Introduction
A horizontal marketing system is a type of marketing arrangement where two or more companies at the same level of the distribution channel come together to form a cooperative partnership. This collaboration allows them to combine their resources, expertise, and market presence to achieve common goals. In a horizontal marketing system, companies work together to create a more efficient and effective marketing strategy. One example of a horizontal marketing system is the formation of strategic alliances between companies operating in the same industry.
Strategic Alliances as Horizontal Marketing Systems
A strategic alliance is a cooperative agreement between two or more companies that involves sharing resources, knowledge, and capabilities to achieve mutual benefits. In the context of a horizontal marketing system, strategic alliances are formed between companies that operate in the same industry or offer complementary products or services.
Benefits of Strategic Alliances: Strategic alliances offer several benefits to the participating companies. By pooling their resources and expertise, companies can achieve economies of scale, reduce costs, and increase their market reach. They can also leverage each other’s brand reputation and customer base to gain a competitive advantage. Additionally, strategic alliances enable companies to share risks and access new markets or distribution channels that would be difficult to penetrate individually.
Examples of Strategic Alliances as Horizontal Marketing Systems: One example of a horizontal marketing system through strategic alliances is the partnership between airlines. Airlines often form alliances to offer customers a wider range of destinations and seamless travel experiences. For instance, the Star Alliance, which includes airlines such as United Airlines, Lufthansa, and Air Canada, allows passengers to book flights with any member airline and enjoy benefits such as shared frequent flyer programs and access to airport lounges.
Another example is the automotive industry, where car manufacturers form strategic alliances to develop new technologies or share platforms for vehicle production. For instance, the Renault-Nissan-Mitsubishi Alliance is a strategic alliance between three major car manufacturers that enables them to share technologies, components, and manufacturing facilities, resulting in cost savings and increased competitiveness in the global market.
Conclusion
In conclusion, a horizontal marketing system involves the collaboration between companies at the same level of the distribution channel. Strategic alliances are one example of a horizontal marketing system, where companies form cooperative partnerships to achieve mutual benefits. These alliances allow companies to leverage each other’s resources, expertise, and market presence to enhance their competitive position in the industry. Examples of strategic alliances can be found in various sectors, such as airlines and the automotive industry.
References
– BusinessDictionary.com: www.businessdictionary.com/definition/horizontal-marketing-system.html
– Investopedia: www.investopedia.com/terms/s/strategicalliance.asp
– Star Alliance: www.staralliance.com
– Renault-Nissan-Mitsubishi Alliance: www.alliance-2022.com
