We now look at the third marketing mix tool—distribution. Companies rarely work alone in engaging customers, creating customer value, and building profitable customer relationships. Instead, most are only a single link in a larger supply chain and marketing channel. As such, a firm’s success depends not only on how well it performs but also on how well its entire marketing channel competes with competitors’ channels. The first part of this chapterexplores the nature of marketing channels and the marketer’s channel design and management decisions. We then examine physical distribution—or logistics—an area that has grown dramatically in importance and sophistication. In the next chapter, we’ll look more closely at two major channel intermediaries: retailers and wholesalers.

We start by looking at Uber, the fast-growing, app-based car-hailing service that has recently sprouted up in cities around the world. Uber has radically reinvented urban transportation channels, posing a serious threat to conventional taxicab and car service companies. As Uber grows, traditional competitors must innovate or risk being pushed aside.