r t i c a l m ark eting c o o p e r a t i o n " a re synonyms6 .
However, I t h in k t h a t e q u a tin g one term w ith the o th e r does not seem to be c o r r e c t , as in v e r t i c a l m ark eting management the market p a r t n e r s , u n l i k e i t i s the case w it h the m a rk etin g coope r a t i o n , u s u a l l y do not work to g e th e r as e q u a l s . In v e r t i c a l marke t i n g management r a t h e r one element ( u n t i l now i t was the p r o d u c e r ) i s the d om inating element in the m a rk eting channel and in most c a s e s i t a l s o ta k e s o ve r the m a r k e t in g - le a d e r s h ip . As the balances of power, however, have been changed, t h e r e f o r e , the d e f i n i t i o n ot v e r t i c a l m ark eting management was not l i m i t e d to the p roducer o n ly .
6 G. T h i e s , V e r t i k a l e s M a r k e t in g , B e r lin - N e w York 1976, p. 52.
7 H. S t e f f e n h a g e n , M a r k e t in g , v e r t i k a l e s , [ i n . ] M a r k e tin g E n z y k lo p ä d ie , Bd. 2, München 1974, p. 675-690;8 a u e r , o p . c i t . , p . 430.
The task of v e r t i c a l m arketing management i s to p l a n , c o o r d i n a te and i n t e g r a t e c e n t r a l l y e v e ry m arketing a c t i v i t y a c r o s s a l l the d i f f e r e n t d i s t r i b u t i o n l e v e l s in the m arketing channel with the aim:
1) to i n c r e a s e the p r o f i t or d e c re a s e the c o s t s and
2) to ma1<e an e f f i c i e n t d i s t r i b u t i o n of d u t i e s p o s s i b l e between the market p a r t n e r s , th u s, a v o id i n g d u p l i c a t i o n of m ark eting a c t i v i t i e s 0 .
The v e r t i c a l m ark eting management appears in many d i f f e r e n t typ e s in p r a c t i c e . So in t h i s paper o n ly a few c l a s s i f i c a t i o n c r i t e r i a f o r d i f f e r e n t i a t i n g d i f f e r e n t typ e s of v e r t i c a l m ark eting management can be p o in te d o u t. The f o l l o w i n g F i g . 1 g i v e s you a
9 ' ,
s h o r t survey
2 .2 . D e f i n i t i o n and D i f f e r e n t i a t i on of the Term " C o n f l i c t "
AftP*- having s h o r t l y e x p la in e d the term, ta s k s and typ e s of v e r t i c a l m arketing management I now want to d e f i n e the term " c o n f l i c t " , which should be used in the f u r t h e r d i s c u s s i o n . Here a g a i n , s i m i l a r to the term of v e r t i c a l m arketing management, we a re c o n f ro n t e d w ith c o n s i d e r a b l e d i f f i c u l t i e s in d e f i n i n g i t be cause the term " c o n f l i c t " has many d i f f e r e n t meanings in the so c i a l s c ie n c e s and in the b e h a v i o u r - o r i e n t a t e d s c i e n c e of b u sin e ss a d m i n i s t r a t i o n .
" I n the f o l l o w i n g a n a l y s i s c o n f l i c t s are to be d e fin e d as ^con t r a r i e t i e s between market p a r t n e r s , which have the e f f e c t o f i n c o m p a tib le p a t t e r n s of b e h a v io u r between the i n t e r a c t i o n p a r t i c i p a n t s 10.
As " c o n f l i c t " I have a l s o chosen a term, which i s v e ry " w i d e l y " d e fin e d and which d o e s n 't p r e v e n t you from s e e in g a l l the d i f f e r e n t causes and typ e s of c o n f l i c t such a s , f o r i n s t a n c e , goal- - s e t t i n g - c o n f 1 l e t s or e v a l u a t i o n - c o n f l i c t s in the m a rk eting '
chan-8 S t e f f e n h a g e n , M a r k e t i n g . . . , p. 675. 9 T h i e s , op. c i t . , p. 53. 1
i 0 W. K r o e b e r - R i e l , P. W e i n b e r g , K o n f l i k t e in Absatzwegen a l s F o lg e i n k o n s i s t e n t e r P r ä f e re n z e n von H e r s t e l l e r n und H ä n d le rn , " Z e i t s c h r i f t f ü r B e t r i e b s w i r t s c h a f t " 1972, H. 3, p. 525-544. R.M. M a a s Absatzwege, Konzeptionen und M o d e lle ,
Wiesbaden 1980, p. 111.
