Corporate market system and administrated vertical marketing system differences?

The corporate market system and administrated vertical marketing system are two different approaches to organizing and managing marketing activities within a company.

1. Corporate market system: In a corporate market system, the company has full control over its marketing activities and functions. This means that the company is responsible for all aspects of marketing, including product development, pricing, promotion, and distribution. The company may have a dedicated marketing department or team that is responsible for developing and implementing marketing strategies. The company may also work with external partners, such as advertising agencies or PR firms, to help execute its marketing activities. Overall, the company has a high degree of autonomy and flexibility in how it approaches marketing.

2. Administrated vertical marketing system: In an administrated vertical marketing system, the company works closely with other members of the distribution channel to coordinate marketing activities. This system is often used in industries where there are multiple levels of distribution, such as in the retail or automotive industries. In an administrated vertical marketing system, the company may work with distributors, wholesalers, retailers, and other partners to develop and implement marketing strategies. The company may also set guidelines and standards for how its products are marketed and sold by its partners. This system requires a high level of coordination and communication between all parties involved in the distribution channel.

Overall, the main difference between a corporate market system and an administrated vertical marketing system is the level of control and coordination that the company has over its marketing activities. In a corporate market system, the company has full control over its marketing activities, while in an administrated vertical marketing system, the company works closely with other members of the distribution channel to coordinate marketing activities.

Corporate Marketing System

- Single company owns and controls the entire distribution channel.
- All levels of distribution are part of the same corporate entity.
- Centralized planning and decision-making.
- High degree of coordination and control.
- Examples: Apple, Amazon, Dell.

Administrated Vertical Marketing System

- A group of independent companies work together to coordinate their marketing efforts.
- One channel member (e.g., manufacturer, wholesaler, retailer) has the dominant influence in the system.
- Channel members retain some independence but agree to certain rules and policies.
- Examples: Franchise systems (e.g., McDonald's, Subway), cooperative buying groups.

Key Differences:

| Feature | Corporate Marketing System | Administrated Vertical Marketing System |
|---|---|---|
| Ownership | Single company | Independent companies |
| Control | Centralized | Dominant channel member |
| Coordination | High | Moderate |
| Integration | Complete | Partial |
| Flexibility | Limited | Somewhat flexible |
| Legal implications | Vertical integration (legal issues) | Contractual agreements |
| Scale economies | Potential for high scale economies | Some scale economies possible |
| Channel conflict | Minimal | Potential for conflict between members |
| Innovation | Potential for internal innovation | Limited innovation opportunities |
| Customer focus | Direct connection with customers | Less direct customer contact |
| Channel efficiency | High | Moderate to good |
| Cost structure | Fixed and variable costs | Variable costs primarily |
| Profit potential | High profit potential | Moderate profit potential |