Distribution Channels

Overview | Consumer Behavior | Pricing and Consumer Dynamics | Distribution Channels | Determinants of Brand Shares

“Assessing the Economic Value of Distribution Channels: An Application to the PC Industry”

Pradeep Chintagunta, Robert Law Professor of Marketing; Junhong Chu, Assistant Professor of Marketing at NUS Business School

Summary: Firms face increasing distribution channel options. In particular, direct-to-customer channels are now economically feasible in many industries. The authors set out to determine the profitability of various channel options available to PC manufacturers. Using structural models, it is possible to ask a counterfactual question of whether a firm would be better off using a channel that the firm elected not to use. The authors apply their approach to changes in PC channel decisions that were coincident with the HP-Compaq merger.