C l a s s i f i c a t i o n c r i t e r i a Types of v e r t i c a l m arketing management
1. C o o r d in a tio n i n i t i a t i v e — forw ard c o o r d i n a t i o n (p r o d u c e r ) — backward c o o r d i n a t i o n ( t r a d e r ) — one l e v e l c o o r d i n a t i o n ( i n c l u des' o n ly one m ark eting l e v e l ) and - d i r e c t i o n
2. C o o r d in a tio n s t r u c t u r e
__ two or more l e v e l c o o r d i n a t i o n ( i n c l u d e s two or more m arketing l e v e l s )
3. C o o r d in a tio n e x te n t
and - i n t e n s i t y — p a r t i c a l c o o r d i n a t i o n (in clu des 3.1 . Number and impor l e s s market p a r t n e r s )
tance of the
co-o r d i n j t i co-o n partners — t o t a l c o o r d i n a t i o n ( i n c l u d e s a l l market p a r t n e r s )
3 .2 . Number and impor — p a r t l y f u n c t i o n a l c o o r d i n a t i o n tance of the c o ( o n l y s p e c i a l m arketing f i e l d s ) o r d i n a t i o n f i e l d s — t o t a l f u n c t i o n a l c o o r d i n a t i o n ( a l l m arketing f i e l d s ) — temporary c o o r d i n a t i o n (tim e 3.3 . C o o r d in a tio n le n g th l i m i t e d ) — permanent c o o r d i n a t i o n ( t im e not l i m i t e d )
F i g . 1. P o s s i b l e types of v e r t i c a l m arketing management in m ark eting c h an n e ls
n e l 11. This method of p r o c e e d in g , e s p e c i a l l y in reg a rd to the f o l low ing e x p la n a t io n of t o p i c a l f i e l d s of c o n f l i c t and power seems a p p r o p r i a t e , as in p r a c t i c e t h e r e i s a g r e a t v a r i e t y of d i f f e r e n t c o n f l i c t s i t u a t i o n s .
Fu rth e rm o re , the in te rd e p e n d a n t c o n te x t between c o n f l i c t and power problems becomes a l r e a d y c l e a r by t h i s d e f i n i t i o n of c o n f l i c t , as power i s one p o s s i b l e type of in c o m p a tib le b e h a v io u r , by which c o n f l i c t s can be s o lv e d . But t h i s c o n te x t w i l l be e x p la in e d l a t e r on.
S t e f f e n h a g e n , K o n f l i k t und K o o p e ra tio n in der M a r k e n p o l i t i k . . . , p. 93.
2 .3 . D e f i n i t i o n and D i f f e r e n t i a t i o n o f the Term ''Power"
F i n a l l y , I want to d e f i n e the term "pow er" more e x a c t l y . I t seems s u i t a b l e to choose a d e f i n i t i o n t h a t i s o p e r a t i o n a l in regard to the o b j e c t i v e .
"Power should be understood as the p o s s i b i l i t y to i n f l u e n c e the a c t i v i t y and/or d e c i s i o n f i e l d s of o t h e r market p a r t n e r s
con-12 t r a r y to t h e i r o b j e c t i v e s "
Th is power d e f i n i t i o n i s based upon the " r e l a t i o n a l power con c e p t " , which presumes t h a t power w i l l o n ly e x i s t w i t h i n i n t e r a c t i o n r e l a t i o n s , and t h a t power p ro c e s s e s are alw ays t a r g e t - o r l e n - t a t e d . Furthermore^ i t becomes c l e a r t h a t the term "power" i s c o n f l i c t o r i e n t a t e d , because power i s alw ays used c o n t r a r y to the o b j e c t i v e s of o t h e r s .
Th is d e f i n i t i o n a l s o shows the c l o s e c o n te x t between c o n f l i c t and power problem s, which I w i l l e x p l a i n in the f o l l o w i n g p a r a g raph.
