Marketing Channel Design and Integration - Assignment 2

This assignment explores the optimization of marketing channels for Kathmandu Holdings Limited in the Australian market. It discusses the background of the company, market variables, product variables, company variables, intermediary variables, environmental variables, and behavioral variables. The assignment also provides recommendations for achieving effective channel management.

MKT20023: MARKETING CHANNEL DESIGN AND
INTEGRATION - ASSIGNMENT 2:

Executive summary
The present assignment takes into consideration that marketing channels are necessary to be
analyzed. In the case of Kathmandu Holdings Limited, the travel and adventure merchandise is
tried to be extended towards Australian markets. The distribution channels are necessary to be
optimized with respect to the same. A customer-oriented objective needs to be implemented so
that operational effectiveness is achieved within the organization.

Table of contents
Introduction:....................................................................................................................................4
2. Background: a brief description of the selected company and its main broad categories of
products............................................................................................................................................4
3. Discussion of what your findings mean for the industry and a potential stretching of their
brand in Australia............................................................................................................................5
4. Recommendations as to how best to achieve this. Your recommendations should focus on the
application of key concepts, not a description of the theory...........................................................9
5. Conclusion.................................................................................................................................10
Reference list.................................................................................................................................11

Introduction:
The present assignment tries to investigate the effectiveness of business services through
accurate supply chain management and distribution channel optimization (Sifat and Mohamad,
2018). Kathmandu Holdings Limited is the present company under investigation. When this
company intends to address the Australian markets with their marketing distribution channel the
appropriate concepts and models are needed to be brought to light. It is necessary that different
areas of interest such as market, customer product, company, intermediary and environment shall
be taken into consideration.
2. Background: a brief description of the selected company and its main broad categories
of products
Kathmandu Holdings Limited is identified to be that retail store adopting transnational chain
where the products related to travel and adventure are sold (Pereira et al. 2016). The outdoor
apparels and equipment are made available. Kathmandu is acknowledged to be one of the
leading retailing chains where clothing and equipment for, sports, travel, and adventure are
traded across the UK and New Zealand. Having more than 163 stores successfully functional by
the end of July 2017 Kathmandu accounts to obtain 47 stores operating in New Zealand and 115
in Australia. Being initiated by John Pawson and Jan Cameron in 1987 they started the sales of
ALP Sports Clothing label. It was in Australia that the company planned to open its first ever
retailing outlet. However, the majority of their original clothing got manufactured in New
Zealand. It was in the year 1992 that Kathmandu established its strongest operative structure in
Australia. With their stores spread out in Melbourne, Sydney, Canberra, and Brisbane
Kathmandu re-entered the territories of New Zealand to pierce through their retailing
marketplace (Piwoz and Huffman, 2015).
The product categories range widely from travel to adventure accessories (Jensen, 2017). They
have a product portfolio which caters to the specification of women, men, kids, footwear. There
are specialized goods and merchandise products sold for camp and hike purposes. The travel
products are categorized in a gap year, luggage accessories, travel accessories and travel

essential or OE travel goods. There are special bags, clothing, transit that are prepared as a
category of accessories under travel cluster. There are packs and bags, SKI and Snow are
categorized particularly for travelers to accessories through appropriate products.
3. Discussion of what your findings mean for the industry and a potential stretching of
their brand in Australia.
Market variables:
One of the significant variables that tend to impact upon the channel structure is through market
variables which delineate the geography of the market, its size, density, and behavioral
outcomes. When Kathmandu Holdings Limited intends to extend its brand in the Australian
market the following aspects are necessary to be assessed regarding the sports and travel goods
industry (KC, 2016).
Market geography and Market density
When the hiking and outdoor equipment stores are tried to be based in Australia the market
research becomes an inevitable aspect of study report (Gavriletea, 2017). When the market
geography is analyzed it is understood how popular and dominate the market of travel and
adventure accessories is in Australia. There is a huge market prevalence of Kathmandu in
Australia. It is according to the latest reports processed by 31st July 2018 that Kathmandu
Holdings Limited is found to successfully carry out its operations across 167 permanent store
outlets in Australia. In addition to this, there are four of the most unique online stores established
in the Australian base which are: 118 in Australia, 48 in New Zealand and 1 in the United
Kingdom. The Kathmandu Australian website enlightens about how well scattered the store
outlets are to enable people from all parts of the country to avail their goods and merchandise
with feasibility (Singh and Maharjan, 2017). The travel and adventure equipment is made
available in all categories in each of their store outlets. There is a wide range of market demand
felt in these areas where the predominant name in travel and adventure gears and accessories is
the name of Kathmandu. It is highly appreciated by the Australian market about the online
channel of distribution that carries out market services in a successful manner. This channel of
distribution of products and services are highly acknowledged in Australia.

