What are the sources of Channel Gaps?
1. Environmental bounds (or constraints) legal constraints physical infrastructure (local) --> In general, they occur outside the focal company --> They directly impact channel activities --> result in inappropriate service outputs --> result in excessive cost 2. Managerial bounds (or constraints)
Name the 2 types of Gaps
Demand Side Gaps Supply Side Gaps
Name the consequences of Demand side gaps
SOS > SOD --> cost SOS < SOD --> lost opportunities (revenues)
What are Supply side gaps?
Supply side gap is equivalent to : Total cost of performing all channel flows is too high. But : Do not judge supply side gaps on individual flows!
What are the results of : Demand-side gap (SOD > SOS) and No supply-side Gap ?
Price/value proposition = right for a less demanding segment
What are the results of :
No Demand-side gap (SOD = SOS) and No supply-side Gap ?
No Gaps
What are the results of :
Demand-side gap (SOS > SOD) and No supply-side Gap ?
Price/value proposition = right for a more demanding segment!
What are the results of :
Demand-side gap (SOD > SOS) and supply-side Gap ?
Insufficient Service output provision, at high costs : price and /or cost too high, value too low.
What are the results of :
No Demand-side gap (SOD = SOS) and supply-side Gap ?
High cost, but Service outputs are right: benefit is right, but price and /or cost is high
What are the results of :
Demand-side gap (SOS > SOD) and supply-side Gap ?
High costs and Service outputs = too high: no extra value created, but price and/or cost is high
Name 2 propositions on closing Demand Side Gaps
Adjust SOS ( increase/lower ) Adjust segments targeted (e.g. choose adjacent segment, split segments)
Name 3 propositions on closing Supply Side Gaps
Keep channel members, adjust their responsibilities (only) Keep channel members, drive efficiencies through introduction of new technologies/processes Change channel structure, dis-/re-intermediate