2^4. The I n t e r dependant Context B e tween C o n f l i c t and Power Problems
As i t has a l r e a d y been p o in t e d o u t, t h e r e i s an in te rd e p e n d e n t c o n t e x t between c o n f l i c t and power problem s. T h is i s , f o r i n s t a n c e , con firm e d by the f a c t t h a t the c o n f l i c t p o t e n t i a l in the m arketing c h a n n e ls has been in c r e a s e d , because o f the growing demand power o f the t r a d e r s , and because of changes in the b a la n c e of power. The power changes which a re c h a r a c t e r i z e d by the f a c t t h a t t r a d e r s a re more and more a b le to make t h e i r own m a rk eting p o l i c y ( a g a i n s t the aims c f the p r o d u c e r s ) have the e f f e c t t h a t the s i z e o f c o n f l i c t as w e l l as the i n t e n s i t y o f c o n f l i c t have c o n s i d e r a b l y 'in c r e a s e d i n the m arketing c h a n n e ls .
Fu rth e rm o re , the i n c r e a s i n g demand power a l l o w s t r a d e r s to s o l v e the s o - c a l l e d " l a t e n t c o n f l i c t s " w it h the p r o d u c e r s , which means t h a t power I s a l s o used as an in stru m en t to s o l v e c o n f l i c t s 13, whereby u s u a l l y " l a t e n t c o n f l i c t s " become " m a n if e s t c o n f l i c t s " ' 4
12 M. W e b e r , W i r t s c h a f t und G e s e l l s c h a f t , Tubingen 1956; H. S t e f f e n h a g e n , K o n f l i k t und K o o p e ra tio n in A b s a tz k a n ä le n , Wiesbaden 1975.
13 M a a s , op. c i t . , p. 122.
** S t e f f e n h a g e n , K o n f l i k t und K o o p e ra tio n ln Absatz k a n ä le n . . . , p . 24 .
So we can say:
1) c o n f l i c t s can a r i s e or in c r e a s e by the use ot power and 2) c o n f l i c t s can be s o lv e d by the use of power.
R e s u l t : t h i s means t h a t c o n f l i c t s may be the cause as w e l l as the consequence of power p r o c e s s e s .
This in te rd e p e n d e n t r e l a t i o n a l c o n te x t between c o n f l i c t and power problems can be e x p la in e d more c l e a r l y by the f o l l o w i n g F i g . 2.
F i g . 2. The in te r d e p e n d a n t r e l a t i o n a l c o n te x t between c o n f l i c t and power problems
*í
3. T o p ic a l C o n f l i c t and Power F i e l d s W i t h i n the Scope of V e r t i c a l M a rk e tin g Management
As I have a l r e a d y p o in t e d o u t , I c a n ' t d is c u s s here a l l the r e l e v a n t c o n f l i c t and power f i e l d s of the v e r t i c a l m a rk eting mana gement. T h e r e f o r e , going to speak o n ly about those problems, which are at the moment the most t o p i c a l ones, such as “ p rod uc t and assortm ent p o l i c y , p r i c e p o l i c y and c o n t r a c t p o l i c y " . But for the sake of c o m p le ten e ss , I want to show you a l l the r e l e v a n t p o t e n t i a l c o n f l i c t and power f i e l d s in a f i g u r e ^ . As you can see from the f o l l o w i n g t a b l e the a s p e c t of d i f f e r e n t ’ c o o r d i n a t i o n f i e l d s " ( o f p o i n t 3.2 in F i g . 1) i s the dominant d i f f e r e n t i a t i o n c r i t e r i o n h e re .
F i r s t of a l l , I want to d is c u s s the c o n f l i c t and power f i e l d "p r o d u c t and a ssortm ent p o l i c y " .
>.1. P r o duct and Asso r t ment P o l i c y
In the f i e l d o f p roduct and assortm ent p o l i c y , changes in the b a la n c e of power between p rod uc ers and t r a d e r s become most evident when we take the example of branded goods. Branded goods, which a re marked a r t i c l e w it h a c o n s ta n t p roduct q u a l i t y and a c e r t a i n p r i c e l e v e l , used to be the undoubted domain of the p ro d u c e rs. For some time now tra d e marks, e s p e c i a l l y "no-names'1, as f o r i n s t a n c e , the " J a ! " - p ro d u c ts of REWE, the " A l t e r n a t i v e n " of EDEKA end the "W e is s e n " of the Hl.-markets get more and more im portance in the f o o d s t u f f market.