Market size
When the market size is taken into consideration the industrial statistics become extremely
essential to be undertaken. It is found that adhering to Kathmandu Holdings Limited operations
across Australia there revenue outcomes account to be $1 bn with a forecast of 18 to 23 percent
of the growth in their revenue by each year (Jacob and Florido, 2016). There is an annual growth
in the size of the market being 13 to 18 percent where the present size of the profit caused in the
Australia market is 1.2%. there are approximately 5,011 employees operating in different stores
distributed in across the Australian quarters. Taking account further the market size depicts 564
businesses as an opportunity for Kathmandu Holdings Limited in the Australian context.
Market behavior
When the hiking and outdoor equipment stores spread across Australia are taken into
consideration there are substantial challenges acknowledged within the markets. Kathmandu
Holdings Limited seems to face several limitations in their trading procedures through the
environmental factors when their operations across the five years are analyzed (Koczwara and
Dressman, 2017). There external competitions, as well as internal conflicts witnessed within the
travel equipment industries, are noticed to be quite high. There are growths in the discretionary
income levels where the consumers are spending a huge amount for their leisure times. Spending
time in the recreational activities and minimal planning included within reduced demands for
hiking and outdoor equipment are created. There are strong competences likely to be evidenced
by the enterprises which are operating outside the industry. The departmental stores and the
pure-play created through online retails are targeted towards hiking and camping equipment
(Phuyal, 2016). However, if the market idea has to be gagged the industrial revenue is expected
to be developing by an annualized 1.2% over the five years through the years 2017 and 2018.
Product variables
As Kathmandu Holdings Limited extends the travel and adventure goods and accessories, it is
found that product variety includes apparels and equipment according to specific requirements of
the customers. The apparels include the product diversity of waterproof jackets, thermals, down
jackets, fleece jackets, merino Apparel and thermals, shirts and pants, footwear and socks. In
terms of adventure and travel and camping equipment, they constitute bags, packs, tents, travel

accessories and camping equipment. There is an exclusive range of products that are ranging
from outdoor utilities to travel equipment and clothing (Sweet et al. 2016). The customer
suitability is widely looked after to design the products accordingly.
Company variables
Kathmandu Holdings Limited is a company that dominates their presence in the travel and
adventure goods and accessories industry. It is primarily across Australia, New Zealand that the
company has established its operations in an effectual manner (Hassan et al. 2018). The
company is found to have an in-house design to process draws on extensive experience for
industry trends and customer understanding by developing an insight. The technical designing
criticalities are designed through original products. The performance of Kathmandu Holdings
Limited is based upon the quality precursor where the new designs are central to initiatives. The
ongoing resource investment remains as a continuous process for designing, merchandising,
quality, technical development, and supplier management (Deo et al. 2019). There is persistent
focus directed through the product designing team to make the ability broad range in the
technical credibility apparel and equipment products that technical credibility in terms of
apparels and equipment shall need a broader customer base to be addressed.
Intermediary variables
As the workforce of the Kathmandu Holdings Limited company, there is a definite scatter
illustrating the supply chain objectives that are dealt with particular intermediary administrative
authorities. The general manager of supply chain procedures, Caleb Nicolson is given the idea of
establishing a smooth transition of goods and accessories according to demand generated. The
supplies from the warehouse to the respective store outlets across the Australian market belt is
tried to be established in a smooth manner (Dan Gavriletea, 2017). It is from the year 2007 that
Caleb Nicolson has joined the company where his responsibilities are extended towards delivery
change across the entire supply chain action. The merchandise functioning creates scope for
effective operative efforts to be fitted as intermediary to the company structure. Paul Stern is
identified as another strong spokesperson that is in charge of the marketing and the online
channel of distribution of goods and equipment. He is authorized as the General Manager for the
online and marketing loop of activities where the retail services across Australian online portals

