business w11a distributing products @1

Distributing Products

Week 11

Exclusively designed and presented by: Anna Riana Putriya

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The Four P’s and The Four C’s

Marketing

Mix

Product

Price Promotion

Place

Customer

Solution

Customer

CostCommunication

Distribution

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What is the Distribution Mix ?

The combination of distribution channels by

which a seller gets its product to end users

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Channels of Distribution

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Channels 1-4

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http://www.avon.com

Tupperware

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Levi’s

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Gas Station

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= Customer= Customer

= Manufacturer= Manufacturer

A.A. Number of Number of contacts contacts without a without a distributordistributorM x C = 3 X 3 = M x C = 3 X 3 = 99

11

3322

4455

66

77

88

99

How a distributor reduces the number of channel transactions

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= Distributor

= Customer

= Manufacturer

B. Number of contacts with a distributorM x C = 3 + 3 = 6

Store

11

22

33

44

55

66

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Channels 5

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Channels 6-8

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Distribution Strategies1. Intensive distribution is a strategy by which a

product is distributed through as many channels as possible

2. Exclusive distribution is a strategy by which a manufacturer grants exclusive rights to distribute or sell a product to a limited number of wholesalers or retailers

3. Selective distribution is a strategy by which a company uses only wholesalers and retailers who will give special attention to specific products

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Agents and Brokers

Agents and brokers serve as independent sales representatives for many companies’ products

� They work on commission

� They do not own their merchandise

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Types of E-Intermediaries

1. Syndicated sellers are Web sites that offer another

a commission for referring customers

2. Shopping agents (or E-agents) help Internet consumers

by gathering and sorting information

3. Business-to-business brokers enable businesses to

buy and sell from one another and confirm transactions electronically

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Syndicated sellers

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Shopping agents (or E-agents)

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Shopping agents : http://www.terkenal.com/Belanja_Online/Buku_dan_CD/

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Business-to-business brokers: www.iklanbaris.com

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Merchant Wholesalers

Merchant wholesalers buy products from manufacturers and sell them to other businesses

� Full-service merchant wholesalers provide credit, marketing and merchandising services

� Limited-function merchant wholesalers provide fewer services

� Drop shippers don’t carry inventory or handle products

� Rack jobbers market consumer goods directly to retail stores

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Types of Retail Outlets

1. Product line retailers feature broad product lines

2. Bargain retailers carry wide ranges of products and come in many forms

3. Nonstore and electronic retailing involves selling all or most of a retailer’s products without brick-and-mortar stores

Retailers

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Product Line Retailers

a) Department stores are organized into specialized departments

b) Supermarkets are divided into departments of related products

c) Specialty stores are small stores that carry one line of related products

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Bargain Retailers

• Discount houses generate large sales volume by offering goods at substantial price reductions

• Catalog showrooms mail catalogs to attract customers into showrooms to view display samples and place orders to be picked up at on-premises warehouses

• Factory outlets are owned by the manufacturer whose products it sells

• Warehouse club (or Wholesale club) offers large discounts on brand-name merchandise to customers who pay annual membership fees

• Convenience stores offer easy accessibility, extended hours and fast service

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Nonstore and Electronic Retailing

Direct-response retailing involves direct interaction with

customers to inform them about products and to receive sales

orders

• Mail order (or Catalog marketing)

• Telemarketing

• Direct selling

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Mail order : Eddie Bauer

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What is Electronic Retailing ?

Nonstore retailing in which information about the seller’s

products and services is connected to consumers’ computers,

allowing consumers to receive the information and purchase the products in the home

• Internet-Based Stores

• Electronic Catalogs (or E-catalogs)

• Electronic Storefronts and Cybermalls

• From Door-to-Door to E-Sales?

�Multilevel Marketing

• Interactive and Video Marketing

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What is Physical Distribution ?

Activities needed to move a product efficiently from manufacturer to consumer

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Transportation tools� Planes

� Trucks

� Railroads

� Water carriers

� Pipelines

Factors in choosing transportation methods:� Cost

� Nature of the product

� Distance

� Speed

� Customer wants and needs

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thank you