The development of the t r a d e r s 'o w n tra d e marks and "no-name" p r o d u c ts , which a re qui-te comparable in q u a l i t y w ith the brand goods of the p ro d ú c e rs , i s a s i g n , t h e r e f o r e , t h a t the t r a d e r s a re i n c r e a s i n g l y becoming more a c t i v e in the product development s e c t o r and c o n f r o n t the consumer more and more w it h t h e i r own mar k e t i n g c o n c e p ti o n s .
The f i g u r e s in the annual b u sin e ss r e p o r t of R E W E 'f o r 1982, f o r i n s t a n c e , c o n firm t h i s development. The " J a ! " - assortm ent of REWE, which was in tro d u c e d in 1982, c o n ta in e d a t t h a t time about 50 p r o d u c t s . S p e c i a l a d v e r t i s i n g campaigns and s a l e s promotions were made f o r t h i s p roduct group w it h the aim to p r o f i l e the RE WE chain in the market and to in c r e a s e t h e i r c o n t r i b u t i o n margins in the d i f f i c u l t f o o d s t u f f s e c t o r . Thus, f o r example, the " j a k o r d i a " - p r o d u c ts , which had been in tr o d u c e d in the tobacco p rod uc t s e c t o r , made a s u r p lu s in tu r n o v e r from about 35% in the f i r s t y e a r 16.
S i m i l a r t re n d s can be a l s o seen In the o t h e r p rod u c ts o f the " J a ! " - a s so rtm e n t. F u rth e rm o re , I t I s c h a r a c t e r i s t i c t h a t some "no-names" of o th e r l a r g e t r a d e e n t e r p r i s e s In the f o o d s t u f f s e c t o r reach ed q u a n t i t i e s up to 60% and more i n s p e c i a l p roduct дгоирз17.
T h e r e f o r e , i t i s a j u s t i f i e d assumption t h a t e s p e c i a l l y the f o o d s t u f f r e t a i l t ra d e p r i c e d more and more the t r a d i t i o n a l p r o ducer marks out of the market w ith such a r a p i d growth r a t e of i t s t r a d e marks and "no-name" p r o d u c ts . In my o p in io n i n c r e a s i n g
16 Rewe - G e s c h ä f t s b e r i c h t von 1982.
1 L . b e r e k o v e n , No-names, Versuch e i n e r S ta n d o r t- b e st lmr.ung, " M a r k e n a r t i k e l " 1983 , H. 5, p. 180-184.
P o t e n t i a l c o n f l i c t and power f i e l d s in the scope of v e r t i c a l m ark eting management
C o n f l i c t and power f i e l d s Market p a r t n e r s Producer Trader P ro d u c t and a s s o r t ment p o l i c y : pro d u c t development
pro d u c t program and asso rtm en t d e v e l o p ment P r i c e p o l i c y I n f o r m a t i o n and coraoiuniciiiion po l i c y . market r e s e a r c h a d v e r t i s i n g s a l e s promotion s a l e D i s t r i b u t i o n p o l i c y : s to c k k e e p in g
development and e n for- cemenent of producer- -products arid -brands b u ild in g - u p a product- and brand-image permanent p rod uc t i n n o v a tio n c o n t i n u a l , w ith p r i c e recommendations sup p o rted p r i c e p o l i c y
p roduct and brand r e l a t e d s e a rc h and s e l e c t i o n of in fo r m a tio n o v e r - r e g i o n a l p roduct a d v e r t i s i n g c r e a t i o n of product r e f e r e n c e s and b u i l ding-up brand l o y a l t y p rod uc t r e l a t e d s a l e s promotion p roduct r e l a t e d s a l e s r e p r e s e n t a t i o n f a v o u r a b le placement of producer p rod u c ts c o n t i n u a l s a l e w ith la r g e o r d e rs and l i t t l e s to c k - k e ep in g
development and enfor- cemenent of t r a d e r - -p roducts and -brands b u ild in g - u p an a s s o r t ment - and s a l e s agen- cy-image o n ly o c c a s i o n a l p r o duct in n o v a t i o n , con s ta n c y w it h p rod u c ts of s tro n g t u r n o v e r h ig h - p re s s u re p r i c e p o l i c y ( f o r in s t a n c e under c o s t s e l l i n g )
assortm ent and s a l e s agency r e l a t e d s e a rc h and s e l e c t i o n of i n fo rm a tio n