are carried out for over 18 years of span. Being the senior to the retail and marketing roles the
service efficacy is guaranteed. Mark Handy is the general manager in the merchandising
department. Mark has joined Kathmandu Holdings Limited and offered services for 25 years.
There is an immense contribution of merchandising planning, hence proves to be a proficient
intermediary (Tiwari and Korneliussen, 2018).
Environmental variables
Kathmandu Holdings Limited is operational as a global brand in the travel and adventure
accessories and equipment the environmental variables impact in the form of orienting their
services to encompass corporate social responsibilities. The workers' rights are protected as the
supply chain is understood within the Australian market (Squires et al. 2015). When the
Australian market is tried to be targeted by Kathmandu Holdings Limited minimization of waste
ad lowering the environmental effects through business processes are tried to be ensured. There
are initiatives created through their Australian website as a provision to design the websites so
that customers can be educated, team members and investments on the sustainability approach.
Behavioral variables
Kathmandu Holdings Limited when tries to address and target the Australian market is tried to
show utmost dedication in the restoration of sustainable practices. More and more positive
impacts are tried to be ensured with moving beyond mere selling of travel and adventure
merchandise and equipment. The behavioral aspect is given much significance when Australian
markets are tried to be approached. Hence the worker wellbeing is tried to be ensured to the
optimized levels. Kathmandu Holdings Limited assures the establishment of committed
dedication in protecting human rights and being proactive in improving the conditions for
implementing supply chain (Patrick, 2017). The materials are tried to be used in a more
responsible manner. It is necessary that 85% of the product impacts are created through the
materials that they incorporate. The materials are likely to impact on the climatic transition
where water use, resource depletion, and pollution shall be created. The environmental impacts
through building green and ensuring the recycling programs along with offsetting the carbon
emission shall be created. There are policy and reports established in the company which
emphasizes sustainability issues and the sourcing materials view the current policies.

4. Recommendations as to how best to achieve this. Your recommendations should focus on
the application of key concepts, not a description of the theory.
 Channel Management
Channel Management is that marketing concept where the supply of goods from the company to
the consumers shall be representing marketing. The supply of goods and materials from the
company to consumers shall be taking a channel strategy taking the products, budget constraints,
and supply chain and partner relationship.
It is recommended that the channel management process is possible to be optimized if the
following five steps are possible to be undertaken:
 Analyzing consumers:
When Kathmandu Holdings Limited plans to address the Australian markets the customers of
that region have to be understood and evaluated (Abdelbaky, 2016). The customer needs have to
be taken into serious consideration so that product designing shall be done. Purchasing from a
reputable dealer, comparing prices and merchandise characteristics, dealer equipment to prompt
and reasonable product services are analysis methods.
 Establishing channel objectives:
Customer needs a specific marketing approach to capture channel objectives to enable
appropriate marketing strategies shall be undertaken. Creating niche marketing to carve the
channel objectives by addressing Australian customer needs so that Kathmandu Holdings
Limited is able to optimize its services shall be established.
 The distribution tasks specified:
 Kathmandu Holdings Limited needs to ensure that ordered products are delivered within
48 hours of placement (Ojha et al. 2016)
 Offering adequate storage space for products
 Extending added credits towards intermediaries of Kathmandu Holdings Limited
 The product return network in case of Australian online retail service shall be facilitated
 Evaluate and select channel alternatives:

The number of levels of the channel has to be established by Kathmandu Holdings Limited
Intensity at each level shall enable channel managers to determine the needs of customers
Types of intermediaries are appropriately selected through Australian markets by Kathmandu
Holdings Limited
 Evaluating channel member performance:
The needs of the Australian customers addressing the retail markets through online and in-store
outlets shall be established. The marketing mix is quite interdependent where controls and
reluctance shall be practiced so that performance criteria shall be evaluated.
5. Conclusion
When the marketing channels are tried to be optimized addressing the Australian market
Kathmandu Holdings Limited needs to take into consideration that customer specific approach is
taken. The products such as travel and adventure accessories and equipment shall be different
according to product designing and supply chain effectiveness (Worboys Ojha et al. 2018). The
performances are tried to be popularized by enhancing the selling capacity by understanding the
customer attitudes of Australian customers. The distribution channel management is tried to be
diversified and optimized by adhering to in-store as well as online retail mediums to address
Australian demands of travel and adventure goods.

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