Channel strategy: Formulation and adaptation

Inspired by open systems theories like the structural contingency theory (Lawrence and Lorsch 1967), population ecology theory (Hannan and Freeman 1977), and resource dependence theory (Pfeffer and Salancik 1978), several marketing scholars have investigated how channels adapt and organize themselves to cope with their environments. Curiously, however, the implication of such adaptive behaviour (i.e., the better adapted firms are more profitable) has not been investigated in the marketing literature. This paper aims to probe that question. Moreover, unlike previous marketing studies, we articulate the manufacturer's rather than the distributor's point-of-view, because channel strategy decisions are usually in the manufacturer's domain. We scrutinize firms' adaptive responses from a channel structure and channel task perspective. Results show that the better adapted firms deliver superior performance, and that the adaptive responses often occur subtly at the specific channel task level even when the channel structure itself may appear seemingly unaltered.