r e g i o n a l assortm ent and s a l e s agency adver t i s i n g c r e a t i o n of assortm ent p r e f e r e n c e s and i b u i l ding-up d e a l e r l o y a l t y assortm ent r e l a t e d s a l e s promotion
more a ssortm ent r e l a ted s a l e s r e p r e s e n t a t i o n f a v o u r a b l e placement of t r a d e r p ro d u c ts and i n t e g r a t i o n of the pro ducer p ro d u c ts i n t o the t r a d e assortm ent
demand o r i e n t a t e d quan t i t i e s ord ered w ith s h o r t t im e of d e l i v e r y and l i t t l e stockkeeping
Table 1 ( c o n t d ) t r a n s p o r t C o n tr a c t p o l i c y discou n ts c o n d i t i o n s high d i s t r i b u t i o n i n t e n s i t y w ith s e l f - d e l i v e r y by tra d e a p p r o p r i a t e ( j u s t i f i e d ) tra d e m argins, d is c o u n t s and p r o v i s io n s o b j e c t i v e l y j u s t i f i e d a d d i t i o n a l s e r v i c e s as f o r in s t a n c e a d v e r t i s in g and s a l e s promo t i o n a s s i s t a n c e e t c . s e l e c t i v e and e x l u s i v e d i s t r i b u t i o n w it h de l i v e r y by the producer
high tra d e m argins, d is c o u n t s and p r o v i s io n s a d d i t i o n a l s e r v i c e s as f o r i n s t a n c e e n t r e e f e e s , placement f e e s , s p e c i a l d is c o u n t s fo r
the opening of new s t o r e s e t c .
power c o n f l i c t s seemed to be u n a v o id a b le in the sphere of p roduct and assortm ent p o l i c y . F u rth e rm o re , I assume - t h a t I t becomes more an* more d i f f i c u l t f o r the p rod uc ers to r e a l i z e t h e i r own m arketing management s t r a t e g i e s in t h i s s e c t o r .
As the second t o p i c a l c o n f l i c t and power f i e l d I want to d i s cuss the s e c t o r of ".o ric e p o l i c y " .
3 .2 . P r i ce P o l I c y
R e c e n t l y in t h i s s e c t o r Wiere tiave been f i e r c e c o n f l i c t s b e t ween p rod uc ers ar.d t r a d e r s , which u l t i m a t e l y le a d to ат I n t e r v e n t i o n of the F e d e r a l A n t i - T r u s t Board as the supreme g u a rd ia n of c o m p e t itio n p o l i c y .
The c o n f l i c t a r o s e , because t r a d e r s l i k e COOP i n the r e g io n near Bremen s o ld well-known producer branded a r t i c l e s , such as, f o r i n s t a n c e , "Asbach u r a l t “ аь " b a i t " , t h a t means under t h e i r c o s t p r i c e . They cou ld do t h i s , because of t h e i r enormous p u rc h a s in g power and because of t h e i r mixed c a l u c u l a t i o n s .
On the s id e of the p r o d u c e r s , t h e r e were vehement p r o t e s t s a g a i n s t these a c t i o n s supported above a l l w it h the argument th a t t h e re might be long-term m a rk eting l o s s e s in the r e p u t a t i o n and s a l e of t h e i r branded a r t i c l e s . Th is would m ainly be caused by the f a c t t h a t the " u n d e r - p r ic e s e l l i n g " of branded a r t i c l e s in such a way would d e t t r o y the con sum er's c o n f i d e n c e , because they would
a s s o c i a t e the d e c l i n e in p r i c e s w it h i n f e r i o r p roduct qua l i t y 10.
T r a d e r s , at f i r s t , remained unimpressed and p o in te d out t h a t under c o s t p r i c e s e l l i n g of brand goods i s a l e g a l s e l l i n g s t r a
tegy in c o m p e t itio n and showed bn ly the extreme e f f i c i e n c y of trade e n t e r p r i s e s doing t h i s . Then the F e d e r a l A n t i - T r u s t Board i n t e r vened in t h i s c o n f l i c t and forebade the REWE-group in the reg io n n ear Bremen to s e l l p roducer branded a r t i c l e s uncjer t h e i r c o s t p r i c e in accordance w it h § 37a, l i n e 3 of the law a g a i n s t u n f a i r c o m p e t itio n (G W B)19.
