Distribution
Where to sell?
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Price
Target Market
Positioning
Inventory
Channel relationship
Two types of Channels
• Direct to Consumer
• Indirect Channels
– Agents/brokers
– Wholesalers
– Retailers
• Also, single channel vs Multichannel
Value of Channel
• Transactional
– Contact and promotion
– Negotiation
– Risk
• Logistical
– Physical distribution
– Storing
– Sorting
Problems in the channel
• Power  control/influence behavior of other
channel members
• Control  one channel member intentionally
affects another’s behavior
• Leadership  member who exercises
authority and power over activities of other
• Conflict  clash between members
– Horizontal
– Vertical
Factors affecting channel choice
• Market
– Customer behavior
– Geography
– Size
• Product
– Complexity
– PLC
– Is product fragile
Three Distribution Strategies
• Intensive
• Selective
• Exclusive
Types of Retailers
• Food
• General Merchandise
• Service
– AutoRental
– Spas
– Bank
Food
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SuperMarket
SuperCenter
Convenience
Warehouse Club
General Merchandise
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Full-Line Discount
Category Specialist
Drug
Specialty
Department
Off Price
Extreme Value
Benefits of Stores
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Browse
Touch/Feel
Personal Service
Cash and Credit
Entertainment/Social
Immediate Gratification
Risk Reduction
Benefits of Online Presence
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Deeper and broader selection
Personalization
Insights into Customer Shopping
Increase satisfaction and loyalty
Expand Market presence