Toy Channels

Case Study # 100884

Business > Companies
Business > Consumer Behavior
Business > Management
Business > Marketing
Computer and Technology > Internet

Toy Channels

This paper discusses whether LeapFrog and other toy manufacturers should refuse to sell some of their best selling products to Wal-Mart.

1,019 words () | 4 sources | APA | 2007 United States

Paper Summary:

In this article, the writer considers the advantages and disadvantages for toy manufacturers to sell products to Wal-Mart. The writer first looks at marketing channels, channels of distribution and physical distribution. The writer explains that channels of distribution consist of one of four types of distribution systems that take a finished product to the consumer. The writer maintains that in one instance, if toy companies sell to Wal-Mart and use a retailer channel, they are allowing more people to see their product due to the great number of consumers Wal-Mart attracts. On the other hand, the writer points out that if a product sells well, the direct channel may work better because companies do not require a retailer due to the demand for their good, which means the company can go direct to the consumer. The writer concludes that the retail channel allows the manufacturers to utilize the Internet to set up a direct channel once product recognition is established, thereby increasing the number of items sold and thus the profits the company makes.

From the Paper:

"With the advent of the Information Age, the Internet and Internet business are becoming the norm and there are an unlimited number of online vendors. The direct distribution channel allows consumers to purchase direct and the Internet provides the medium for a variety of these channels. Toy manufacturers can take advantage of this and set up websites and through a physical distribution channel such as FedEx, they can guarantee that their products are sold. In order to sell product this way, there needs to be some brand recognition. This is where retail channels help and increase recognition of a product through showcasing. The traffic that sees product at Wal-Mart is much higher than that of a company's individual website and therefore the product gets more brand recognition. This creates more recognition of the manufacturer and is therefore retail channels are needed."

Sample of Sources Used:

Brown, Eryn (2004, Sep. 12) "Imagining Toyland Without One of Its Giants" New York Times, pg. 3, 5.
Chambers, Erin (2004, Nov 24). How a Toy Store Plays to Win: Debi Grymes' small shop thrives despite a nearby Wal-Mart, thanks to unique items, tea parties for little girls, and attentive service. Business Week.
Gogoi, Pallavi (2006, Nov 3). Tis the Season for Price Cuts. Wal-Mart and its rivals are going to get aggressive about discounting as they head into the crucial holiday season. Business Week Online. p14.
Tsao, Amy (2002, Nov 27) Will Wal-Mart Take Over the World? the insatiable chain's next target? You name it. Business Week Online. p14.