However, the A n t i - T r u s t Board e x p r e s s l y p o in te d out t h a t , gen e r a l l y , the s a l e under c o s t p r i c e i s l e g a l and t h a t § 37a, l i n e 3 GWB can o n ly be a p p l i e d i f tra d e e n t e r p r i s e s owing to t h e i r s u p e r
io r market power a re a b le to s e l l p ro d u c ts s y s t e m a t i c a l l y and con t i n u a l l y under t h e i r c o s t p r i c e w ith the aim to oust c o m p e t ito rs from the market or even to d e s t r o y them.
F u rth e rm o re , the chairman of the F e d e r a l A n t i - T r u s t Board KARTTE arranged in October 1983 a meeting between le a d in g r e p r e s e n t a t i v e s of p roducer and t r a d e e n t e r p r i s e s , at which the so- - c a l l e d "common d e c l a r a t i o n to p r o t e c t the e f f i c i e n c y c o n t e s t and c o m p e t i t i o n " ( a l s o c a l l e d the "solemn promise of B e r l i n " ) was sig ned s t i p u l a t i n g t h a t in the f u t u r e th e re w i l l be na s y s t e m a t i c a l under
2 0 c o s t p r i c e s e l l i n g o f prod uc er branded goods
T h is example, which i s r e p r e s e n t a t i v e f o r the p r i c e p o l i c y in m a rk eting c h a n n e ls , dem onstrates t h a t the power p o s i t i o n of the t r a d e r s has c o n s i d e r a b l y in r e a s e d and tfia t o n ly the i n t e r v e n t i o n of the s t a t e c o u ld p r e v e n t them from u sin g t h e i r t o t a l demand power w i t h i n the p r i c e p o l i c y . T h e r e f o r e , we can say tha t' a l r e a d y today the t r a d e r s in the f o o d s t u f f s e c t o r a re the dominant e l e ment of v e r t i c a l m a rk eting a c t i v i t i e s , e s p e c i a l l y in the p r i c e p o l i c y . (
As a f i n a l c o n f l i c t and power f i e l d between p ro d u c ers and trad e r s I now want to d i s c u s s the " c o n t r a c t p o l i c y " .
10 H . J . B u n t e , M it Anstand u n t e r E i n s t a n d , " A b s a t z w i r t s c h a f t " 19Ü3, H. 4, p. 56-59.
19 0 . V . , . k a r t e l l a m t u n t e r s a g t Coop V erk auf u n t e r E instand sp reis, " F r a n k f u r t e r A llg e m e in e Z e i t u n g " 19B3, H. 112, p. 13.
20 P. S p a r y , S ic h e r u n g des L e is t u n g s w e t tb e w e r s durch UWG- - N o v e l l i e r u n g , " M a r k e n a r t i k e l " 1904, H. 6, p. 3Ü6-308.
3 .3. C o n tr a c t P o l i c y
E s p e c i a l l y in the S L o p e o f c o n t r a c t p o l i c y , a number o f casus have been r e p o rte d r e c e n t l y which demonstrate how much the r e l a t i o n s between p rod uc ers and t r a d e r s have changed. They a l s o f u r t h e r support the t h e s i s of " t h e i n c r e a s i n g demand power of tra d e
21
e n t e r p r i s e s " *. A c h a r a c t e r i s t i c example i s the case of METRO. The F e d e r a l A n t i - T r u s t Board found out by i n v e s t i g a t i o n s th a t MFTR0 charged i t s f o o d s t u f f s u p p l i e r s w it h the s o - c a l l e d " e n t r e e f e e s " . The i n v e s t i g a t i o n s showed t h a t ML TWO, f o r i n s t a n c e , deman ded OM 500 f o r the a c c e p ta n c e of one new p rod uc t in t h e i r a s s o r t ment from 900 s u p p l i e r s . I t means t h a t w it h 40 MLTRO-markets and 22 i n t e g r a t e d PRIMUS- and MEISTER-markets they made 0M 31000 per p ro d u c t and s u p p l i e r and w it h 900 s u p p l i e r s t h a t amounts to about 0M 28 m i l l i o n . F u rth e rm o re , some s u p p l i e r s , moreover, had to o b l i g e them selves in a w r i t t e n form to take the goods back i f they did n t
22 rea ch a s a t i s f a c t o r y t u r n o v e r .
