Distribution Marketing

Warmup Grab your work from the sub You should have 4 Handouts

Assignments DayActivity Friday CMS Survey, Ethics Packet, Ethical Dilemma(s), Weebly Post Monday Truman Show (6 Examples, 4 Questions, 1 Scene) Tuesday Truman Show & Distribution Notes Wednesday UPS Video (Only 4 th Period Submitted)

Turned /in…. Ethics Packet Stubenville Questions Weebly was individual What to Do? (Only Partner Activity) Green Sheet (4 of 6 scenarios) Truman Show White Sheet Distribution Notes / Terms Chapter 21 Handout UPS Video

To Do List: Formal Assessment Quiz on Friday: 25 Points Vocab quiz from Chapter terms Ethical Dilemma Solve 5 points for submitting 5 points for answering

Distribution Distribution deals with the place factor of the marketing mix. What are the other 3 P’s in the Marketing Mix? It is how the product you are selling ends up in the consumer hands. You get consumers interested in the product by how you market it You get them to buy a product by how it is distributed

Distribution The channel of distribution is the path a product takes from the manufacturer to the final user. Your final user can be a An industrial user (Company) A consumer Example product: Shampoo Who does shampoo get distributed to? Consumer Company

Distribution When a consumer purchases shampoo they use an intermediaries to do so. Intermediaries move products from the manufacturer to the final user. Intermediaries are basically middlemen

Intermediaries They are classified on the basis of whether or not they take ownership (title) of a good or service Agent Intermediaries do not take ownership of a product Get paid commission to get buyers and sellers together Examples: Sports Agents & Real Estate Agents Merchant Intermediaries take ownership of a product Wholesalers Retailers

Real Estate Agent v. CVS

Distribution Planning Cost v. Control Manufacturers frequently hire agents to move products versus hiring direct sales employees Manufacturer loses some control over the sales process Don’t have to pay agents unless they sell something Do not have to pay agents employee benefits

Distribution A wholesaler buys large quantities of a good from a manufacturer and then sells them to retailers Rack jobbers buy products and then manage the inventory they purchased Count stock, refill stock, maintain store displays, etc.. Only bill retailer for the amount they sell Drop Shippers own the goods they sell but do not physically handle the actual product Coal, Lumber, Chemicals They sell the goods for the manufacturer & the manufacturer ships it

Distribution Retailers sell goods to the final consumer for personal use. A brick and mortar retailer has a physical store that they sell products at

Distribution Retailers do not have to have a store to sell their product Vending machines Direct mail Catalogs TV Home Shopping Websites Larger brick and mortar retailers will offer options listed above

Distribution Channels of Distribution are either direct or indirect Direct distribution occurs when the producer sells goods or services directly to the consumer without the help of intermediaries Indirect distribution involves the use of intermediaries Retail Stores: Target, Wal-Mart, CVS, etc…

Nike Selling from Website v. In Stores

Distribution Intensity Distribution Intensity involves how widely a product will be distributed There are three levels of distribution 1. Exclusive 2. Selective 3. Intensive

Distribution Intensity Exclusive Distribution: Involves protected territories for distribution of a product in a given geographic area Dealers are assured that they are the only ones within a certain geographic region that will have the right to sell the manufacturers product. Prestige, image, channel control, & a high profit margin are characteristics of this distribution strategy. Franchises are examples of exclusive distribution

Distribution Intensity Selective Distribution: A limited number of outlets in a certain geographic region area are able to sell a product. Goal is to find channel members that can maintain the image of the product and are good credit risks. Examples: Ralph Lauren/Polo & Dillards, Macy’s

Distribution Intensity Intensive Distribution: Involves the use of all suitable outlets to sell a product The goal is to have complete market coverage & to sell as many products as possible. Example: Motor Oil is sold at auto shops, retailers, grocery stores, hardware stores, warehouses, oil places, etc..

Distribution E-Commerce is the means in which a product is sold to consumers through the internet. Online shopping is referred to as the e- marketplace Beneficial for smaller businesses and business- to-business sales

Distribution Method

Pick a Channel

Distribution Warm-up Name a product that is sold using exclusive distribution? iPhone used to only be available through At&t (2011 switched to ) If you want to buy the NFL package; what service must you have? Certain franchises give exclusive rights to their owners to protect against competition Common in cars & jewelry industry

Name a product that is sold using selective distribution? Name a product sold using intensive distribution?

Distribution Distribution Intensity involves… How widely a product will be distributed Physical Distribution is: Activities that help to ensure that the right amount of product is delivered to the right place at the right time.

Distribution Center The main focus of a distribution center is to MOVE products, not STORE products.