Distribution Channel of Distribution The path a product takes from its producer to the final end user. Intermediaries Business involved in sales transactions that move products from producer to end user. Reduce the number of contact required to reach final user
Wholesalers Business that buy large quantities of goods from manufactures, store the goods, and then resale them to other businesses.
Agents/Brokers Do not own the goods they sell. They bring buyers and sellers together.
Retailers Sell goods to the final consumer for personal use. Brick-and-mortar retailers – physical store E-tailing – online site Direct Sales Telemarketing Catalogs Vending Machines
Retail Distribution Strategies Intensive Distribution: Puts products into as many retail outlets as possible. Selective Distribution: Sells products to only a preferred group of retailers in an area Exclusive Distribution: Sells products to only one outlet in a given area
Direct and Indirect Channels Direct distribution occurs when the goods or services are sold from the producer directly to the customer – no intermediaries are involved. – Example: A farmer sells corn at a street market. Indirect distribution involves one or more intermediaries.
1.Target market 2.Customer Service 3.Product image 4.Costs 5.Transport options 6.Payment arrangements Factors to consider when deciding which Channel of Distribution to use 11
Push vs. Pull Marketing Push Marketing: The distribution channel promotes and sells your product to consumers. Common where brand loyalty is low—the consumer makes the choice to purchase the product in the store.
Push vs. Pull Marketing Pull Marketing: The product is promoted directly to consumers, who then go to the distribution channel to purchase product. Common for products where brand loyalty is high—the consumer chooses to purchase the product before going to the store.