But the l i s t o f such i l l e g a l p r a c t i c e s by t r a d e r s c o u ld be extended much more, adding f o r in s t a n c e placement f e o s , r e p l a c e ment f e e s , f r e e d i s p l a y s and o t h e r s e r v i c e s , the r i g h t to r e t u r n Sjoods, i f these a r t i c l e s a re taken out o f the a s s o rtm e n t, e t c .
These examples show a g a in t h a t e s p e c i a l l y in the scope o f the c o n t r a c t p o l i c y the power and c o n f l i c t f i e l d s have not d im in i s h e d , but have in c re a s e d and i n t e n s i f i e d between p rod uc ers and t r a d e r s . I t a l s o shows t h a t the p ro d u c ers have ( a s a r e s u l t o f the market c o n s t e l l a t i o n ) h a r d l y any p o s s i b i l i t y to r e t a l i a t e or r e s i s t the t r a d e r s than to a pply to the F e d e r a l A n t i - T r u s t Board f o r h e l p , because the c o n c e n t r a t i o n and fu s io n p ro c e ss in the f o o d s t u f f
г'З
t r a d e has d r a m a t i c a l l y in c r e a s e d and i s s t i l l i n c r e a s i n g .
The F e d e r a l A n t i - T r u s t Board found out t h a t the f i v e l a r g e s t t r a d e c h a i n s in the FRG i . e . ALDI, COOP, (ENGELMANN, EDEKA and REWE account f o r about 65X o f the t o t a l t u rn o y e r in the f o o d s t u f f t r a d e . In s p i t e of t h i s enormous purchase p o t e n t i a l o f each tra d e c h a i n , d u rin g the l a s t two y e a r s t h e r e have been made endeavours aiming at l a r g e t r a d e e n t e r p r i s e s l i k e H ERTIE, KAUFHOF, WERTKAUF and MASSA to go t o p e th e r w it h the m id d l e - c l a s s s t r u c t u r e d buyin g agen-
— W. B e n i s с n, Wettbewerbsbeschränkungen in Konsum- j j u t e r a b s a t z , " M a r k e n a r t i k e l " 1984, H. 5, p. 240-246. 22 O . V . , K a r t e l l a m t . . , , p. 44. 2 J S p a r y , op. c i t . , p. 306.
c i e s SELEX, TANIA or ИКС and the tra d e c h a in s EOEKA and REWE to 24
promote "more f a v o u r a b le b u yin g "
T h is shows t h a t even la r g e branded good p roducers l i k e OETKER, NESTlE and UNILEVER have h a r d ly any p o s s i b i l i t y in t r a d in g w ith o th e r tra d e e n t e r p r i s e s , because sometimes 15* of t h e i r tu rn o v e r f a l l s upon one s i n g l e " t r a d e g i a n t " .
F i n a l l y , the f o l lo w in g la b . 2 once more shows the perm anently in c r e a s in g c o n c e n t r a t io n p roce ss and the demand power of the food s t u f f tra d e in the FRG, which i s r e l a t e d to t h a t .
T a b l e 2
P ow erfu l tra d e e n t e r p r i s e s in the consumer-goods s e c t o r of the FRG
0 E M A N 0 - U 1 A N T S
The 20 b ig g e s t tra d e e n t e r p r i s e s in the consumer-goods s e c t o r ( t u r n o v e r in M i l . DM)
1. A lb r e c h t 13 500
2. Selex/A 0 Handelsgruppe 13 160
3. Metro 12 000
4. Tangelm ann/K aistrs 11 378
5. Outílle / S c h ic k e d a n z 10 386 6. E d e k a - Z e n tra le 10 000 7. Rowe Leib b ra n d 9 500 8. K a r s t a d t 9 395 9. Coop 9 380 10. O tto Versand 8 300 11. K a u fh o f/ K a u f h a l l e 7 604 12. G e d e lf i 6 770 13. С A Bienntnkm ayer 6 420 14. H e r t i e 6 090 15. Ad olf Schaper 4 714 16. K a u f r i n g 4 201 17. K ipp-Gruppe (M a ss a ) 4 060 18. S u d f le i s c h / S u d v i e h 3 200 19. A l l k a u f 3 100 20. Hor len 2 940 S o u r c e : 0. V . , K a r t e l l a m t u n t e r s a g t Coop V e rk a uf u n te r E i n s t a n d s p r e i s , " F r a n k f u r t e r A llg em eine ľ e i t u n g " 1983, H. 112, p. 32. 4. C on clusion
