The emergence of electronic commerce (e-commerce) has created a new business paradigm, one that presents marketers with noteworthy opportunities and challenges. Perhaps the greatest impact is in the area of channel management. The top issue for many business-to-business (B2B) firms today is channel conflict. In this paper, we investigate the effect of introducing the Internet channel into an already complex, multichannel distribution system from the perspective of the supplier firm. We describe strategies for proactively managing conflict, both externally with channel partners and internally among the subunits responsible for managing the channels. Twelve propositions for research are developed; eight relate directly to the marketing mix and four focus on channel communication and coordination. All of the research propositions offered are mechanisms by which suppliers can influence the level of channel conflict they experience. Dedicated channel management groups, documentation of channel strategies, and superordinate goals are identified as strategies for minimizing unwanted conflict.

Today's dynamic markets are forcing firms to design increasingly complex channel strategies involving multiple channels of distribution. As the complexity of these systems increases, so too does the opportunity for conflict between individual channel coalitions within the firm. Whereas this hybrid channel conflict can reduce channel performance, it can also serve as a mechanism forcing internal channel coalitions to work harder and smarter to serve their markets. In this paper, we develop and test six hypotheses related to hybrid channel conflict. The findings indicate that hybrid channel conflict is an important determinant of both channel performance and satisfaction. The results suggest further that the relationship between hybrid channel conflict and channel performance is moderated by the lifecycle stage. Moreover, our data support the view that the frequency of conflict, but not its intensity, has a negative effect on channel system performance. We conclude with a discussion of the theoretical and managerial implications of this study.

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The use of several distinct channel types by suppliers to serve a given product-market is rapidly becoming the dominant design. Such increasingly complex distribution systems present unique opportunities and problems for marketers, including how to most effectively manage the intrafirm, interchannel conflict resulting from channel coalitions competing with one another for resources, both internal (expenditures, personnel) and external (customers). Moreover, it is unclear whether conflict in a hybrid distribution system is ''good'' or ''bad'' for the supplier firm. We develop a theoretically-grounded conceptual model of the antecedents and consequences of hybrid channel conflict and offer several empirically testable research propositions, including a contingency framework for determining the functionality of hybrid channel conflict.

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