Role of Marketing in Supply Chain Management
Supply chain management traditionally has focused on sourcing components, materials and other supplies as well as distribution. Marketing plays an increasingly important role in the process; it balances procurement by providing essential demand information and building the relationships that help improve the efficiency of supply chain operations.
A definition from the Council of Supply Chain Management Professionals highlights the integration of supply-and-demand management within and across companies. It stresses the importance of coordination and collaboration with channel partners such as suppliers, intermediaries and service providers. This increasingly blurs the lines between companies and suppliers. Marketing plays an important role in building the relationships between the parties through communication and support programs. That, in turn, helps to build a collegiate environment in which all parties interact and participate in business development programs that contribute to improved customer service.
In a collaborative relationship, supply chain partners contribute to high levels of customer satisfaction and help to make a company the preferred choice for customers. Marketing provides information on products and availability, prices, order tracking, incentives, marketing campaigns and sales information. This increases understanding of market demand and marketing initiatives, which in turn improves supply chain planning. By focusing partners’ attention on customer requirements, marketing enables the supply chain to strengthen the company's competitive position and support the successful development of new products.
When supply chain partners have the right level of market awareness, they can deliver added value and play a proactive role in providing products and services. Marketing can design programs to help partners grow their own business and make it easier for members of the supply chain to work together. Business education programs help partners keep up with the latest developments and maintain their product and business skills. Courses cover issues such as management development, product marketing skills, industry knowledge and sales and marketing tools.
Marketing can help distribution partners benefit directly from the strength of a company brand. The brand differentiates a company from the competition when it communicates with potential customers. Marketing also can support resellers by driving business in their direction. This can be as simple as generating leads or running joint marketing campaigns. Reward programs encourage distribution partners to do more business with a company, while incentive programs can increase revenue for both parties.
Marketing provides an essential balance in supply chain management. It helps companies and their partners become more focused on customers rather than on the production process. By improving communications, support and collaboration, marketing helps increase supply chain efficiency and create a single extended enterprise with a strong competitive edge.