I want to r e v e r t to the q u e s tio n 1 s t a r t e d o f f w it h , which asks f o r the dominant element o f v e r t i c a l m arketing management in the f o o d s t u f f s e c t o r of the FRG. As m a tte rs a r e , i t lo o k s as i f the p r e s e n t s t r a t e g i c a l s i t u a t i o n in the m arketing channel i s ch
c t e r i s e d by the f a c t th a t the p rod uc ers d e s p i t e having l a r g e mar k e t i n g e x p e rie n c e and competence in many c a ses are unable to en f o r c e t h e i r m ark eting management p o l i c y , because of the i n c r e a s i n g power d e f i c i t s and the r e s i s t a n c e of the t r a d e r s . However, i t seems t h a t in the p r e s e n t s i t u a t i o n t r a d e r s , a t l e a s t , in some m ark eting f i e l d s n e i t h e r have the competence to handle the marke
t i n g in stru m en ta riu m e x e l l e n t l y , лог have enough power to take over the v e r t i c a l m a rk eting management in . the sense of the
mar-25 k e t i n g l e a d e r s h i p in the channel
But the i n c r e a s i n g development and em an cip ation of the tra d e 26
m a rk etin g and a l s o the p r o g r e s s in g c o n c e n t r a t i o n p ro c e s s i n d i c a t e t h a t t r a d e r s in the n ear f u t u r e w i l l bu the dom inating e l e ment in most of the m a rk eting f i e l d s , at l e a s t , in the f o o d s t u f f s e c t o r of the FRG. Thus, i t i s to be expected u l t i m a t e l y t h a t th* r o l e of prod uc ers has changed g e n e r a l l y w it h branded goods ргооиг- e r s degraded to s u p p l i e r s f o r the l a r g e tra d e e n t e r p r i s e s , whicl tak e ove r a l l the t r a d i t i o n a l p roducer m ark eting a c t i v i t i e s am w it h them the l e a d e r s h i p in the m a rk eting c h a n n e l.
Hubertus M ü l l e r
PIONOWE ZARZĄDZANIE MARKETINGOWE W KANAŁACH RYNKOWYCH (problem k o n f l i k t u i s i ł y p r z e t a r g o w e j )
Pionowe z a rz ą d z a n ie marketingowe j e s t rozumiane ja k o system a ty c z n e i zo rien to w ane na c e l p r z e d s i ę b i o r s t w a koordynowanie d z i a ł a l n o ś c i m ark etingow ej podmiotów, z n a jd u ją c y c h s i ę na różnych po ziomach rynku. S i ł a p rzetargow a tyc h podmiotów, a także r e l a c j e zachodzące między nimi i s t o t n i e s i ę z m i e n i ł y . Handel s t a j e s i ę wiodącym u c z e s tn ik ie m k a n a łu rynkowego i zaczyna odgrywać dominu j ą c ą r o l ę w p r o c e s i e i n t e g r a c j i w a r t y k a l n e j . Równocześnie k o n f l i k t y między u c z e stn ik a m i ka n a łu rynkowego, wyw ołujące skło n n ość do sp rzecznych i c h zachowań, u l e g a j ą n a s i l e n i u . Wynika to w c z ę ś c i z w z r a s ta ją c e g o zn aczen ia handlu i zmian r e l a c j i między s i ł ą p r z e t a r gową poszczególnych ucze stników ka n a łu rynkowego.
P rz e d sta w io n o d z i e d z in y i p rzy c zy n y występowania n a j c z ę s t s z y c h k o n f l i k t ó w , p o d a ją c ic h t y p o l o g i ę z uwzględnieniem p rze ciw sta w n ych dążeń producentów i h an d lu . Na tym t l e , p rz y jm u ją c różne k r y t e r i a k l a s y f i k a c y j n e , wyróżniono 5 podstawowych typów z a rz ą d z a n ia mar k etingow ego.
Wykorzystano m a t e r i a ł empiryczny odnoszący s i ę do różnych form i n t e g r a c j i w e r t y k a l n e j między handlem a przemysłem w RFN.
25
B a u e r , op. c i t . , p. 433. 26 Q. V . , K a r t e l l a m t . . . , p. 26.
