Developing Distribution
and Promotional
Strategies
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 1
Distributing Products
• Distribution strategies
• Marketing intermediaries
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 2
Wholesalers and Retailers
• Match buyers and sellers
• Provide market information
• Provide promotional and sales
support
• Gather an assortment of goods
• Transport and store products
• Assume risks and provide financing
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 3
How Intermediaries
Simplify Commerce
• Reduce prices
• Reduce contacts
• Create utility
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 4
Alternative Distribution Channels
Consumer Goods and Services
Producer
Producer
Producer
Producer
Agent/Broker
Producer
© Prentice Hall, 2005
Consumer
Retailer
Consumer
Wholesaler
Retailer
Consumer
Wholesaler
Retailer
Consumer
Business Goods and Services
Business In Action 3e
Consumer
Chapter 12 - 5
Channel Selection
•
•
•
•
Market coverage
Cost
Control
Channel conflict
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 6
Market Coverage
• Distribution
– Intensive
– Selective
– Exclusive
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 7
Cost Factors
• Selling
• Storage
• Distribution
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 8
Control Issues
• Channel length
– Shorter
– Longer
• Overall control
– More
– Less
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 9
Channel Conflict
• Inadequate product support
• Too many intermediaries
• Multiple sales channels
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 10
Managing Physical Distribution
•
•
•
•
•
Order processing
Inventory control
Warehousing
Materials handling
Transportation
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 11
Online Distribution
• The Internet
– Distribution system
– Market reach
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 12
Promotional Strategies
• Promotional goals
• Product variables
• Promotional mix
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 13
Setting Promotional Goals
• Informing
• Persuading
• Reminding
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 14
Analyzing Product Variables
• The nature of the product
• Price of the product
• Position in the life cycle
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 15
Choosing a Marketing
Approach
• Push strategy
• Pull strategy
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 16
Elements of Promotion
•
•
•
•
•
Personal selling
Advertising
Direct marketing
Sales promotion
Public relations
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 17
Personal Selling Process
1. Prospecting
2. Preparing
3. Approaching
4. Presenting
5. Handling objections
6. Closing
7. Following up
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 18
Advertising and Direct
Marketing
• Product awareness
• Product image
• Consumer demand
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 19
Direct Marketing Vehicles
•
•
•
•
Direct mail
Target e-mail
Telemarketing
Internet
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 20
Advertising Categories
•
•
•
•
•
Product
Institutional
National
Local
Cooperative
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 21
Major Advertising Media
•
•
•
•
•
•
Newspapers
Television
Direct mail
Radio
Magazines
Internet
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 22
Sales Promotion
• Consumer promotion
• Trade promotion
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 23
Consumer Sales Promotion
•
•
•
•
Coupons
Rebates
Point-of-purchase
Special events
© Prentice Hall, 2005
•
•
•
•
Cross-promotion
Samples
Premiums
Specialty ads
Business In Action 3e
Chapter 12 - 24
Trade Sales Promotion
•
•
•
•
Trade allowances
Display premiums
Contests or sweepstakes
Travel bonus programs
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 25
Public Relations
• News release
• News conference
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 26
Integrated Marketing
Communications
• Promotional mix and IMC
– Public relations
– Personal selling
– Advertising
– Direct marketing
– Sales promotion
© Prentice Hall, 2005
Business In Action 3e
Chapter 12 - 27