The use of the phrase “Market Development Funds” or the acronym MDF has been widely used within Marketing circles, but what is the “theory” behind them?  There is little on explaining what the true advantage is to investing into such programmes and what both the manufacture and distributor both stand to gain.

Leverage the Power of the Brand with the knowledge of the Market

The primary purpose for any marketing activity is to raise awareness, get customers interested and ultimately purchase more product.  By utilising the regional knowledge that a distributor has, combined with the familiarity of a well known brand, and you now have a very powerful presence in the market place.  This is where MDFs provide the capability of creating effective marketing activity, funded by the manufacturer, presented by the distributor, targeted for the right audience.

MDFs explained, with a working example from Intel

The following article provides an excellent reference covering MDFs, using terminology that is clear and easily understood.  Not only does Smith explain the basics behind MDFs and provide well laid out examples, but also covers the Strategy and Economics that lay behind them.  Smith examines a real world example, with the use of MDFs by Intel, and their effectiveness in moving into the second phase of industry competition in the core-processor market for personal computers.

Intel, Market Development Funds and Distributors  

MDFs the bottom line

How do you know if the investment in MDFs is making a return and increasing profits?  There are several challenges to any organisation that wishes to implement a MDF programme and achieve the anticipated results.  This is where ChannelFlow from Q:chi can provide the framework by which a MDF programme can be effectively implemented.  Using a proprietary software algorithm unique to Q:chi, ChannelFlow can be tailored to meet the exact requirements for any organisation that requires an effective MDF programme.  McAfee uses ChannelFlow supporting over 2750 users and currently just over 250,000 transactions centred on Marketing Activity. With a turnover of $1.15 Billion in 2005, McAfee displays how ChannelFlow has been a big part of their success story.

What to know more about ChannelFlow?

The link below illustrates some of the Key Challenges that ChannelFlow addresses, and of course you are always welcome to contact us, to answer any further questions you may have.

 Q:chi and Channel Marketing

Author Joel Greenwell